In a paper entitled ‘Designing Interactive Strategy’ (1993)¸ the founding partners of NormannPartners introduced the concept of a ‘value-creating system’, whereby ‘different economic actors – suppliers, business partners, allies, customers – work together to co-produce value’, busting the linearity of value chains. They added that, to capture a disproportionate share of the value created by that system, a firm must ‘write the script [and] invite, interest, enrol, mobilize others into a designed value-creating system.’
More recently, in ‘Ecosystem as a Structure: An actionable Construct For Strategy’ (2017), Ron Adner at Dartmouth College defined what he considers to be the most advanced form of ecosystems, beyond the simple ‘community of associated actors defined by their […] platform affiliation.’ According to him, the most powerful systems start with a clear definition of the ultimate value proposition to customers (building, for example, on the holistic approach promoted by Design Thinking). What is then required is a detailed mapping of the actors needed to deliver such offering and, next, a clear plan to entice and align them.
In line with the approach put forward by Normann/Ramírez, Mr. Adner refers to the opportunity by a corporate to implement an ecosystem strategy with a view to establishing itself as the ‘focal firm’. But it should not be a fixation. Depending upon the objectives of the ecosystem, sharing a role or being an active contributor can represent an attractive alternative, both strategically and financially.
With the broad concept of stakeholders and sustainability taking shape, these advanced ecosystems must evolve further, following the compelling logic of ESG integration. In ‘The Ecosystem of Shared Value’ (2016), the authors made a first step in that direction and explain how firms can expand their business ecosystem to include stakeholders as part of a ‘collective impact’ strategy designed to fix socio-economic issues. From there on, the ecosystem concept will need to include environmental sustainability considerations.
What does stand in the way of success? Following a discussion with NormannPartners, leadership teams tend to be overly focused on the other actors, and not enough on the existing or potential relationship between these actors; they fail to appreciate the upside potential as they deem the pool of profit to be largely fixed; they think in terms of ‘winning or losing’ instead of ‘growing and sharing’; and, finally, they do not let the ecosystem adapt to new circumstances.
Designing a pan-sectorial offering for end-users, identifying the various actors whose contribution is relevant to the delivery of such offering in a sustainable fashion, interesting them and getting them aligned is hard work. Nothing can be left to chance. A structured, methodological and disciplined approach must be intellectualized and implemented.
That is, in essence, what ‘strategy’ has become.