Want Faster Growth? Use Ecosystems to Your Advantage

Posted By Dan Caplinger, Tuesday, July 13, 2021

Adopting ecosystems is a proven way for businesses to grow faster. But how to do it? With the rapid pace of digital transformation, actually implementing an ecosystem strategy within a company’s broader vision of partnering presents major challenges. Cybersecurity, intellectual property issues, technology integration, and committing to serve customers first while aligning corporate cultures between alliance partners can make or break new ecosystem projects.

Fortunately, innovative technology and smart cultural integration strategies can make it easier for businesses to take advantage of the opportunities that ecosystems provide. In their ASAP Webinar on June 10, 2021, “Creating Effective Ecosystems Through Innovative Technologies and Changing Culture,” panelists Paul Hengeveld, Claudia Kuzma, CA-AM, and Chris Pogue joined moderator Nancy Ridge to talk about how successful companies are addressing and overcoming potential obstacles while achieving new solutions through platforms, software, and collaboration.

What Are Ecosystems, and Why Do You Need Them?

Ridge, founder and president of consulting firm Ridge Innovative, started out the presentation by introducing the concept of ecosystems. She noted that in business, ecosystems involve an actively managed network aligned by a shared set of values. Ecosystems need governance, orchestration, and an underlying framework and technology to work effectively.

Ridge works with clients to come up with a balanced approach in assessing the complexities of ecosystems and alliances. She said her company adds the most value by finding qualified partners and technologies that will fit with each client’s needs, avoiding potential pitfalls and allowing ecosystems to assist in achieving business objectives.

Mosquitoes, Elephants, and Hedgehogs

Ridge then turned to Chris Pogue, who is head of strategic alliances at Nuix. His Nuix Partner Connect ecosystem brings together more than 150 partners across 74 countries around the world.

Pogue explained that as an independent vendor of investigative software, Nuix relies on global partnerships. He listed several different types of partners the company uses, including alliances based on distribution, training, legal services vendors, investigations partners, and advisory companies. Some are tiny players in the ecosystem—“mosquitoes,” as Pogue called them—while others are highly influential—“elephants.” Some may play both roles in different situations. But it helps to know what you are, and your capabilities, and all types and sizes of partner have a role to play.

Pogue referred to the Jim Collins book Good to Great in explaining Nuix’s approach. “We know what our hedgehog principle is. We know what we’re good at and what we can be the best in the world at. The more granular we can make that, the smaller we make that mission, the more we can deliver on it.”

As Pogue explained, that means there’s a lot that Nuix doesn’t do. It doesn’t seek to have worldwide scope, it doesn’t create all of its software in-house, and it doesn’t have a services arm. Instead, Nuix has seen the necessity of having a strong partner ecosystem to handle those essential aspects of a successful business.

Pogue’s 25-year career includes service as an officer in the US Army, and his military background taught to him to focus on results. “We look for outcomes. I don’t care necessarily who’s on my team; I just want the right people doing the right things to get the right outcome,” Pogue said. “So as a commander looking across the battlefield, I have specific things that I know I need. … I don’t provide all those, but I have to find the people who do to enable me to accomplish the mission. The ability to translate that into the business world is really no different.”

By recognizing the needs of customers, Nuix is able to back up and get a big-picture perspective. Then, it can create an ecosystem to meet those customer needs.

Where Alliances and Ecosystems Come Together

One of the partners Nuix works with is advisory and consulting services provider Protiviti, where Claudia Kuzma is managing director and global ecosystem program leader. Since joining Protiviti, which is a subsidiary of global human resources and staffing consultancy Robert Half, Kuzma has had the dual role of building out the company’s own ecosystem program while also focusing on its clients’ ecosystem needs.

Kuzma identified several areas in which Protiviti offers key assistance in developing ecosystems. Education is a vital first step, paving the way toward evaluation of candidate alliance partners and further vetting of ideas. From there, refining the market opportunities, reviewing alliance plans and drafting contracts, and then working to implement and continually grow relationships creates a positive feedback loop nurturing alliances.

However, there are also challenges, especially when it comes to technology. Kuzma described the questions she has to answer in evaluating alliances: “How can we deliver a joint solution together and still protect our IP? How can we enable our vast resources across the board? Because business climates are dynamic, they’re constantly changing, there’s complexity.”

“It Needs to Be Open”

Addressing those challenges is where TIDWIT comes in, and the presentation then turned to Paul Hengeveld, TIDWIT’s head of cloud ecosystems. As Hengeveld explained, when you consider all the partners a typical company has, point-to-point integrations become very complex. Ecosystems can help connect multiple partners through networks that simplify interaction.

TIDWIT helps create those point-to-network connections by bringing together multiple layers. From interfaces and applications to networks, data, and automation, Hengeveld noted, TIDWIT can help companies integrate all kinds of resources without making their interactions too complex.

One of Hengeveld’s key takeaways was that there’s a tug-of-war between some software providers and the ecosystem community. “Especially with the big players, they build their own big systems,” he said. “They thought this is how it needs to be. But then some people said, ‘No, it needs to be open. We need to be able to take data out of the system, we need to be able to integrate with it.’ So now, open is the standard.”

“We Have to Put the Customer at the Center”

Ridge highlighted a key aspect of ecosystems. “If we are truly looking to create an effective ecosystem,” she said, “we have to put the customer at the center of it.” Ridge understands that can be tough for companies still struggling to deal with the disruptions of the last year and a half, but it’s crucial nonetheless.

In discussing how to build a maturity model for thinking about ecosystems, Kuzma outlined a two-step approach that includes looking at how an overall organization integrates ecosystems into their DNA while also looking at individual relationships with leaders.

Hengeveld added his views on how to recognize true success with ecosystems.

“The final stage is when companies have a change of mindset and they’re no longer thinking about ‘my ecosystem,’” he said. “They think about being part of multiple ecosystems. They think about themselves as a dynamic node in multiple ecosystems, and just as much a provider as a consumer and have their systems completely open for people to use.”

Pogue revealed what he sees as his top priority. “I have to create a platform that is friendly to other technologies that I’m never going to provide,” he said. “I have to be able to understand how to hook into those via APIs and make the technology so ubiquitous that it’s almost secondary.” One of Pogue’s goals is for his clients to take for granted that the technology he provides will work.

Do Your Thing, and Don’t Be Afraid to Fail

The panelists also gave their views on how small companies in an ecosystem can stand out. Pogue advised, “Do your thing better than anyone else. It doesn’t have to be a big thing.” Kuzma noted that that’s what her company had to do as well and suggested, “Focus on your strengths.” Hengeveld added, “Smaller is better.”

Finally, Kuzma concluded with some practical how-tos for ecosystem development. “Don’t be afraid to fail,” she advised. “Fail fast and share the learning.” Hengeveld added: “Don’t try to do it all yourself. There are so many people who can do parts of it with you.”

And in dealing with partnering skeptics, Pogue said this: “If you can do it without a partner, fine. But chances are by collaborating, you can deliver a better solution and a better outcome.”

Early adopters of ecosystems have already seen the benefits this strategy provides.