By: Angus Ward
2021 was undoubtedly the year in which the science of building a partner ecosystem became mainstream due to the demand for solutions to fuel the digital transformation journey.
Fast forward to our current post-pandemic phase, which has taken us directly into a period of inflation, forcing businesses to become more cautious with their resources. Trying to control expenses while continuing to grow revenue, launch highly innovative and compelling new digital offerings, and improve overall customer satisfaction has at times felt antithetical and caused a reverberation of frustration among key players and other stakeholders. . For some organizations, growth has stalled, or even worse, reversed.
Halfway through 2022, we are seeing more of a meeting of the minds: companies are embracing this challenge at full speed, embracing their digital transformation plans by implementing technology solutions that are easy to try, easy to buy and easy to consume ( say “out of the box”) and which produce an often immediate and measurable financial return. Cutting-edge technologies such as 5G, edge computing, cloud, IoT, AI, ML, DLT, robotics, drones and many more are proving to offer significant benefits to improve productivity and operational efficiency.
While this may seem like a transparent strategy at first glance, it presents a real process challenge for companies’ existing solution providers. Habits are very often hard to break, and until the pandemic hit, companies followed traditional, stilted, time-tested ways of working. In the past, they may have adhered to the standardized model: focusing on selling standardized products using standard pricing. Fast forward to mid-2022 and now, to retain their enterprise customers, the keyword is no longer standardization. It’s rather
adaptation, where businesses must now continuously adapt to be able to offer comprehensive solutions and services that will drive digital transformation. This is often coupled with the added concern that the courage to do so, especially as a globally deployed service on the cloud, is usually much larger than what their organization can provide.
The key to mitigating risk and meeting these challenges while continuing to grow revenue and delight customers and partners is to evolve the traditionally standardized business model to sell multi-partner solutions, co-created within a community or an ecosystem. To continue to build customer loyalty and win new customers, this is the logical next step for many solution providers. This will allow them to better meet the needs of all key stakeholders, while allowing them to federate costs, risks and expertise within their ecosystem of partners.
The success of an ecosystem is measured in terms of achieving a minimum viable community (MVC) of like-minded ecosystem partners around a digital business platform in addition to the marketplaces that underpin them. This synchronized community is necessary to self-perpetuate the ideation and co-creation of cutting-edge, often disruptive solutions that enterprise customers want to purchase to advance their digital transformation. This network effect creates choice and economies of scale for providers within the ecosystem; in effect, a winner-take-all or fly-by-night scenario. The ecosystem fuels a better understanding of customers, which fuels new revenue opportunities.
Although the anatomy may be clear, there remains a lot of uncertainty or even confusion about how to make the ecosystem model work and where to start – inside out or outside in. inside?
The key is to always start with the customer and the problems they are trying to solve. This “pull” solution requires product managers with the right mindset who can resist the temptation of “push” product models, such as AppStores, offering largely “me-too” software libraries, each having limited uniqueness or value. In this same “push” category are the horizontal components that force client companies to bear the cost,