All organizations must continually evolve and innovate to survive and thrive, and a business ecosystem encourages those operating within the ecosystem to cooperate to catalyze innovation and develop the members of the ecosystem. Furthermore, a business ecosystem drives the most benefit and value to the customers and clients the members of the ecosystem serve.
In a previous blog, "Ecosystems: A Community of Resources", we cited large corporations that benefit from a business ecosystem. For example, consider the Apple iPhone. Apple is the conductor of an ecosystem, bringing together component suppliers, app developers, and telecom providers. Additionally, the App store is a marketplace for selling apps that benefit the consumer. However, for many small businesses, an ecosystem of subject matter experts provides benefits and value to the organizations they serve and, more importantly, to the clients and customers that the organizations serve. The fundamental core principle of an effective business ecosystem is rooted in client-centricity. Each member of the ecosystem is driven to prioritize and serve their customers and clients.
However, business ecosystems support and guide small businesses in navigating basic business functions.
Ecosystem Impact on Basic Business Function Example
A small business has contracted with an IT-managed services provider (MSP) for approximately four years. The small business changed and evolved throughout the four years considerably. They depended on the MSP for predominately help desk support, cybersecurity, and software office products. When their contract came up for renewal they reached out to their ecosystem to help them evaluate the contract and the services they were offered. Their ecosystem offered the following questions about the MSP contract or service:
- All of the services that the MSP provided were through 3rd party services, so the ecosystem presented the question, "What additional value did the MSP provide to service?"
- If you are saving everything to a cloud-based service, why are you paying to back up those files on another cloud-based service? Are you trying to protect yourself from a user who deletes key data or a security breach?
- What benefits have the help desk provided the business? What type of help was most often sought?
From the questions that were asked, the small business was able to understand the ecosystem the MSP relied upon:
- A SaaS company offering a suite of office software and cloud services
- A third-party offering threat response and detection service
- A third-party offering encryption
- A third-party offering firmware
- A third-party offering email management and SPAM filtering
- A third-party offering patching and warranty management
- A third-party offering cloud and data backup services
The MSP created an ecosystem of products and support services to be provided to clients with similar needs. However, it is important to note that in the context of this example the small business had a contract with this MSP for approximately four years. The technology industry rapidly changes, so the "why", "what", and "how" of what the MSP offered needed to shift, as well. Five years ago, a small business couldn't buy OS365 directly. A small business would have to go through an MSP. Help desk support is often provided directly from the manufacturer, unlike five years ago, and software support is also provided directly from the software manufacturers. Therefore, a small business can get the same service that the MSP provided in a different way and at a lesser cost, which helps cash flow and the bottom line.
The question the small business needed to answer was, "Does my small business benefit from the ecosystem of IT technology services that this MSP created and conducts?" The answer to the question was "no".
There are three lessons to be learned from this example:
- Having an ecosystem to turn to that contained IT and technology subject matter expertise equipped the small business to make an appropriate decision for their small business.
- Ecosystems are built to serve similar clients and customers. As a consumer of products or services, evaluate the ecosystem that the provider of the products or services relies upon, and then evaluate whether your organization is the type of client or customer that the ecosystem collaboration serves.
- An ecosystem must collaborate and innovate together as the needs of the clients and customers change and the technology evolves, or the ecosystem may no longer provide value to its members or to whom the members serve.