The Business Ecosystem – from ‘separatedness’ to ‘interconnectedness’
All organisations operate within a community – an environment of interconnections. The age-old adage ‘no man is an island’ is the same for an organisation. In fact, just like an ecosystem in nature, the more diverse the relationships and resources an organisation makes use of, the more resilient it becomes. Life is all about continous communication and interaction with its environment. This is what drives adaptation for the most successful organisms – ditto for business.
The organisation is, in effect, surrounded by a semi-permeable membrane that provides a porous boundary between the internal organisation (where the internal stakeholders and resources reside, those directly employed or ‘owned’ by the organisation’s legal entity) and the outside organisation’s business environment of external stakeholders and resources that inter-relate with the organisation as separate entities.
The ‘business ecosystem’ consists of all the resources and relationships interconnected with the organisation’s mission and value creation potential. In turn, the organisation’s business model must also accommodate and recognise the interconnectedness of relationships and resources throughout this business ecosystem.
In these days of globalisation and digitisation, this semi-permeable organisational boundary is not limited by geography. While the organisation has physical sites and discrete markets it may operate in, its internal stakeholders can work for the organisation (within its organisational boundary) while located anywhere around the globe. In fact, it is normal these days for an employee, while on holiday or over a weekend, to dip into the organisational boundary to check emails, dial in to a conference call, take part in a WebEx meeting or meet someone (prearranged or by accident) where the conversation relates to the goals and purpose of the organisation that person works for. In fact, these days, it is less about working for an organisation and more about working with an organisation – contributing to the success of its value creation potential and, in so doing, also contributing to the success of the individual’s value creation potential.
Business missions like ‘to maximise shareholder returns’ or ‘to be number one in our market’ are simply not deep enough to galvanise hearts and minds of employees and the wider stakeholder community. Hence, the organisation’s mission must clarify the value it provides to its stakeholder community – its higher purpose and sense of being (beyond profit).
As Norman Wolfe (author of The Living Organisation) rightly says
‘to function at the speed of today’s business environment, the corporate body must operate in a semi-autonomous fashion, much like the human body…the organisations that know their capabilities and their place within the total ecosystem will, like all living beings, outperform those that don’t’
More and more, organisations attract and retain employees that fit their culture and objectives. The more organisations transform to firms of the future, the more the internal stakeholder’s value creation potential (however diverse) aligns with the organisation’s value creation potential – this is good business sense. Organisations and individuals (leaders and employees) that begin to walk-the-talk of truly sustainable business by believing in the holistic values and mission of the organisation shall be those organisations around at the end of this decade. This requires a step beyond seeing sustainability as a business opportunity which can create value or assist efficiencies to realising it is the only appropriate way to do good business, and so becoming intrinsic to business behaviour.
This is about encouraging business activity which creates conditions conducive to life and no longer tolerating activity which is knowingly toxic to life. Unified visions, strong culture, corporate transparency and stakeholder dialogues ensure values-based sustainable business becomes everyday business.
Clearly, this requires a transformation in business mentality, in business models and organisational culture. As this transformation of the organisation occurs, the more this sharing of core values and behaviours spreads to external stakeholders. The more open and responsive the organisation, the more boundaries between internal stakeholders and external stakeholders blur. This blurring of boundaries is encouraged and facilitated through trust, which comes from a mutual understanding of each other’s values and objectives. It is this interconnection of relationships across the organisation’s semi-permeable membrane that provides resilience, adaptation and responsiveness.
A shift in business mind-sets, no less, from ‘seperatedness’ to ‘interconnectedness’ becomes the new way of operating if your organisation is to survive and thrive this decade and beyond.
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