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- Adopt processes and systems for real-time insights into the supply chain: Sharing data with outside partners increases the potential for risk. Prior EY research showed that cybersecurity is the top concern related to pursuing ecosystem models. It may be difficult to accurately analyze the full nature of the security protocols and guardrails partners have implemented. As a result, it should come as no surprise that business leaders view cybersecurity as the most important area for risk mitigation (45%), followed closely by supply chain execution and logistics (36%) and product or service quality issues (29%).
Steps to take now
Companies that want to improve their ecosystem use cases, partnerships, business models and infrastructure can take the following actions:
- Reframe how you think about partnering: Think beyond the projects or transactions you may have classified as partnerships in the past to the expanded role that ecosystems play in the business. Establishing partner ecosystems requires a cultural shift to embrace collaboration and co-development with internal and external partners. The switch may require implementing a formal change management program to make it happen. “A foundational element of building a high-performance ecosystem is assessing partnerships not as a zero-sum game, with winners and losers, but as mutually beneficial relationships that create value for both partners and clients alike,” says IBM’s Kate Woolley.
- Build a purposeful ecosystem function: An ecosystem office leads sourcing and operationalizing the ecosystem partnership, initiatives and processes. Companies with a high-performing ecosystem are 1.6 times more likely to have a capability dedicated to it and capture 1.5 times more value as a result. They’re also more likely to meet their objectives if they have a leader such as a Chief Partner Officer who is responsible for cultivating and managing the partner ecosystem. “You wouldn’t set up a finance function without a CFO. Why would you set up a partnering function without bringing in function people to set it up?” says Asher Mathew, CEO & Co-Founder, Partnership Leaders.
- Build a common technology infrastructure: Create an infrastructure strategy with protocols that all participants can adopt to facilitate exchanging data. If possible, manage up to the most sophisticated partners’ standard. Include a security plan that accounts for the additional threats associated with working with multiple outside companies. Decide which portions of the infrastructure to locate in the public or private cloud. Not thinking about these matters and choosing the appropriate set up for the situation in advance impedes the speed and effectiveness at which the ecosystem can operate.
- Have a long-term plan: Create a maturity model outlining your partner ecosystem goals. Draw up a five-year roadmap that shows the innovation and investment you need to achieve them.
- Measure results: Tracking your progress can create trust and transparency with ecosystem partners. Choose the metrics that determine if the business model is reaching its intended goals, including monitoring to see if you’re realizing the expected return on your capital investments and operating capital.
Michael Wheelock, West Coghlan and Bhavnik Mittal contributed to this article.