By Michael Roch, CCO at allianceboard
In "Ecosystems and platforms: How insurers can turn vision into reality", McKinsey provides a good blueprint for making ecosystems happen. While the article is focused on the insurance sector, the approach presented also works well for the banking or non-financial services industries.
Three aspects are worth considering when implementing McKinsey's advice.
Instead of dreaming up a big "vision", be clear about how your ecosystem solves your core competitive challenge.
First, we have always struggled with “setting bold visions” as the sole starting point for any strategy. From a practical perspective, equally important is a hard examination of the core competitive challenge that the business seeks to overcome, how creating or joining an ecosystem could help overcome that challenge, and some initial principles of how the ecosystem would need to be constituted. Especially in inherently conservative businesses, this nuance will help derive a strategy that is actually capable of execution.
Available cash drives your ecosystem's ambition.
Second, and on execution, it is easy to talk about technological excellence, modular platforms, APIs, etc. McKinsey is right to showcase the success of an online insurer in this regard. Yet for most legacy insurers, flexibility remains out of reach as they continue struggling with the complexity and age of their legacy IT infrastructure, organizational structures and belief systems. The question is whether their capital base is sufficient to compete against nimble newcomers.
Technology supports your ecosystem operating model.
Third, it is at the "scale and operate" stage where the rubber hits the road. It simply isn't sufficient to review ecosystem plays and grow additional use cases. If a company wants to orchestrate its own ecosystem, it needs to find, staff and resource the right target operating model so it can interact with and nudge along the ecosystem's supply- and demand sides.
The right alliance- and ecosystem-centric technology is critical for successful implementation. For example, allianceboard helps tracking goals and successes across partners, engages partners in decision-making and provides the right analytics to ensure profitable growth of ecosystem outcomes. All partners can access and contribute using allianceboard, providing a consistent view across the alliance portfolio or ecosystem. This helps ecosystem managers align their internal stakeholders and allows for better external alignment across the leadership teams and ecosystem execs of the ecosystem's driving organizations. Integration with internal ERPs and CRMs provides even better data and analytics for rapid decision-making across partner organizations. And, our technology can reduce the headcount required to run the ecosystem once mature.
McKinsey's article is well worth reading. Get in touch with us at contact@allianceboard.com to learn more about how allianceboard can help you manage your ecosystem, platform or alliance portfolio.
About the author: Michael Roch is allianceboard's Chief Commerical Officer. Reach out to Michael at mroch@allianceboard.com.