Academic journal article Research-Technology Management

Competing in Ecosystems: An Interview with Marco Iansiti: Marco Iansiti Talks with Jim Euchner about Digital Hubs, the Platforms at the Heart of Them, and How to Compete in Emerging Digital Ecosystems

Academic journal article Research-Technology Management

Competing in Ecosystems: An Interview with Marco Iansiti: Marco Iansiti Talks with Jim Euchner about Digital Hubs, the Platforms at the Heart of Them, and How to Compete in Emerging Digital Ecosystems

Article excerpt

Marco Iansiti studies ecosystem strategy at the Harvard Business School. In this interview, he discusses the rising power of digital hubs and describes why they emerge, and what makes the ecosystems surrounding them sustainable. He helps to clarify winning strategies for both hubs and the niche players that are part of their ecosystems and explains why some industries are more susceptible to digital concentration than others. lansiti takes note of the power over people's lives that has become concentrated in a few companies and suggests that leaders of these digital businesses have heightened ethical responsibilities corresponding to the power they have aggregated.

JIM EUCHNER [JE]: You have focused a lot of your research on business ecosystems and the role of platforms in competing in the digital age. I'd like to ask you to start by introducing the concept of business ecosystems and why they require different thinking about competitors and partners.

MARCO IANSITI [MI]: Over the last couple of decades we have seen something pretty remarkable unfold in our economy. When we started this digital journey in the 1980s and 1990s, we were looking at computer technology as an enabler of all sorts of things, but a small segment of the economy that focused on computing. What we have seen in the last few decades is how software technology has spread everywhere, so that it's now somewhat difficult to think of human tasks that don't in some way or shape involve software as an enabler.

One of the very fundamental things about digital technology is that it's very easy to connect one piece of digital technology to another, so along with the evolution of the economy toward more and more software, the economy has become much more connected in a massive network of different kinds of things. The networks started back in the 1980s and 1990s with local area networks, but have expanded since to cover almost all aspects of our economy: device-to-device communication, person-to-person communication, thing-to-thing connectivity.

Our economy has become a giant network of different things, all of which can influence one another. This has had a major impact on the structure of the economy, in the sense that it's now hard to really define different industries. Who is in the software industry? Who is in the agriculture industry? I did a project recently working with Intel, for example, on a strategy for agriculture. Who would have ever thought that Intel was in that industry or was interested in driving things in that space? The point is that the economy has become a giant network.

One of the great analogies for understanding this closely connected network of people and things is to think about it like a biological ecosystem. That's where the ecosystem analogy is useful; in economic as well as biologic systems, you want to have an ecosystem that's sustainable, something that works well in the long term, something that can scale.

You notice patterns in biological systems that are healthy and sustaining themselves and others that are not; similarly you can see ensembles of companies and people that are, in some cases, working really well together and in other cases, they're not. Some supplier networks are very healthy and strong and growing. Some supplier networks become very problematic, with people going out of business left and right and so on. The ecosystem analogy, I think, is a good one for business in the digital age.

As an example, one of the fundamental characteristics of networks is that, over time, they develop hubs. This is a property of networks that is very fundamental. In biology, any time you have a network of different living things, and it goes through an evolutionary process, hubs will emerge; some pieces will become more connected than others.

Our economy, as it has become more and more networked, has evolved in the same fashion: we have a small number of organizations that have most of the connections. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.