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What Does a Successful Digital Ecosystem Look Like?
Article

What Does a Successful Digital Ecosystem Look Like?

Michael G. Jacobides, Nikolaus Lang, Nanne Louw and Konrad von Szczepanski
Boston Consulting Group, 2019
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8

Qualities

  • Analytical
  • Overview
  • Concrete Examples

Recommendation

Digital ecosystems represent more than a fad. Complex, powerful and boundary-breaking, they’re facilitating rapid innovation and forcing companies to re-envision themselves. Given the speed and complexity of their development, digital ecosystems are also challenging executives and analysts to understand the inherent dynamics. For this concise but insightful article, researchers at the Boston Consulting Group studied 44 ecosystems across 12 sectors to discover the factors that correlate with success.

Summary

Moving first into digital ecosystems doesn't ensure long-term dominance.

A study of 44 digital ecosystems across 12 sectors reveals that five factors correlate with success – defined in terms of financial benefits to the ecosystem’s orchestrator, innovation, and total user numbers and growth. The five factors are: 1) a smart strategy and the ability to draw in necessary partners, 2) a pre-existing user base, 3) a large quantity of partners, 4) a broad geographic span among partners, and 5) the ability to facilitate a variety of deal types. The digital ecosystem surrounding Amazon’s Alexa illustrates the combination of those five factors: Despite being the market leader, Amazon moved into the space third. Its ecosystem includes at least 38 partners in 11 countries, and it...

About the Authors

Michael G. Jacobides is the Sir Donald Gordon Professor of Entrepreneurship and Innovation and a strategy professor at London Business School. Nikolaus Lang is a managing director and senior partner at Boston Consulting Group, where Nanne Louw is a principal and Konrad von Szczepanski is a managing director and partner.

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