Chp 4: Impact of the ecosystem on organisations and strategy

Question 1

What are the three main characteristics of Globalisation?

Answer 1

1. Mulitnational/multi-company supply chains
2. Offshoring work
3. Increasing mobility

Question 2

What are the destruction and capitalisation effects of automation?

Answer 2

• Destruction: technology forces workers to become unemployed or reallocate their skills elsewhere
• Capitalisation: Follows the destruction effect, in which demand for new goods and services increases, leading to new occupations, businesses and industries

Question 3

What are two important benefits from ecosystems?

Answer 3

1. Improved access and lower cost of skills
2. Using the ecosystem to expand the scope of strategic business opportunities and initiatives

Question 4

What are the four main ecosystem roles?

Answer 4

1. Experience providers - provide specialist competencies in unique functions
2. Asset providers - provide or manage assets used in production
3. Process providers - manage processes and SLAs across shared activites to increase seamlessness
4. Platform providers - provide the environment that supports the ecosystem and enables it to operate

Question 5

What is the direct network effect?

Answer 5

That the value of a product/service to a user increases exponentially with the number of users also using the same product/service

Question 6

What is the indirect network effect?

Answer 6

The value of a network increaes with the complementary products or services added to it

Question 7

Participants in an ecosystem can be defined by which three components?

Answer 7

1. Role played in the environment
2. Reach through the environment
3. Capability or contribution to the environment

Question 8

What three components can be referenced when defining interactions in an ecosystem?

Answer 8

1. Rules governing the environment - principles
2. Connections of elements - linkages across the environment
3. Course of interactions - speed and direction content is shared

Question 9

How do the four ecosystem types (based on complexity and orchestration) change an organisations strategy for value creation?

Answer 9

1. Shark Tank (LC, LO) - Need to differentiate from competitors
2. Wolf Pack (LC, HO) - Build diferentiators and build strong relationships with orchestrators
3. Hornet’s Nest (HC, LO) - Must find their own ways of value creation, will lead to fragmented competition
4. Lion’s Pride (HC, HO) - Align strategic objectives with the orchestrator. Avoid disintermediation by differentiating

Question 10

What are the six key principles for building trust-based platforms?

Answer 10

1. Security - cyber-security measures
2. Accountability - platform must be reliable, participants comply with standards and operators held responsible
3. Transparency
4. Auditability - externally
5. Fairness - in value allocation. Regulators would play a key role in this
6. Ethics