From ecosystem mapping to sizing the opportunity:

In one of our recent editions, we looked at a challenge many organizations face. They recognize the shift from hierarchical businesses operating in industry silos, to networked ecosystems, which cross industries and present new opportunity spaces- yet their map, pointing them to the opportunity has often aged.Their early, proactive stance was taken over by organizational busyness and short-term priorities, resulting in inertia, and so when the opportunity presents itself, they find their map isn’t as useful anymore. To seize the opportunity, they need a new map.?In this week’s edition of Challenger Moves, we look at the next step in this process. Imagine having an accurate map of this evolving ecosystem and so we can zero-in on where the opportunity can be found. But do we know how much is the opportunity is genuinely worth? Without that, how would we gather management support? What goals could we set? and would these inspire our people to achieve what may seem out of reach to the many??That is where market sizing becomes critical. Not in the traditional sense of a business case in a vertical market (there are truly only few of those left) but in a dynamic landscape in which the opportunity rests - for those who can respond with speed and agility. Here is how it could work in practice.This week, we had James Mnyupe, Advisor to the President of Namibia, present at our Challenger CEO forum. James is fellow challenger and a member of our community. He shared with fellow CEOs the journey of Namibia towards a Hydrogen economy. Just to give you a sense of the opportunity, the first project alone is estimated at 10Bn Euros, approximately 70% of the country’s GDP, and offers a host of potential opportunities, where green industries take shape in the country, amidst an ecosystem of global partners, from technology providers to off-take, customer agreements, and more.?Sizing the opportunity, to its fullness, required a new approach. In our conversation, three (3) aspects stood out for me, as learnings:

1. Size the opportunity to its fullness - not merely as a collection of business cases, but, to James’ words, exploring it in its fullness - in his case, de-carbonization and cross-industry possibilities. This should be done with others, not on one’s own. No one has the full version of the truth when it comes to an ecosystem that is emerging, and so we craft a narrative which invites others to step in and participate in the exploration process.Namibia could be considered a small country, far away from global energy markets, but equally it should be seen as an innovator - a challenger nation, ready to reinvent itself and before a partner to developed nations, aiming to de-carbonize hard-to sectors. Both versions of the country are true, both incomplete , and filling in the missing pieces, would help to discover new, sometimes surprising opportunity spaces.
2. Incorporate alternative data for a clearer picture of the opportunity, and what could stand in the way - sizing an ecosystem is often challenging because traditional data sources are often relevant but no longer sufficient. We need new sources, which cross boundaries - from internal data to data found entirely in your customer space, from global to local, and from regulated spaces to unregulated or under-regulated aspects of the opportunity (think EVs, where old and new industries collide). Those who are willing to bring in alternative, fresh data into their models, can more rapidly provide up-to-day and more compelling views of the opportunities and - standing at some distance for perspective, the fullness of the ecosystem - sometimes in orders of magnitude larger than originally seen.
3. Validate where economic value is exchanged - This step can take us out of our comfort zones, the familiar, neat spaces in which markets are assessed and business cases are built, to the messy reality which awaits us - and when it comes to ecosystems, it can get rather messy, still forming and continually changing shape. Those who size the opportunity, we find, experiment not merely to test the technical feasibility of solutions, but experiment to discover the multiple ways in which customers, commercial partners and even our own people, interact.

Zero distance is a useful concept here. Organizations that developed the ability to experiment, in market and incorporating partners, who can contribute capabilities and closeness to customers, sometimes both, are at a distinct advantage here. Keeping our opportunity ecosystems up to date is important, no doubt. Seizing the opportunity requires us to size it, for an effective approach - sometimes a high-level estimate is all we can do, other times a more involved effort and alternative data sources are readily available.

Sizing the ecosystem provides you with a valuable tool, to turn a market hunch, discovering an opportunity, into one you can actually seize - and do so again and again.

Have a good week ahead.