It’s unfortunately all too common for software companies to think of themselves primarily in terms of how good their code is compared to all others, of how disruptive their product is in the marketplace. While quality and innovation in a technology product is unquestionably of value, it isn’t sustainable as a competitive advantage. Technology is too easily duplicated, and it will be. What is not easily duplicated, and is a sustainable competitive advantage, is the corporate ecosystem — the complex network of individuals and entities which naturally forms around a company/product over time. Properly managed, a healthy corporate ecosystem serves as a significant barrier against competition and churn.
What is a Corporate Ecosystem?
A corporate ecosystem is a complex interdependent network of individuals and organizations that forms around a central company and extends outward.
Salesforce offers an excellent illustration of a corporate ecosystem in action. It begins with the core company, Salesforce, and its principal CRM product. Past that center, there are thousands of independent 3rd party firms offering products and services aligned with Salesforce. These include the makers of other applications and tools usable with Salesforce’s CRM or other products. They also include a myriad of consultants, trainers, integrators, customizers ranging from individual practitioners to international firms with hundreds of employees.
In addition to the formally organized firms, there are uncounted individuals trained and certified in the administration and use of the Salesforce and allied products spread all across the globe.
Salesforce’s annual Dreamforce conference, far larger than those of any other company, is another vital aspect of the corporate ecosystem. The yearly gathering reinforces the connections between the hosts of individuals of all types.
And more: Blogs. Local and online meetings of users and other interested parties. Fans/enthusiasts. Analysts. Influencers of every stripe and flavor. Promoters and detractors both. Most importantly, Salesforce’s corporate ecosystem is a community aware of itself as such.
Corporate Ecosystems At The Beginning
Early stage software companies consist of their employees on one side, and the individuals of prospects, active customers, and inactive/churned customers on the other. The initial priority is to build the sales pipeline and therefore the customer base as quickly as possible. But in that rush, the focus is overwhelmingly on acquiring new logo customers. The relationships at this stage generally will be personal in nature, with the risk that if either departs from their companies, the connection will be lost. Only later, perhaps with the establishment of a Customer Success group, will attention and perhaps data gathering begin to be paid to the connections between the company and its employees and the individuals at the customer end.
Over time, declared relationships will start with consultants and producers of related software accessories. Some will be formal and involve specific agreements as to roles and functions. Others may grow up from understandings between the parties, with the connections growing stronger and fading for a variety of reasons.
The Benefits of A Corporate Ecosystem
The workload of software company departments such as Customer Support and Onboarding (Implementation/Professional Services) offer the easiest view of one of the more immediate potential benefits of partnering with the 3rd parties of an ecosystem. No company can afford to staff for peak periods, the expense of such highly trained personnel is such that having them idled when the demand for their services falls is unsupportable. Having relationships with other providers that can be tapped at need is very effective for covering peak periods. Efficiency in personnel utilization, however, is only the beginning of the potential benefits of a vibrant corporate ecosystem. Beyond companies, there are a great host of individuals, and their powerful volumes of word-of-mouth advertising waiting to be utilized which need to be considered as well.
The implications of the changes in our general culture over the last 25 years are plain to be seen. All around us, corporate logos are proudly blazoned across t-shirts, jackets, bags, bumper stickers and everything else across the full range of visible possessions in daily life. We’ve become a society which increasingly is about personal definition through membership in groups and other affiliations. In the face of that reality, it’s time to fundamentally revise how companies think about the marketplace and their own organizational structure. The old Marketing & Sales paradigm and focus on the procession from Suspect to Prospect to Customer, while still necessary, is too narrow. Ignoring the ecosystem that lies beyond the typical customer journey is an unfortunate decision that inevitably leaves very significant amounts of revenue and profit untapped.
Creating a Corporate Ecosystem
The vital first step in the process of creating a corporate ecosystem is the alignment with the company’s overall strategic goals. What income conduits will you always want to own exclusively, and which might be shared? To what degree? What adjacent areas of the product have you marked for your own later expansion, and which might you be willing to cede to allied software firms? Such things need to be clear as possible from the beginning, because changes later — such as suddenly deciding that you’re going to write your own accessory app when there are already others being offered by allies — can cause serious damage to the relationships within the ecosystem. How will you measure the success of your company’s ecosystem? What are the economic goals? How will partners profit from the agreement?
With the strategic aspects defined, the next step is to lay out the implementation plan, and to prioritize the component relationships. Which companies and individuals are to be approached first? What are the expected outcomes? How will you measure success? Who in your organization will be responsible for ecosystem management?
From Possibility to a Profitable Resource
While many companies have designed and developed their own ecosystem initiatives, trial and error can be a lengthy process. If you’re ready to seriously explore the potential of a corporate ecosystem built around your company/product, we’re here to assist.