Business Ecosystems

New technologies have shown us the advantages of networking and the possibility of combining distributed capacities to generate markets or create shared resources. Social networks transformed anyone into a content producer, as well as a promoter of their own services or products, enabling knowledge among peers and trust among strangers. Popularization of smartphones brought the ability to connect anytime and anywhere to everyone's pocket.

Nowadays, there are also different objects that are connected (watches, medical devices, bracelets, sport devices, etc.). Those that surround us like vehicles, machines, street furniture, etc. also join networks and generate very useful information for businesses.

Many businesses which have already realized that software is a part of everything, have changed their industries: the largest department store and bookstore (Amazon), the preferred form of music consumption (Spotify), the paid television service with the most subscribers (Netflix), the most acclaimed film producer (Pixar), the entertainment sector with the largest budgets (video games), or largest accommodation chain (Airbnb), are now digital.

This new way of doing business has a broader vision of its own ecosystem: they connect new nodes, integrate numerous resources from more diverse sources into their processes, make better use of the capabilities of their users/clients and, they share tools and resources so that others can develop their own businesses or ways of life. The advantage of these organizations is not in scale; it is in the expanded vision of what is available, in the design of the business model itself. They are designed to generate more value than they need to capture to survive.

Aleph is a concept that Quanam has created and developed within the framework of a strong commitment to innovation. It carries out the construction of network businesses. Building an Aleph for a certain area implies developing networks of companies and entities through the use of Information Technologies and Specific Methodologies.

Both, Aleph's conceptual framework and the development of the product that supports it arise from direct experience of having developed a networked market for the financial system with excellent results.

The conceptual framework takes as a starting point the creation of favorable contexts for those companies or new ventures that have the potential to activate online markets.

A favorable atmosphere or context for the creation of an Aleph consists in:

•  More agents than usual
• More knowledge than usual
• More distribution systems
• More financing systems
• More systems to crate and capture value

There are many other definitions for business ecosystems or network businesses but, essentially, they convey the same message: a group of elements that must work together for it to result in a collective success.

In the Aleph, we can appreciate five central elements that contribute to Gartner’s definition of a business ecosystem, seen in my previous post:

1 - Dynamics

The word dynamic is key. An ecosystem is not stagnant or latent, it is growing. Adapting to change can be a self-regulating mechanism provided by the ecosystem itself. It can also depend on other ecosystems to survive or grow.

2 – Network entities 

The ecosystem is made up of people, organizations and things which can vary from physical IoT sensors, to cars and applications. These can be referred to as participants, stakeholders, or actors. All the members of the ecosystem have a role to perform for the ecosystem to thrive, some will be leaders, other followers, orchestrators or partners. Depending on the complexity of the ecosystem, some members may play multiple roles. For example, leaders by providing value to some members, or some customers to others.

3 – Interacting

It is a really important part of the definition since without interaction you cannot have an ecosystem, on the grounds that this one will have several types of interactions, product/ service, contractual, financial, operational data and, most importantly, shared data among ecosystem members through APIs or microservices.

4 – Exchange and create 

Since the beginnings of time, human beings have created items and then exchanged them for something else. Within a business ecosystem, the collective ability to create and exchange products or services is enabled and strengthened through and by members to deliver value.

5 – Sustainable value

The value created and exchanged between members must be sustainable. Value is the benefit provided to members of the ecosystem through their membership. It can be measured as money, bookings, likes, customer satisfaction and better health. Those members that are not providing or receiving sustainable value, will not remain in the ecosystem and, based on their importance or role, the latter may become stagnant or die. In addition, achieving a sustainable value its possible through trust and the right business model. 

In most cases, these business ecosystems must be extended in order to include nodes outside the organization. Said nodes may include suppliers, industry associations, customers, and other competing or complementary organizations, as well as supporting data, devices, and infrastructure.

In this multi-year learning process, plus the incorporation of various methodologies we have perceive, in Aleph, at least six commercial “drivers” that raise the need for carefully defined and modeled ecosystems.

1. The speed of digital businesses requires organizations to work together to avoid becoming obsolete.
2. Ecosystems enable collaboration and cooperation among participants.
3. Companies will be able to leverage innovation much more efficiently and effectively by combining smart, innovative, problem-solving resources from different organizations to work together and deliver value.
4. Risks and benefits are shared across all the ecosystem rather than being isolated to a single organization or technology.
5. Business ecosystems allow the effective and efficient use of, sometimes, limited or emerging technological resources
6. A well-formed business ecosystem can allow small companies to compete against larger established companies, leaving no one intact or invincible.

These ideas have been put into practice with Aleph. It is no longer enough to understand the importance of a company's ecosystems and what they contain. Successful organizations must be able to shape their business to easily work in a network and connect using a business ecosystem like Aleph.