Why ecosystems matter for your business?

McKinsey's latest report on the power of eco-systems is truly amazing. It builds on the concept of capitalizing human relationships and social need to belong, and use that to empower our businesses. Checkout this Concis info-presentation to learn more.

Transcript

1. • Reduces friction when switching between related services by enabling access to multiple functionalities via a single platform • Increases the appeal of goods or services as more users adopt the solution • Creating value-added products and services using data, ultimately leading towards superior experiences What is an ecosystem? Characteristics of an ecosystem Gateway to products and services Network effects Data integration
2. Acquisition Engine Multi-business ownership Asset or resource synergy Infrastructure and capability enabler Platform Data monetization Selecting an ecosystem business model The 6 types of ecosystem and their impact the top line the bottom line
3. Industry use case: • Banks • Internet companies • Other ecosystem players Multi-business Ownership Ecosystem – Type 1 Build new businesses outside the traditional scope of the company Meituan built a diversified business to provide a one-stop shop with a range of services for its users
4. Capture new customers and ultimately maximize core revenues. Requires deep knowledge of customer management Industry use case: • Internet companies • Other ecosystem players To attract new customers, ‘Ping An Good Doctor’ began the ‘daily walk’ plan to encourage healthy activity Acquisition Engine Ecosystem – Type 2
5. Industry use case: • Banks • Internet companies • Other ecosystem players LY.com increased revenue by cooperating with WeChat to broaden channels for reaching customers and offering a rail and flight booking service Platform Ecosystem – Type 3 Develop digital platforms that enable third parties to offer products and services or participate as providers
6. Industry use case: • Internet companies Data Monetization Use data collected to develop new data- led businesses Alibaba launched ‘business advice’ to offer operational counsel to merchants who buy a subscription Ecosystem – Type 4
7. Combine existing assets and resources to achieve operational efficiencies Industry use case: • Banks Asset or Resource Synergy Alibaba set up two middle offices to provide data analytics and customer management coordination Ecosystem – Type 5
8. Monetize existing infrastructural, technology, and other capabilities to decrease investment costs per unit Industry use case: • Banks Infrastructure & Capability Enabler Meituan extended its cloud computing service to other players, which helped decrease investment and maintenance costs per unit Ecosystem – Type 6
9. How to pick the right business model External assessment Look out for the size of the industry, and the prevalence of network economy characteristics – value added to products and services through large-scale, global social networks Market Size Determine the potential for expansion, including new customer prospects and overall revenue growth Growth potential Map out the interest and adoption of ecosystems by competitors worldwide Competitive strategy
10. How to pick the right business model Internal assessment Data Accessibility Identify the relevance of an ecosystem model to the consumer base, core business model, and corporate capabilities Overall Relevance Evaluate existing partnerships to assess whether they can be leveraged for resources and network opportunities to bolster potential ecosystem development Existing Partnerships Determine whether enough information on customers is available to build a detailed plan-of-action for ecosystem development
11. Case Study – Commonwealth Bank of Australia (CBA) Ecosystem assessment for CBAs ‘house-buying app’ External assessment Internal assessment • Steady growth rate • Valued at roughly $5.6 trillion Market Size • Influx of over one million immigrants since 2011 • Housing prices relatively stable Growth Potential • Access to huge database of existing customer data Data Accessibility • Ongoing collaborations with multiple companies Existing Partnerships