Increase Success by ‘Thinking in EcoSystems’

The strength of our ecosystems can determine the success or failure of our economies, our organizations, our entrepreneurs, and ourselves. However, many ecosystems underperform, and many fail that shouldn’t, because we are not fostering our ecosystems effectively. That means we are falling short of what is possible.

Since we all exist as part of ecosystems, such as our families, communities, teams, departments, businesses, organizations, supply chains, etc, we must think in terms of ecosystems.

This might sound complex, but by understanding ecosystems, we can understand what we control and influence, and recognize threats and opportunities sooner. By learning to think in ecosystems, we can actually make things easier, more enjoyable, and much more rewarding.

Table of Contents

1. What is a Business Ecosystem?
2. Forest Ecosystems Are Remarkably Similar to Our Communities
3. The Value of Ecosystems
4. What Business Ecosystems Can Learn from Ecology
5. Strengthening Your Business by Understanding Your Ecosystems
6. Conclusion

What is a Business Ecosystem?

Each of us belongs to several ecosystems at the same time for different reasons. When people speak about business ecosystems, they usually are referring to supply chain relationships, from suppliers to buyers. However, other ecosystems may include: the entire supply chain (‘from cradle to grave’), our organizations, our marketplace, and our industries.

Each business ecosystem has a unique purpose such as: creating stability, fostering collective growth, leveraging each participant’s unique strengths, and mutual protection or safety in numbers.

Depending on the purpose, we need to recognize the difference between a network and an ecosystem.

• A network is a collection of people or entities in symbiotic relationships. They cooperate or transact, by exchanging information, trading resources, giving preferential treatment to members, etc. Each member is expected to contribute equally. The value of a network is equal to the value of the transactions made.
• An ecosystem is made up of synergistic relationships, where each member contributes what they can, when they can, and there is an expectation of collaboration: improving outcomes by developing better solutions. The value of an ecosystem is equal to collective resilience, evolution, and sustainable growth.

Sometimes we need networks, and other times we need ecosystems. Most systems currently called ecosystems are actually networks (a collection of resources); this may be sufficient for the purpose. However, if we really need a synergistic ecosystem, we need to understand the nuances of ecosystems, so we can nurture them appropriately.

To understand ecosystems, we can turn to ecological research to understand ecosystems in nature.

Forest Ecosystems Are Remarkably Similar to Our Communities

A grove of trees can be a thriving ecosystem. However, research is showing that the ecosystem includes more than just trees.

Through their interconnected root systems, research shows trees provide support to seedlings, injured or stressed trees, and trees threatened by pests, animals, and natural elements. Trees share carbon, water, nutrients, warnings and alarm signals, defensive chemicals, wisdom, and hormones to each other and to the other flora in their ecosystem.

The more ecosystems share resources and learning, the stronger they are. And the most thriving ecosystems are the ones that are the most cooperative (sharing resources) or even collaborative (solving problems more effectively).

Interestingly, these ecosystems have positive and negative dynamics, similar (albeit slower) to human dynamics. For example, ‘stingy’ ecosystem participants are given less support in turn compared to ‘generous’ participants. And antagonistic trees will grow strong branches ‘at’ each other, while ‘friendly’ trees will grow together more elegantly. Generosity and friendship are rewarded and result in stronger ecosystems.

Ecosystems Have Far-Reaching Impacts

A critical part of an ecological ecosystem is what happens below the surface. For example, soil is a rich microbiome that is highly fertile and essential to overall environmental health. The 100’s of plants, animals, and insects in a forest depend on the trees and soil for survival and thriving, while concurrently contributing something unique to the survival and thriving of the ecosystem. And mycelium, an extensive fungal network that functions loosely like a ‘brain’ in the ecosystem. It is part of the communication and sharing system through the ecosystem (among many other functions).

However, the mycelium, soil, and other ‘invisible’ dynamics are often overlooked in ecosystems.

An example of the cost of this oversight comes from the forest industry. The Canadian forest industry does a lot of clear-cutting, which is economically very profitable. Clear-cutting is where every tree is cut down on huge sections of land, exposing soil, plants, animals, and insects to the elements.

An ecosystem that loses all its trees cannot survive because of soil erosion, degradation of topsoil, microorganisms, and mycelium. The remaining plants, animals, and insects are significantly weakened (or destroyed) by the loss of nutrition, support, and protection.

To mitigate clear-cutting, trees are planted. But without the nutrition, support, and protection of biodiversity and a healthy ecosystem, many planted trees die. It takes decades to rebuild the true diversity of flora, fauna, mycelium, and microbiomes lost to clear-cutting.

The interconnectedness of ecosystems means one relatively small change can result in significant chain reactions and cascading effects within the ecosystem. And there can even be negative effects on neighboring or downstream ecosystems, such as river systems, the atmosphere, and beyond.

No one can control the factors in the ecosystems as it is too complex. However, it is possible to influence the balance of the ecosystem so that it survives, evolves, and thrives.

The Value of Ecosystems

The Costs of Weak Ecosystems

A recent report shows early-stage ventures are generally more successful in various types of accelerators (ecosystems), in part because they can access more resources through the programs. However:

• those ventures usually started with more resources and competencies (ie they were already ‘winners’),
• most of those successful ventures don't believe they got much value from accelerators, and
• ventures that are not ‘winners’ to start with are not taught how to become more successful.

Most accelerators and other business ecosystems increase efficiency (condensing networks, smoothing access to resources, etc). However, there are very few examples of business ecosystems increasing the overall quality, resilience, and net value created by members and the whole community.

By not creating valuable ecosystems, our businesses, and economies:

• miss out on economic opportunity,
• incur significant opportunity costs,
• focus on ‘winners’, leaving potentially successful members behind,
• address complex problems ineffectively, and
• do not create and maintain competitive advantage.

The Benefits of Balanced Ecosystems

The greater the diversity of ecosystems and learning abilities in that ecosystem, the greater the ability to survive and thrive.?

Research shows that to survive and thrive ecosystems should be:

• resilient: able to maintain function and survive shocks
• adaptable: able to increase resilience by strengthening the ecosystem; and
• transformational: able to evolve the ecosystem collaboratively (or build a better one) in response to (or ideally, in anticipation of) bigger threats and opportunities.

Ecosystems Need Balanced Competition and Collaboration for Survival and Thriving

For a long time, academics and business people regarded forests as a collection of individual trees that are in competition for space and resources. This is now understood to be wrong.

Excessive competition and natural selection are evolutionarily unstable and exceedingly rare. Individuals acting purely competitively, and ecosystems allowing too much competition, will not survive over time. They will destroy themselves without artificial support.

Over the last few decades, research has clearly established the interconnectedness and interdependence of these ecosystems. Dr. Suzanne Simard describes forests as vast and intricate societies with conflict, negotiation (sometimes quite aggressive negotiation), reciprocity, and selflessness.

Thriving ecosystems depend on enough competition to stimulate innovation and growth.?But the success of ecosystems comes from co-learning and collaboration or reciprocal exploitation. The balance is the key.

Ecosystems exist on a continuum with pure individualistic competition at one extreme, and pure altruism at the other end. Both extremes lead to weak, unsustainable ecosystems. Thriving ecosystems are in the middle of these two extremes, where continuous individual and collective adaption and evolution are created.

In this competitive/collaborative environment, every part of the ecosystem:

• can take what is needed for survival,
• is nurtured not only to survive, but also to adapt and evolve, and
• is expected to contribute value for ecosystem vibrancy, including the adaption and evolution of the ecosystem.

Ecosystems in business are often thought of as arenas in which the fittest or toughest individuals survive. However, extensive research shows ecosystems are designed for survival and thriving – of all participants and the ecosystem itself.

What Business Ecosystems Can Learn from Ecology

Business ecosystems can learn from ecological systems. To build vibrant ecosystems, we need to strengthen diversity and learning, focus on the whole ecosystem, and learn to influence guide, not control the systems.

Diversity and Learning are the Greatest Strengths of Ecosystems

Diversity allows the diversification of perspectives which leads to more effective and relevant learning.

Learning from diverse experiences and perspectives requires being curious and thinking like an entrepreneur: being open to new ideas and processes so individuals and the ecosystem can adapt and evolve. Entrepreneurial thinking includes:

• continuous exploring for understanding,
• experimenting for learning, and
• exploiting to create value.

Thriving Ecosystems Focus on Creating the Conditions for Surviving and Thriving

The value of an ecosystem is to create the conditions so participants and the ecosystem can survive and thrive by fostering individual and collective adaption and evolution. The focus of the ecosystem should not be on finding and picking ‘winners’, but rather on growing collectively so the whole ecosystem can thrive.

If an individual becomes successful, they should be supported to continue thriving. But the health and vibrancy of the ecosystem and its participants should not be sacrificed for the benefit of the individual. And the successful individual must contribute back to the ecosystem that nurtured them so more – and more varied – successes can be fostered.

The purpose of the ecosystem is to create an environment where more participants can thrive. This means each participant must be supported in their learning, adaption, and evolution, including creating the conditions where each participant can take responsibility for achieving their potential.

The ecosystem must focus on removing roadblocks and barriers so each participant can learn to survive and thrive – individually and collectively.

Ecosystems are Complex and Ambiguous – They Need Influence, Not Control

Ecosystems are complex systems, which means there are many dynamics that cannot be observed. Dynamics can be linear, but they are usually direct and indirect, simultaneous, reciprocal, and so on. Complex systems are self-organizing, meaning individuals respond to change and opportunity by balancing self-interest and their relationships with others and with the whole ecosystem.

Therefore, managing ecosystems depends on experimenting to find out how to influence the system, rather than trying to make change directly. Attempts to make change directly almost always result in unintended consequences – and they’re usually not good. Since it is impossible to foresee all possible results of interventions, a light hand, curiosity, and an entrepreneurial mindset (explore, experiment, and exploit) are needed.

Strengthening Your Business by Understanding Your Ecosystems

We all work in formal and/or informal ecosystems, including.

• political, economic, and social ecosystems from which trends influencing our business emerge;
• industry and supply chain ecosystems;
• our clients’ ecosystems;
• our specific social, economic, technological, and geographic ecosystems; and,
• our stakeholders’ and our own personal ecosystems.

Because of the complexity, we will never be able to predict what happens in our ecosystems. To work with and manage our ecosystems well, we need to:

• understand them (through curiosity and exploration including questioning, mapping, etc),
• experiment (to figure out how to influence the ecosystem), and,
• capture value (exploiting the learning to adapt and evolve).

The better we understand the nature of our systems and their dynamics, the more we will be able to create ecosystems that ensure we survive and thrive.

Ecosystem Thinking at the Personal Level

To develop our personal abilities to lead ecosystems, we need to develop our:

• Curiosity
• Thinking in systems
• Entrepreneurial mindset
• Innovation mindset
• Mitigating bias
• Ability to collaborate
• Creative conflict ability
• Body wisdom to leverage the power of our physiological systems

Ecosystem Thinking at the Team Level

To develop our leadership abilities to lead ecosystems, we need to develop our:

• Psychological safety
• Resilience
• Co-Creating strategy
• Creating Change ?
• Project Management that includes humans
• Assigning effective ownership
• Graduated creative conflict
• Alignment in motivation

Conclusion

To create broader, more sustainable success in our business and for our economy and society, we need to develop healthier and more vibrant ecosystems. Ecosystems need to have a balance between competition and collaboration to stimulate innovation and growth.?

The interconnectedness of dynamics within ecosystems means one relatively small change can result in chain reactions and cascading effects. These complex dynamics mean no one can control the factors in the ecosystems. However, it is possible to influence the balance of the ecosystem so that it survives, evolves, and thrives.

Since it is impossible to foresee all possible results of interventions, a light hand, curiosity, and an entrepreneurial mindset (explore, experiment, and exploit) are needed.

It can seem overly complex and nebulous at first, however, if we develop the personal and leadership skills for leading ecosystems, we can develop thriving ecosystems that raise everyone up and create the conditions where everyone can survive and thrive.

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