What do business ecosystems mean for your company and how do they impact your role as a leader?

Matthias Pfisterer

By Matthias Pfisterer

Doctoral Researcher, People Management & Leadership

Katleen De Stobbeleir

By Katleen De Stobbeleir

Professor of Leadership

Carine Peeters

By Carine Peeters

Professor of Strategy

11 May 2020

Recently, two competing Belgian telecom giants, Telenet and DPG Media, announced an intensive strategic collaboration in response to the increased competition from global players like Netflix, Disney + and Apple TV. Such strategic partnerships between organisations are not new. Think of the collaboration between Douwe Egberts and Philips, which led to the introduction of the Senseo coffee machine. Most of these strategic collaborations consist of clearly defined and formalised projects, in which the legal departments are closely involved in delineating the partnership as well.

But the world is changing rapidly. And so is the way in which organisations partner with each other. Changing customer expectations, increased regulation, new technologies, and the societal risks that come with a globalising economy shape the strategic agendas of many CEOs. These evolutions force organisations to rethink the way in which they collaborate with partners.

Whereas in the past, organisations focused on a selective number of strategic partners, who were carefully selected based on strategic fit and complementarity, companies increasingly bring a much bigger group of partners and stakeholders together in more organic and evolving networks of partnerships, or so-called ‘ecosystems’. These are continuously evolving networks of many stakeholders (providers, societal partners, suppliers, distributors, customers, governments, competitors, etc.) that join forces to develop and/or offer products or services via collaboration as well as via competition.

Business ecosystems often emerge to deal with complex challenges that cannot be addressed by a single organisation alone. Challenges can range from optimising the client experience, to more societal challenges like healthcare, waste management in communities, or finding staff in the war for talent. Increasingly, ecosystem thinking is also used in the pursuit of commercial goals. One of the most well-known commercial applications of ecosystems might be Alibaba, an e-commerce platform that brings together suppliers and customers of goods, and which has commercialised this service. Other examples include TripAdvisor, Booking.com, Airbnb, Amazon, and Bol.com.

Seeing ecosystems as merely a hype and ignoring their potential could be costly for your business. Think of the retail chain Blokker, a company that in its high days had 2,825 physical stores. In 2012, the company had the unique opportunity to buy the now very successful e-commerce platform Bol.com. Not believing in e-commerce and the power of ecosystems, Blokker did not pursue this opportunity, and missed out not only on the opportunity to develop its own e-commerce activities, but also on developing the potential of becoming a platform organisation. These decisions brought Blokker into severe financial difficulties and resulted in several reorganisations. Such examples highlight that ecosystem thinking is not a nice-to-have, but an essential part of doing business.

However, it’s just as important not to impulsively start to collaborate in an ecosystem without putting a great deal of thought into the purpose of it. This kind of collaboration may put your organisation at risk as well. It is important to not only consider the opportunities that ecosystems entail, but also the challenges that come with them. How can your organisation benefit from ecosystem thinking? What are triggers that could prompt your organisation to work with your ecosystem? And how to structure such collaboration?

Answers to these questions can be found in the white paper ‘Business Ecosystems: what do they mean for your company? And how do they impact your role as a leader?’. The white paper is based on interviews with the 10 partners of our Centre for Excellence in Leading Adaptive Organisations – which aims to help organisations become more effective in dealing with a dynamic and fast-changing environment – as well as interviews with experts in the field.

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Katleen De Stobbeleir

Katleen De Stobbeleir

Professor of Leadership