In the beginning there was the Supply Chain
In the early 2000’s I had the good fortune to create the initial business capability release strategy for E2Open.com, the world’s largest web-enabled supply chain (https://en.wikipedia.org/wiki/E2open))
At the height of the Internet boom, a company could be the darlings of Wall Street one day, and non-existent the next. For the traditional players in the telecom space, this created untold opportunities on the internet as everyone scrambled for the infamous first-mover advantage as consumers began to discover its many possibilities. The seeds of today’s inter-connected world were beginning to take shape.
At the time I was working for the now-defunct Nortel Networks in the Global Supply Management group. Nortel, like all telecom companies, had a supply chain that ran hundreds of suppliers deep and overlapped with other telecoms’ supply chains. It ranged from the IBMs to small mom-and-pop shops. Relatively new organizations to the telecom space such as Cisco were creating waves by bringing newer products to market faster with fewer supply chain partners.
How well you managed your supply chain was just as important as the products it helped you bring to market.
Seven firms contributed $10M US each to create a new consortium, E2Open, to address this problem for the existing industry players.
When another fellow and I from Nortel were tagged to go figure out how to do that, we had no idea how it could be done. My job was to visit all the firms that had anted up their $10M as well as many Nortel manufacturing facilities in NA and Europe to determine how it might be rolled out. When asked what we needed to do this by the EVP, our response was:
- Your help when we need it
- About three months to figure it out
- Don’t ask us for the typical status updates, as we will probably have to lie to you as we won’t have the answers!
What quickly came into focus as the visits piled up for me was that they were all different sizes, all had different existing technologies and processes in place for supply management (even within Nortel), and each was at varying levels of maturity in their methods. As this was unfolding, other decisions were being made within the consortium – the software platform was chosen, and IBM was selected as the hosting provider.
Based on these contexts and other insights, I decided that the traditional approach of rolling out a massive software release across multiple members of the supply chain, especially one that would require numerous business-side changes, was not a very good idea. Instead I suggested a business capability release strategy premised on an incremental and iterative approach that would see a gradual build-out of the required changes at a rate the supply chain partners could reasonably absorb. Our initial focus was on passing basic transactional information – demand, orders, and shipping information.
The results speak for themselves – not only did it launch successfully but E2Open is still around and have expanded their solution beyond telecom to high tech, pharmaceuticals, aerospace and defence, oil and gas, and so on. At last count, over forty-one thousand (41,000+) trading partners use the platform.
Oh, and when the EVP convened his team for us to share what we were proposing they do, he introduced us by saying what he had asked us to do and the fact we basically told home to f-off and leave us alone while we figured it out. He concluded by saying it was the first time anyone had the guts to say that to him, and it was the best piece of advice he ever took!
I’m not suggesting you tell your top executives that, however, I am suggesting they need to understand the degree of commitment such an engagement requires of them in this process and the message that will send to the rest of their organization and their ecosystem partners.
The Emergence of Ecosystems
Since those heady days, the notion of the supply chain has evolved to be the more inclusive and expansive ecosystem model. Supply chain partners are those that sit behind you to create your products and services. Ecosystem models consider not just the supply-side, but also the products and service delivery side, as well as those for whom you may also be a supplier, and your clients/customers. And it’s about a lot more than exchanging transaction data on the movement of goods in a supply chain.
In my first article I wrote that context matters. One of the many reasons why it matters is because almost every organization now belongs to an ecosystem. This means we need to not only create shared context within our own organization about which we want to do something different, we must also build a shared context with our clients/customers, suppliers, service providers, regulators, financial backers, and so on, as all belong to our ecosystem and we to theirs.
In this intricate network of relationships, it becomes crucial that each understands their role within the ecosystem as well as what the other ecosystem partners do that they care about. Each partner must both receive and contribute something of value with at least one of the other ecosystem partners to make it work.
It’s the exchange of perceived value beyond just the money or goods that makes ecosystems different from supply chains
As with ecosystems in the natural world, balance, in this case in the form of value exchanges between partners, will determine ecosystem longevity. And, just like in the natural world, ecosystems will evolve over time, new ones will be created, and existing ones may die off.
Knowing who is in, or needs to be in your ecosystems, why they matter to you, and why you matter to them, requires you to have a deep understanding of both your own context and theirs, as well as they of yours.
Co-creating an ecosystem map is how you and your partners uncover these valuable insights. Visualizing both your current ecosystem(s) and the one(s) you think you will need in the future are the first step.
You can do this by answering these basic questions, among others:
- Who are the participants?
- What impacts and outcomes matter to them?
- How do we interact with each partner in our ecosystem?
- How sophisticated are our and their ecosystem capabilities?
Engaging ecosystem partners to validate your understanding of what they do for you and you for them further evolves collective shared context and shared purpose.
Without ecosystem mapping and the value exchanges they describe we cannot fully create shared context
An off-shoot of co-creating and evolving your ecosystem map with partners is that you also gain insights into ecosystems adjacent to yours; the ones to which your partners belong. Insights shared from these neighbouring ecosystem partners can prove invaluable, as my partner and I discovered with a recent client.
Ecosystem thinking recognizes that we live and work in an interconnected and networked world. That world is represented in the Ecosystems we belong to, which are essentially a network-of-networks.
Shared context and purpose are the building blocks for being able to purpose-define what must be done, by whom, when, where and how to achieve strategic intent.
Ecosystem mapping creates access to a fertile landscape of ideas and possibilities.
Ecosystems and their participants also significantly enhance your organizations access to innovation opportunities
Visualizing your ecosystems is the first step to being able to adapt to their dynamic and emergent nature.