What characterizes a digital ecosystems

There is a lot of discussion and hype about digital ecosystems today. Digital ecosystems are stepping up to solve the problems of the platform economy. But ecosystems are not a new phenomenon. They have existed since the economy as a whole has existed. So where is the increasing attention on digital ecosystems coming from today?

In the classical sense, business ecosystems are various companies interacting with each other to create value together. The jointly created value must be more valuable to each of them than what they are capable of creating on their own. Such interactions usually take place locally in traditional business ecosystems, for example within an industrial park or an innovation zone. In the digital world, both the range of business partners involved and the scope of cooperative business models can now be significantly expanded. The speed with which new business partners can be found, business relationships initiated and value exchanged has also increased dramatically through digital technologies.

Of course, digital ecosystems only work with digital tools. And therein resides one of the core challenges of digital ecosystems.

• How can business partners and available resources be found quickly?
• How can data be shared and validated with trust?
• How can transmitted data be processed automatically to actually gain efficiency?

In order to work efficiently in a digital ecosystem, questions like these must be answered and the necessary tools must be available to all participants in the ecosystem in the same way. These questions may seem simple, but in reality they are often major hurdles due to the need for consensus among all actors. This fact gives further push to the platform economy. Instead of the traditional ecosystem, in which companies interact with each other on an equal level, there are platforms that digitally map the necessary interaction and thus standardise and automate it.

The fact that ecosystems have always existed raises the question of why it is so difficult to digitise them. Therefore, the most important characteristics of an ecosystem will be used here to show how the digital transformation can be approached.

Many actors

Whereas a traditional business model has a linear relationship between a company and its customers, the relationships in an ecosystem are complex. Here, different actors act and create value together. Each actor acts collectively in its own interest. Within an ecosystem, each actor can have different roles. Each role, in turn, can be linked to one or more business models. Roles in a digital ecosystem are

• Solution Provider create value in an ecosystem. These can be digital or physical services that are needed and used in the ecosystem. If you want to digitize an ecosystem, the solution providers are the path to the consumer.
• Consumer use services in an ecosystem. Usually, consumers obtain services from different solution providers. By using common resources (e.g. a digital currency), values can be consumed and transferred in a similar way. Consumers can be individuals or organisations.Consumers are the most important and often underestimated role in digital transformation. If digital services are to be created, the ecosystem and the services must always be viewed from the consumer’s perspective. This is the only way to find and consistently describe the values to be exchanged in the ecosystem.
• Service Partner provide shared resources to all actors in an ecosystem. These can also be digital or physical resources that are used and accepted by all actors. An example of such resources are digital currencies provided by a bank and used by solution providers and consumers in the ecosystem.
• Finally, the digital transformation of the ecosystem also needs an Initiator. This initiator provides the impetus for the transformation and establishes the basic rules for cooperation in the digital ecosystem. The initiator can be a single actor or a group of initiators. It is not a case of the initiator having sole ownership and control. The initiator is usually an actor in one of the other ecosystem roles among all other actors.

Shared Purpose

Every ecosystem exists because of a common interest or need among the participants. This shared purpose defines the ecosystem. It can either be a content-related matter (same interests) or a regional matter (same location). In every ecosystem, shared purpose can be found to a greater or lesser extent. Whereas some shared purpose affect all actors in an ecosystem, others only apply to individual groups of actors. This has implications for the digitisation of the ecosystem. Initially, it is important to work out the purpose of the cooperation and align the first steps of the digital transformation with this. This is the only way to ensure participation and the necessary consensus among all (important) actors.

Shared Rules

When many actors come together and want to achieve something together, this is only possible on the basis of a set of rules to which all actors comply. The term governance is often used for this set of rules. In an ecosystem, the most important thing is that these rules are defined in such a way that they are transparent and comprehensible for all existing and new actors and that they are not driven by individual interests. Otherwise, it is more of a platform (in the guise of an ecosystem) than an ecosystem.

Shared Resources

Every (digital) ecosystem has resources that are used by all or at least several players. This shared use results in an advantage for all players. Examples of such shared resources can be digital services (such as payment), physical resources (such as machines) or organizations (such as shared suppliers).

Shared Value Creation

Probably the most important aspect in any business relationship is value creation. Whereas in the classic business model, value is created between the provider and the customer (linear value creation), the situation in the ecosystem is more complex. On the one hand, value creation also takes place here between a provider (e.g., solution provider) and its customer (consumer). However, this value creation is based on an exchange of values that is the same for all players. Only in this way can a consumer use offerings from different providers and a provider serves several consumers. If digital ecosystems are to be designed, the exchange of values deserves special attention.

And here you can already see the complexity. Many players in an ecosystem on the one hand, and a lot of shared things to agree on the other. Nevertheless, I think it is worthwhile to take a closer look at the digital transformation of ecosystems. Since ecosystems are part of our everyday lives, their digital transformation is inevitable. If you don’t want to leave the field 100% to the platforms, then you have to overcome these hurdles.