- Introduction: Ecosystem Disruption: When Boundaries Collapse
- Ch 1: Winning the Wrong Game Means Losing
- Ch 2: Ecosystem Defense Is Collective
- Ch 3: Ecosystem Offense: From Adding Competition to Changing Competition
- Ch 4: Timing Ecosystem Disruption: Too Early Can Be Worse Than Too Late
- Ch 5: The Ego-System Trap
- Ch 6: Mindsets Matter: Establishing Leadership is Different from Exercising Leadership
- Ch 7: Strategic Clarity Is Collective
- Afterword: Confronting Ecosystem Disruption beyond the Private Sector
Ecosystem Disruption: When Boundaries Collapse
The basis of competition is changing. Are you prepared? Rivalry is shifting from well-defined industries that deliver clear products and services to broader ecosystems that deliver expansive value propositions: from cars to mobility solutions; from banking to fintech platforms; from pharmacies to health management centers; from production lines to intelligent factories. Industry boundaries are collapsing everywhere you look, and the trend is accelerating.
This book is not yet another wake-up call. Indeed, today’s leaders are already wakeful to the point of insomnia. For many, however, wakefulness has added confusion rather than clarity. Why? Because as competition has spilled beyond traditional boundaries, their strategic challenges no longer fit within their strategic frameworks.
Classic disruption was industry disruption. Modern disruption is ecosystem disruption.
Ecosystem disruption occurs when the introduction of new value propositions impacts competition across industries, erasing boundaries and overturning structure. Traditional rivals pursued the same prize with clear winners and losers; today’s challengers are pursuing different goals and focusing on different metrics as they wage their attacks. Traditional rivals focused on their own execution to gain advantage in cost and quality; today’s challengers assemble new sets of partners to create value in ways no individual firm could hope to deliver.
Ecosystem disruptors are not just adding competition, they are redefining the foundations of competition: they are changing the game. Whether you are attacking new markets, or trying to repel these attacks where you live, you need a new perspective on competition, growth, and leverage. Success is no longer about simply “winning” but about making sure that you are winning the right game.
With this book I make a simple promise: I will show you in detail how to play and win in the new ecosystem landscape. This is not about technology, or vision, or risk-taking, although they clearly play an important role. Rather, it is about a new approach— a new playbook—for strategy when boundaries are shifting and rules are changing. Even if you already have a sense for the right answers, the concepts and language provided here will help you connect the dots of your own intuition and— perhaps more importantly— help you connect the dots for others, making it easier for them to follow your logic and your leadership.
At its heart, ecosystem strategy is about partner alignment. Customer insight and great execution are the necessary but no longer sufficient drivers of success. As delivering your value propositions has become more dependent on collaboration, finding ways to align your partners has moved to center stage. In industries, working with partners meant mastering supply chains and distribution channels—everyone understood their role and position. In ecosystems, the challenge is aligning critical partners whose vision of who-does-what may vary dramatically from your own.
This means that the notion of winning itself must become more nuanced. Winners in industries dominate at the top. Winners in ecosystems can create and capture value from a variety of positions, and choosing where to play is just as important as what, how, and when to play.
So much of what we could comfortably assume in a world of industries is overturned in today’s world of ecosystems. But with a change in perspective, we can see new dimensions on the game board that let us ask new questions and craft new approaches:
- How can you identify the shifts that will disrupt your ecosystem, turn partners into rivals, and undermine your ability to win?
- How can you drive ecosystem disruption to collapse boundaries and upend established competitors?
- How can you stand your ground against ecosystem giants, and even thrive in the aftermath?
- What is the unique advantage of established firms in playing the ecosystem game?
- How can you predict the timing of ecosystem disruption—when the window of opportunity will open, and when it will close?
- How can you safeguard your role in an ecosystem and avoid the ego-system trap?
- How must the way you select and develop individual leaders change in the context of ecosystems?
For startups, getting these questions wrong manifests as painful pivots—attempts to reposition themselves in the market, not understanding that the key to success is not a different value proposition but rather a better approach to aligning the partners that will give life to their offer. For large corporations, it manifests as endless pilots—attempts at creating new value that succeed in their test-site demonstrations, but fail in the commercial market when partners refuse to scale on the terms you had envisioned. For all organizations, the pain results in hard work, by good people, that never gains the traction it deserves.
More broadly, we have entered an era that calls for a holistic approach to value creation from organizations. The rise of stakeholder capitalism compels firms to recognize their roles and responsibilities in their communities and society at large. Rising to meet this challenge, and turning this requirement into an opportunity, demands an ecosystem-based approach.
In the chapters that follow, we will develop a new perspective, and a new set of principles, for developing effective ecosystem strategies. Our focus is on how to compete, collaborate, and coexist when opportunities and threats no longer respect traditional rules or boundaries. We will dive into illustrative cases that range from familiar tech firms to stalwart incumbents to nimble startups to draw out the meaning and nuance of these principles. The cases will present the facts of how things unfolded. The frameworks will offer a logic for understanding why they unfolded as they did, and how to consider alternatives when you find yourself facing similar situations.
Every case that we explore involves firms that were either born digital or that, as incumbents, had already embraced digital transformation. They all offer lessons—positive and negative—that demonstrate why addressing ecosystem disruption entails not just “becoming digital” but rather mastering what comes next. The plan of the book is summarized in figure I.1. All source material is referenced in the backmatter.
Organizations differ in their specifics. For this reason, answers regarding strategy are rarely right or wrong in a universal sense— a strategy that is great for one organization may be disastrous for another. Strategies very clearly are, however, better or worse in terms of consistency and fit. What matters then, is crafting strategy that suits your firm, and communicating it persuasively enough to drive coherent action across the organization.
The tools and methods in this book offer a language for understanding and articulating strategy in ecosystem settings. They are the combined product of a decade-long journey through research and practice, tested and validated through scores of client engagements ranging from startups to Fortune 100 firms to nonprofit organizations to government entities. They are robust concepts that can become very powerful if you actively apply them to your context. As you progress through the book it is critical to read beyond the cases to actively consider the implications for your own organization: Who are you in the story? Where is your strategy consistent with the principles? Where does it contradict? Where do you feel most and least comfortable with the difference? Most importantly, what must you do to bring your team and your organization along to the same level of understanding?
Everyone is playing to win—the key is to be sure you are trying to win the right game.