As global business leaders become increasingly concerned about disruptions to their current growth strategies, many report that they are seeking to gain a competitive advantage by building ecosystems in which they join forces with other companies to share data, customers, technology, and industry knowledge, a recent study by professional services provider Accenture Strategy has reported.
The findings of the study, “Cornerstone of Future Growth: Ecosystems,” are based on a survey of 1,252 C-level executives at large companies spanning 13 industries and seven countries that was conducted in January 2018. The survey found that only 25% of the business leaders indicated that they are very confident they will achieve their 2020 growth targets, while 56% said they are concerned that current growth strategies are at high risk of disruption. The results also showed that 76% of the executives polled agree that their current business models will be unrecognizable in the next five years, and that ecosystems will be the main change agent.
In the study, an ecosystem is defined as a network of cross-industry players who work together to define, build, and execute market-creating customer and consumer solutions. Researchers estimated that ecosystems enabled by digital platforms could unlock $100 trillion of value for business and society over the next decade, and noted that the companies that are currently in the strongest position to take advantage of the synergies provided by ecosystems are operating in the telecoms, banking, and utilities sectors. Examples of such ecosystems include a furniture retailer partnering with an online job site to connect customers with workers willing to assemble the furniture, or health care providers that partner with rideshare services to transport patients to appointments.
The business leaders surveyed reported that they are seeking to capitalize on the opportunity by forming ecosystems to make major innovation plays (63%), increase revenue growth (58%), access new markets (55%), and attract new customers (55%). The results showed that 60% of respondents are looking to build ecosystems to disrupt their industry, 46% are actively seeking partners, and another 77% believe their company will generate more than half of its revenues from ecosystems in the next five years.
The study also pointed out, however, that many executives lack the experience and capabilities needed to design and execute market-leading ecosystems, and thus are not realizing the revenue growth they had predicted from ecosystem participation. The survey found that 58% of respondents targeted a growth rate of 3-4% from ecosystems, but only 40% are achieving it; and that just 12% are seeing growth of 5% or more from ecosystems.
Moreover, while half of executives surveyed said they are using platforms to share data and/or information across businesses, more than one-third admitted they are concerned about sharing intellectual property data (34%) and about cybersecurity (35%). In addition, while nearly two-thirds (63%) of respondents agreed that the technology/platform is the most important thing to get right in an ecosystem, nearly half (44%) acknowledged that they are worried about sharing company assets and secrets.
Nonetheless, large shares of the executives surveyed anticipate that ecosystems will have an impact on their business over the next three to five years: 56% of respondents said they believe ecosystems will create a new competitive advantage, 50% predicted that ecosystems will allow them to use data and analytics to better serve customers, 46% said they believe ecosystems will create new customer experiences, and 44% expressed confidence that ecosystems will drive innovation and disruption over this time period.
From Benefit Trends Newsletter, Volume 61, Issue 8
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