A tropical rainforest seems a million miles away from the world of business, but they have more in common than you would think. Both are complex ecosystems consisting of different actors who constantly interact with each other.
- A natural ecosystem is about relations between living organisms like animals, plants, and fungi, supported by the surrounding physical environment: water, soil, air, temperature, and light.
- Business ecosystems evolve around the interaction between stakeholders like customers, suppliers, and competitors, supported by economics, law, and finance.
Different ecosystems, same concepts
Talking about business ecosystems is more than just a metaphor. Over the last decennia, much research has been done to find out what businesses can learn from nature. Terms such as environment, niche, life-cycle, or adaptation have become part of the common business idiom. That is only logical as all ecosystems rely on the same concepts:
- The different actors in an ecosystem depend on each other and continuously respond to each other. This constant interaction gives the ecosystem its own dynamics and the ability to scale. A natural ecosystem has no clear boundaries, and it may expand or shrink over time depending on the balance within the system of its environment. In a natural ecosystem, all organisms are equally important and have an active role in keeping the circle of life closed. The same applies to business ecosystems. The ecosystem can only grow and thrive if all stakeholders contribute to the production chain. If the balance within the network is disturbed, e.g., because one of the suppliers fails to deliver, it negatively impacts the complete system.
- As natural ecosystems face challenges like climate change and pollution, business ecosystems face challenges like deteriorating economic climate or emerging disruptive technology. In both cases, flexible ecosystems are needed that adapt rapidly to changing circumstances. The most vital ecosystems are self-reliant and always in close contact with their environment and adjacent ecosystems. This connectivity is required to build resilient ecosystems.
- A healthy ecosystem needs diversity: different functions that complement and strengthen each other. A diverse ecosystem copes better with problems as it offers the chance to spread risks and grow organically. A great example is the business ecosystem that Microsoft has created. It involves a vast range of services and products actively engaging different communities and technologies. This multi-disciplinary approach enables Microsoft to use its resources to stay competitive by constantly creating new business opportunities and finding new ways forward.
How to develop your business ecosystem
Natural ecosystems don’t follow a clear plan as they emerge naturally and follow their own unique course. A business ecosystem doesn’t arise spontaneously. The stakeholders always have a common interest: exploring new markets, creating new industries, or adding more value to existing ones. All partners in the network have a common interest that determines their roles. These may even shift over time. Clients who want personalised, free services become producers of data. Competitors join forces and become business partners to cut costs and raise profits.
For you as a service provider, it is crucial to be aware of the different business ecosystems and to know how to use them to achieve your ambitions. By partnering with Microsoft or AWS, you can benefit from economies of scale and focus on specific services or industries. This way, you can find your niche and find new ways forward.
At Insight, we help service providers realize their business ambitions in a multi-cloud world. As a multi-vendor software licensing, workload, and cloud platform specialist, we can guide you through all stages of your strategic cloud journey. We help you accelerate your business no matter where you are in your journey. Contact one of our cloud specialists for a talk.
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