Share this content
MyCustomer.com

Corporate ecosystems: Building alliances to better serve customers

by
29th Sep 2008
Share this content

Organisations are increasingly forming alliances and networks to address customer needs more adequately. William Buist explains how these 'corporate ecosystems' operate and discusses his own experiences of working within one.

Corporate ecosystems

By William Buist, Abelard Management Services

When a child is born it starts an independent life, but is wholly dependent on its parents for many years, until it reaches the teenage years, where it seeks to shake off dependency and demonstrate its own independence. Soon enough though teenagers see the need for others and start to build relationships and interdependence with (rather than dependence on) others by creating families, joining communities, etc. This in an example of the human ecosystem.

"The areas of expertise that a single business can cover is limited unless, of course, they exist within a collaborative group of businesses who can support each other and provide the expertise required at the right time."

William Buist, Abelard Management Services

When we talk about corporations (derived from the latin word ‘Corpus’, meaning body), we allow businesses to enter into contracts on the same basis as we would with an individual. Perhaps we should not be surprised that businesses too start life as highly dependent on others, and that they find independence as they grow, and then, in their own ecosystems, find the fellow businesses that will support them. They form synergistic groups and businesses become interdependent in an ecosystem comprising the markets, staff, suppliers, customers, associates, shareholders and partners with common fellowship, travelling on a shared journey.

No business can be an expert in all areas of its chosen markets. Expertise is earned over years of experience and the application of skills learned throughout our working lives. That then becomes complicated because the markets, suppliers and customer needs all change around you.

The areas of expertise that a single business can cover is limited unless, of course, they exist within a collaborative group of businesses who can support each other and provide the expertise required at the right time - a corporate ecosystem.

A recent survey conducted by BusinessWeek Research Services (BWRS) and commissioned by SAP AG revealed that organisations are increasingly turning to collaboration with their business networks as a way in which to win new markets and address quickly evolving customer needs. The report, 'Getting Serious About Collaboration: How Companies are Transforming Their Business Networks', found that roughly half of the respondents said they are currently counting on partners for R&D, manufacturing, marketing, logistics, distribution, customer service or other corporate functions.

Moving from independence to interdependence

In a recent article, Maya Townsend agrees that rather than stand-alone players battling for market share, companies are today forming networks and alliances and collectively deliver value to their customers. By way of an example, she highlights how Salesforce.com opened its Force.com developer site, building interdependencies with organisations such as CRMfusion and Electronic Arts; and how Keane has created a dual-sourced IT workforce with Miller Brewing Company.

"A recent survey revealed that organisations are increasingly turning to collaboration with their business networks as a way in which to win new markets and address quickly evolving customer needs."

It’s worth thinking about the things that facilitate interdependence and then consider what aids the movement towards interdependence. Interdependence in the context of collaborating businesses means that each business is stronger because of the collaborations. The relationships that exist between the businesses allow all of them to act as if they were one, rather than many. In my own business, Abelard Management Services Limited, a number of interdependent partners collaborate to deliver to our clients.

As a group of independent businesses we could just compete with each other to deliver the same outcomes for each client, with each business bringing its expertise to bear and deliver to the best of its abilities. But by collaborating, each task has the best expert from the group focused on delivery. That’s a better result for all the clients and that means more referrals and more repeat business in the group as a whole.

Developing a community

Before any business would be prepared to partner with another and entrust their brand to others, it’s almost inevitable that a relationship between the people involved will need to developed in order for them to deeply trust each other. Nothing can happen until people are aware of you. Only by building awareness can we hope that others will get to know us and start the journey to trust, and partnership and trading. Most won't stay with us for the whole journey, but none of the people who fail to start will be there at the end!

"Before any business would be prepared to partner with another and entrust their brand to others, it’s almost inevitable that a relationship between the people involved will need to developed in order for them to deeply trust each other."

Building awareness is about being visible, within your chosen spheres, in your market and in the network of people that you know. Awareness of you attracts potential collaborators to get in touch and start conversations. Here is where you find the synergies, the overlaps and common ground, in the products and services that you have.

In my business, a client who needed to tender for a supplier (as part of a project) where we could easily support them with elements of it led us to partner with another business for other elements of it. Their skills were a great complement to ours, neither of us could have supported the whole project as well individually as we did together, although either of us could have done it alone. As a result of our collaboration, we were awarded two other larger projects from that same client.

There is a point in the development of any business when it trusts its environment, and is prepared to reach out to others to start to form relationships. Demonstrating a desire to work with others who may distrust your motives is hard, but being true to the end goal of mutual support and seeking the opportunities to work as a team will soon bring rewards. The ecosystem evolves into existence, it doesn’t suddenly appear. Some will lead the way, others will follow looking for tried and tested results before they join in, and some will lag behind. That too is human nature.

The business ecosystem is growing up

All of that may sound like it’s a wonderful world where there is less need to undertake the usual checks that you would do in business - and over time that may be true, when trust is really strong. Until then, though, it’s worth retaining all the usual business controls such as due diligence, contractual agreements and clear financial structures.

"Small dependent businesses have learned their skills and gained experience as independent organisations are now seeking others and collaborating in new ways."

When businesses work together, the financial arrangements are often less clear. In our group we consider not just the costs of delivering the product, but the costs of marketing and sales and the costs of operating the businesses themselves, where the costs of credit lie and who carries the risks. These aren’t simple questions and shouldn’t be left on trust. They need agreement and understanding if the ecosystem is to blossom, for without that level of understanding distrust can soon grow.

Now our business could not survive in its current form without the ecosystem in which it operates - we’d fail to develop and grow as fast as we are and we’d fail to deliver the service we now can. Small dependent businesses have learned their skills and gained experience as independent organisations are now seeking others and collaborating in new ways. Their interdependence, whilst still adolescent, hides the truth of 21st century organisations, not one or few, but many working with each other as one.

These changes are fundamental and radical, embracing it is critical and yet this new business ecosystem will evolve further and faster than most are prepared for.

William Buist is director of Abelard Management Services, a consultancy specialising in improving team dynamics and performance. For more information visit www.abelard-uk.com

Replies (0)

Please login or register to join the discussion.

There are currently no replies, be the first to post a reply.