Corporate Education Group

2 | Curing Ecosystem Blindness 300 Brickstone Square • Suite 201 • Andover, MA 01810 USA • 1.800.288.7246 • +1.978.649.8200 • info@corpedgroup.com Curing Ecosystem Blindness Ecosystems are complex and ever-changing. While it is impossible to fully map an ecosystem, leaders can develop insight into the dynamics and interdependencies of their ecosystems. To begin understanding your ecosystem, start by identifying entities. Ecosystem entities are organizations that your company depends on in order to do its business. Entities can include supply chain partners such as suppliers and distributors. However, the ecosystem approach goes beyond the traditional supply chains to examine the more complex web in which a company operates. This web includes the networks, resources, people, and ideas that fuel your company. To identify entities in your business ecosystem, ask these questions: 1. What and who does the company depend on in order to operate? Most companies have hundreds, if not thousands, of companies, people, ideas, and materials that are critical for its operations. Start by listing supply chain partners. Then consider other entities that provide critical resources, services, or ideas to the organization. For example: • The government recognized years ago that spouses of enlisted soldiers make up an important part of the military ecosystem and need support services. • Pharmaceutical companies require patent attorneys, researchers, and clinical trial participants in order to be successful. • Hollywood's ecosystem contains the obvious actors, directors, producers, and cinematographers, but also relies heavily on the media to promote its products. 2. What companies must succeed in order for customers to use the company's products and services? In an ecosystem, other companies must succeed in order for an organization to achieve its goals. For example, Michelin cannot sell tires unless people buy cars. Century 21 won't make its revenue targets unless banks grant home mortgages to prospective buyers. Once you have a list of critical entities (don't aim for an exhaustive list — it will take too much time and it will probably change before you've finished), look at the role each plays in the ecosystem. • Keystones.¹ Keystone organizations are the centerpieces of the ecosystem, generating metaphorical food for others. They accept a broad view of success by inviting partners to expand, grow, or innovate on their core products. Microsoft is a good example of a keystone organization. It creates products, such as Windows and Microsoft Office, that provide sustenance and livelihood to the many organizations that have emerged to support them. For example, software companies develop specialized packages to run on the Windows operating system. Trainers, resellers, developers, and system integrators all benefit from their association with Microsoft. • Niche Players. Niche players grow in relation to the keystone organization and profit from their proximity to it. Each niche player develops a specialized place within the ecosystem, developing unique products or services that fulfill a particular need. For example, Priceline.com carved out a specialized niche by offering online bidding for low-cost airline fares. The company couldn't exist without Southwest Airlines, American Airlines, and their competitors. Yet Priceline developed a sweet spot for itself

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