To paraphrase a well-known African proverb, "it takes a village to raise a child", it also takes a village (ecosystem) to grow an organization. James Moore, a business strategist, wrote an article in 1993, "Predators and Prey: A New Ecology of Competition", and within the article, he explained that an organization should not be viewed as a single entity but as a member of an ecosystem. Moore defined a business ecosystem as the following:
An economic community supported by a foundation of interacting organizations and individuals - the organisms of the business world. The economic community produces goods and services of value to customers, who are themselves members of the ecosystem. The member organisms also include suppliers, lead producers, competitors, and other stakeholders. Over time, they co-evolve their capabilities and roles and tend to align themselves with the directions set by one or more central companies. Those companies holding leadership roles may change over time, but the function of ecosystem leader is valued by the community because it enables members to move toward shared visions to align their investments and find mutually supportive roles.
Let's consider an ecosystem that all of us, as individuals, work within every day without even a thought. Do you remember the first time you moved into a new location (apartment, house, city, neighborhood, etc.) and engaged with your neighbors? You most likely asked them for guidance on good, close-by grocery stores, dentists, doctors, pharmacies, coffee shops, restaurants, etc. The advice you gave was based on their personal experience and preference, as well as from references from their social contacts. This was your first exposure to an ecosystem, whether you realized it or not.
Now, let's consider ecosystems from a business perspective. Look at 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. Additionally, partner programs, offered by companies like Oracle, IBM, Cisco, Salesforce, Microsoft, etc., serve as an ecosystem. For example, if you interact with one of these organizations, they will suggest a partner assist with your questions, sizing, scope, implementation, and support.
Large and small consultancies often operate in an ecosystem, as well. No organization has ALL the expertise needed to solve all client problems or pain points. So, for those areas of expertise that fall outside of the consultancy, they work with "strategic alliances", which is just a fancy name for an agreement that enables them to project expertise through alliance partners. For example, consider a client of an Accounting Services Provider (ASP) asking their ASP the following, "What would be the financial impact of upgrading our infrastructure?" The ASP says to the client, "Let me get back to you. I need to discuss with folks with more expertise in this area."
The ASP isn't skilled in the manufacturing infrastructure. They know little about the network they use at their home office and can only truly define their network infrastructure based on the laptops and desktops they see being used in the office and the office calls received on their mobile phones. They rely on a tech company to handle all of the "tech stuff". The ASP realizes that their manufacturing client probably has a more complex tech infrastructure, so they call two strategic partners. Both companies provide some ideas and names of folks that they have used and recommended. The ASP says they want to present some options to their client, and the ASP's manufacturing recommendation and the tech company the ASP uses get together to discuss an outline for the ASP client.
This is an example of how an ecosystem is used to address problems. The ASP does not have the expertise to directly answer the question posed, and they don't risk damaging the relationship with the client by guessing. So, they facilitate the gathering of subject matter experts who can help and understand the problems and provide solid options to the client.
The key to using an ecosystem to address your client's needs, goals, or pain points is to understand that your reputation with the client is on the line with those that you bring to the table. They most likely won't be speaking with the client had you not made a recommendation. So, if the results are less than expected, then your reputation with that client is impacted.
You may be wondering what the difference is between the scenario outlined above and simply referring a client to another party. The difference is that when you refer you put the onus back on your client. Additionally, a referral doesn't allow you to vet the party to ensure that they are the best person for the job. You don't put the client first by referring a client to someone else. Think about it this way. Have you ever called an organization, and, after making five selections from five different menus, you finally talk with an actual human who says, "I am sorry. I am not the person that can help you. The [XYZ] department handles these inquiries. Let me transfer you." Before you know it, you are hearing the instrumental version of Barry Manilow again. How did it make you feel to be transferred (referred)? I can imagine that you did not feel important to the organization. The main difference between an ecosystem approach and a referral approach is that an ecosystem enforces client or customer - centricity.
Moreover, when operating in an ecosystem you rely on entities with which you have experience, have seen in action, and can attest to their moral and ethical code of conduct with clients. An ecosystem provides a "go-to" group that you utilize and refer to your clients. The same group will reciprocate the favor since you have established synergy and a symbiotic relationship.
We have both worked in an ecosystem, and we would like to share the benefits we and our clients have experienced from working in an ecosystem.
Joe Romello
In my professional career as a consultant with the largest consulting firms and as a solo consultant, I have relied on personal relationships with capable individuals in various firms to assist my clients. People move around which is why individual relationships are important. Companies are just assemblies of individuals, and you can qualify a company very quickly by speaking with an individual working there that you know and trust.
I have had instances where my contact is at a company and when I reach out, I have been told, don’t bring that work here, I don’t recommend it for reasons I can’t fully describe right now. Remember John that we worked with a few years ago on Project X? His company would be a candidate for the project you are discussing, and I unequivocally recommend him and his company.
In all cases, don’t try to bluff your client – the world is too small, and knowledge is just a keystroke away. Ask for the time to address the problem then contact folks in your ecosystem that you trust and solicit advice. If the project is of interest, they will tell you and, if not, make a recommendation. Remember, anyone you bring to your client is a reflection on you and will impact your reputation with your client. Choose wisely.
Tiffany Joy Greene
Early on in my career, I learned the importance of establishing an ecosystem. There is never a goal, problem, or pain point that a client comes to me with that only requires my expertise. No decision, plan, or tactic operates in a silo.
For example, if I am called upon to help an organization grow revenue for their brand, every area of the organization will be impacted, not just marketing and sales. How will operations handle the uptick in sales volume? How will accounting handle increased A/R and A/P? How will HR handle the new demands on employees? Etc.
As a brand strategist, I believe that I must be asking these questions and have the foresight to understand the consequences of increased growth on the entire organization. However, I am not an engineer, human resources expert, CPA, etc. It is my responsibility to have an ecosystem of trusted experts that I have experience with that I can call upon to help me best serve my clients.
To grow, sustain, and develop an organization takes a variety of resources and support, and the resources and support must work together, not in silos. Resources within an ecosystem must not compete with one each other to vie for the opportunity to say business success was a result of their efforts because true success and outcomes are achieved when an ecosystem moves forward for a common purpose. Organizations that evolve together as a community to best serve clients are a means for each member of the ecosystem to extend beyond the four walls of their business; provide expansive services to their clients; and live up to the phrase "trusted advisor".