Business ecosystems are the new unit of analysis for strategic thinking; they offer fertile grounds for innovation. This article discusses how managers can map, analyse and take advantage of business ecosystems. It is illustrated by a nice case study inspired by the work done at Groupe Seb, a leader in Small Domestic Appliances and Cookware industry.
Business strategies should be established based on how a business ecosystem is likely to evolve, not on what we think we can excel at. Mapping and analysing ecosystems is about identifying, testing and selecting options to create and capture value. It is about forming new hypotheses and defining how they can be tested and implemented. To achieve this, a new approach is needed that will help to navigate the complexity and uncertainties of the business ecosystem landscape.
With the ongoing transformation of the business landscape, many industry boundaries have drifted, blurred and changed. New players emerge while other business activities are unbundled. Value chains are continuously sliced and reshaped. Radical innovation and experimentation are led by communities of small disruptive players while cost competitiveness has to be built on the back of existing and emerging champions that leverage scale effect. In between, collaborations with integrators and technology leaders can remain essential to succeed. In this context, thinking in terms of industry and value chains can be misleading; the business landscape is best described as a continuously changing ecosystem where some relationships and collaboration need to be abandoned while others need to be strengthened, initiated or nourished.
Evidence for this is plentiful. The automotive industry has to re-invent itself with the development of self-driving car technologies and the rise of mobility services. For many years the key players tended to work within closed circles. But now they turn to new players to access technology and capabilities that are new to the industry. In other industries such as banking or logistics, startups are challenging established players without disrupting the industry. This leads established and emerging players to simultaneously compete and collaborate. Utility companies need to co-create smart technologies with industrial science leaders in order to offer new business models and services. In the current economic and business environment, companies have to reconfigure their ecosystem of clients, suppliers and partners to transform their value proposition, their business models and secure new competitive advantages.
About the Authors
Hervé Legenvre is Professor and Global Executive MBA Director at the EIPM, a Training Institute for Purchasing and Supply Management. He manages educational programmes for global clients, conducts researches and teaches in the fields of innovation, and sustainability across the value chain. Hervé holds a PhD from Université Paris Sud.
Isabelle Herbet is Asia Purchasing Director for raw material, components and subassemblies for Groupe SEB, and specialist in Cookware and Small Electrical Appliances. She seeks to bring a Sustainable Competitive Advantage for the Group, managing Purchasing centers, Purchasing Performance & Operation and Category Management in Asia to drive Value creation to serve the Business.
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