Martin Reeves, Arthur Boulenger, Adam Job

Organizations tend to neglect or downplay the ingenuity component in change initiatives. Leaders often prefer instead a simpler, mechanistic view of the world, which assumes they can easily specify and control actions using project management techniques. Moreover, organizations are often averse to change. Ideas like “breaking the rules” or “reinventing the organization” are less accepted in typical projects—and a departure from the norm will often … [ Read more ]

Ulrich Pidun, Martin Reeves, Maximilian Schüssler

A business ecosystem is a dynamic group of largely independent economic players that create products or services that together constitute a coherent solution.

This definition implies that each ecosystem can be characterized by a specific value proposition (the desired solution) and by a clearly defined, albeit changing, group of actors with different roles (such as producer, supplier, orchestrator, complementor). The definition excludes some of the more … [ Read more ]

How Change Aversion Can Derail a Transformation

Achieving change is difficult. Organizations spend more than $10 billion annually on change transformations, but more than 50% of efforts fail to meet objectives. To better understand why, despite our best intentions, change efforts tend to fail, we looked to the literature—and found that “loss aversion” presents a helpful point of reference.

To better understand this phenomenon, we surveyed more than 200 people across the US … [ Read more ]

Familiar Yet Fatal: 10 Common Pathologies of Failed Change Efforts

75% percent of ambitious change programs fail to capture long-term value. Despite these grim odds, globally, organizations spend $10 B annually on change management efforts. That is understandable in some ways — in our evolve-or-perish environment, organizations cannot afford to stay still. But more fundamentally, it suggests that organizations need to rethink the “tried and tested” approaches to change management. Our research suggests that change … [ Read more ]

6 Factors Driving Changes to Today’s Corporate Strategies

Strategy is a competitive game, which always evolves in response to competition. But the magnitude of the changes in the technological, social, and natural environment are such that corporate strategy will need to be qualitatively reinvented again for new circumstances. This article discusses six factors are driving these changes: 1) dynamism, 2) uncertainty, 3) contingency, 4) connectedness, 5) contextuality, and 6) cognition.

What Is Your Business Ecosystem Strategy?

Drawing on the insights gleaned from three years of ecosystem research, BCG offers a step-by-step framework for developing an incumbent company’s ecosystem strategy.

Martin Reeves, Jack Fuller

Companies often focus on executing one business model, and its associated targets and metrics become the main ways of judging success. But the dominance of such metrics can come at the expense of seeing possibilities and dabbling with new models. When there is a standard, clear way to measure and reward success, efforts in any other direction can look like failures or a waste of … [ Read more ]

Martin Reeves, Jack Fuller

Three types of surprise inspire imagination: anomalies (aspects in our information flow that are out of the ordinary); analogies (similarities we notice between concepts or experiences, which lead us to imagine new possibilities); and accidents (unexpected actions and consequences that draw our attention to something interesting).

Martin Reeves, Kevin Whitaker

Map and understand the larger system in which you operate. Businesses operate within larger economic, social, and environmental systems, which have feedback loops in both directions — businesses’ actions affect the larger systems, and vice versa. Though predicting the exact behavior of such systems is rarely feasible, leaders can improve their understanding by explicitly mapping out the most impactful forces (accelerators or inhibitors of the system’s workings) … [ Read more ]

Martin Reeves, Kevin Whitaker

Business strategy has traditionally considered only a narrow set of issues (such as customer needs, operating model effectiveness, and competitive advantage), a limited range of timescales (most notably the annual planning process), and a limited number of stakeholders (customers, employees, and competitors). Such simplification may have made sense when contextual change was slow, and when the only expectation of businesses was that they would aim … [ Read more ]

How Do You Succeed as a Business Ecosystem Contributor?

Business ecosystems are on the rise. In 2000, just three among the S&P top 100 global companies relied predominantly on ecosystem business models. In 2020 this number had grown to 22 companies, which together accounted for 40% of total market capitalization.

It is no wonder that many leaders of established companies are afraid of missing out on this trend and feel compelled to come up with … [ Read more ]

How Do You Manage a Business Ecosystem?

It is widely acknowledged that business ecosystems offer great potential. Compared to more traditionally organized businesses, such as vertically integrated companies or hierarchical supply chains, business ecosystems are praised for their ability to foster innovation, scale quickly, and adapt to changing environments.

However, many companies that try to build their own ecosystems struggle to realize this potential. Our research has shown that less than 15% of … [ Read more ]

How Do You “Design” a Business Ecosystem?

If designing a traditional business model is like planning and building a house, designing an ecosystem is more like developing a whole residential district: more complex, more players to coordinate, more layers of interaction and unintended emergent outcomes.

What makes ecosystem design distinctive is that it requires a true system perspective. It is not sufficient to design the value creation and delivery model; the design must … [ Read more ]

David Young, Martin Reeves

New business insights can come from changing perspectives on the company’s boundaries, resources, and time horizons. We suggest laying out the whole of the supply chain, the cradle to grave of the product life cycle, the adjacent business ecosystem, and all relevant stakeholders. Take a systems perspective to see the full ecosystem and market dynamics at work. Within this expanded business context, understand where issues … [ Read more ]

Do You Need a Business Ecosystem?

The term “business ecosystem” has firmly established itself in the dictionary of management buzzwords. Many managers, fearful of missing out on this trend, feel compelled to come up with their own business ecosystems—or at least to become part of some large emerging ecosystems. But they struggle with the broad scope of the concept, unclear definitions, and the lack of practical advice. This article should help. … [ Read more ]

Strategies of Change

Instead of defaulting to the standard change management methods, leaders should adopt strategies of change that respond appropriately to the specific characteristics of their change context.

Competing on Imagination

As business environments become more changeable and long-term growth rates decline, companies increasingly need to innovate—across their operations, offerings, and business models. We know the powerful effects of innovation, but what is upstream of innovation? How can we understand and shape the murky mental territory that leads to good ideas: the realm of imagination?

The Secrets of Sustainability Front-Runners

Every enterprise is finding that its space for business as usual is increasingly constrained by the planet’s environmental limits, by broader social and economic needs, and by rising stakeholder demands. Consequently, in addition to addressing all the traditional factors defining competition, company strategies now need to explicitly confront the dynamic socio-environmental externalities of the business. From their impacts on climate to the communities where they … [ Read more ]

The Quest for Sustainable Business Model Innovation

We have argued that corporations should Optimize for Both Social and Business Value, using their core businesses to deliver the financial returns expected by their owners and, in tandem, to help society meet its most significant challenges. To do so, we suggest that leaders reimagine corporate strategy by creating new modes of differentiation, embedding societal value into products and services, reimagining business models for sustainability, … [ Read more ]

Martin Reeves, Kevin Whitaker

In the current model of corporate capitalism, each company is treated as an economic island to be optimized individually. While this simplifies management and accountability, it masks the extent of economic and social interdependence between different stakeholders. In contrast, resilience is a property of systems: an individual company’s resilience means little if its supply base, customer base, or the social systems upon which it depends … [ Read more ]