digital ecosystem essay

Digital Innovation Ecosystems: A Systematic Literature Review and a New Definition

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• First Online: 24 February 2024
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• Irina Gorelova 12 ,
• Francesco Bellini 12 ,
• Adriano Fabbri 12 &
• Fabrizio D’Ascenzo 12  

Part of the book series: Circular Economy and Sustainability ((CES))

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• National Congress of Commodity Science

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The rapid development of digital technologies creates digital ecosystems that penetrate into the everyday lives of society. The digital ecosystem is a relatively new phenomenon and has multiple connotations and dimensions in the scientific literature, but it is univocally recognized as a context of the technological execution of both innovation and business ecosystems. The concept of digital innovation ecosystems (DIE) is only partially debated in the scientific literature, so the main objective of this research is to provide a full-fledged definition of the phenomenon under consideration. To reach this goal, an approach based on a broad systematic literature review (SRL) of scholarly studies is adopted. SRL on the definitions and dimensions of DIEs provides evidence of the nature of this rising trend, allowing an in-depth understanding of the dynamics in this domain. The main results of the research are the aggregation and analysis of the various definitions of DIEs, their systematization, and the formulation of comprehensive and shared DIEs.

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Gorelova, I., Bellini, F., Fabbri, A., D’Ascenzo, F. (2024). Digital Innovation Ecosystems: A Systematic Literature Review and a New Definition. In: Lagioia, G., Paiano, A., Amicarelli, V., Gallucci, T., Ingrao, C. (eds) Innovation, Quality and Sustainability for a Resilient Circular Economy. AISME 2022. Circular Economy and Sustainability. Springer, Cham. https://doi.org/10.1007/978-3-031-28292-8_47

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Digital Ecosystem: Strategies and Principles of Ecosystem

Several organizations may feel that the channels, platforms, and techniques they have relied on for years are burning up quicker than ever as COVID-19 accelerates customers’ migration to digital, with consumers of all ages going online for everything from food to vehicles to doctor appointments.

The epidemic has amplified a prior trend in which many conventional businesses attempted to build or participate in digital ecosystems but failed. Users may fulfill a range of cross-sectoral demands in one integrated experience by using these ecosystems, which are made up of interconnected sets of services. Ascending tech businesses created today’s dominating ecosystems by using hyperscale platforms to compete with, disintermediate, and frequently replace conventional rivals’ services by controlling consumer interfaces and control points like search, advertising, and messaging.

This power is recognized by the market. The majority of the corporations with the greatest market capitalizations in the world are IT companies that get a significant portion of their income from the digital ecosystems they built . Many of these digital ecosystems are business-to-consumer (B2C) ventures. Amazon, for example, combines e-commerce, cloud computing, shipping, and consumer electronics, while China’s Tencent offers social networking, gaming, banking, and cloud computing services.

The goal of this article is to look at how digital ecosystems affect competitive strategy. Digital ecosystems are ecosystems in which digital connection drives interdependencies. They’re the result of several technical factors that combine to create a network of data receivers with whom businesses may exchange data and co-create value. A company must have productsFootnote1 that produce and distribute data within this network of data receivers in order to profit from digital ecosystems.

They will be able to compete not only with products but also with the data that their products create. Digital ecosystems, in general, have an impact on how things are created, marketed, and consumed. These characteristics of digital ecosystems, in contrast to conventional ideas of digital ecosystems, more clearly exhibit repercussions for competitive strategy. The notion of digital ecosystems is developed in this essay, as well as some of its ramifications for competitive strategy.

Parallelism Between Industries and Digital Ecosystem

To grasp what makes digital ecosystems unique and how they could affect competitive strategy, it’s helpful to first recognize certain similarities between the generic construct of ecosystems based on conventional business interdependencies and industries and the digital ecosystems. Interdependencies, which epitomize the current construct of digital ecosystems, are not a new concept for businesses, therefore parallels are to be expected. Indeed, competing in industries demands managing a plethora of interdependencies, which companies have historically done through their value chains.

A manufacturing company, for example, must handle multiple interdependencies throughout its supply chain, production and assembly divisions, R&D, marketing, and distribution and after-sales support networks. In the process of soliciting deposits and selling loans, a service firm such as a bank maintains interdependencies across several branches in a similar way. The exact manner in which companies do so distinguish their competitive positions.

Firms may expand their value chain interdependencies even more by enlisting alliance partners to help with certain aspects of their operations or sales. Firms must also deal with interdependencies with their industry competitors since each of their competitive activities stimulates competitive replies.

These organizations manipulate their value chain operations such as marketing and sales to develop better multi-market interaction, or coordinate other activities such as plant locations, product releases, or pricing in ways that minimize competitive reprisal to dissuade rivalry and sustain profitability. An ecosystem, in this context, is an industry. Its fundamental interdependencies aid our comprehension of competitive strategy. It also serves as a benchmark for evaluating how this knowledge might be improved via the perspective of digital ecosystems.

How To Create an Ecosystem Strategy?

1. identify the ecosystems in which your company must play a part:.

Analyze your present business — what you do, who your partners and customers are, and where the dangers and opportunities are arising. Create visual models to demonstrate how your activities fit within current and future digital ecosystems . These models should identify the stakeholders you’re working with, the value propositions they offer, and the value exchanges of commodities, services, money, credits, information, and intangibles.

2. Determine Which Roles You Should Play in Relevant Ecosystems:

Create ecosystem models, incorporating current ecosystems and where you fit in, as well as ecosystems where you can have a huge impact. Define the value propositions, key interactions, ecosystem players, situations that might hasten change, and roadblocks. A corporation must have or construct, a platform that causes massive network effects to be an ecosystem orchestrator. This necessitates a focus on a key interaction that draws stakeholders to your platform in the first place. The engagement for Uber, for example, was between passengers seeking drivers. Your business can then provide more interactions. Similarly, a corporation can expand and monetize its products as a modular producer without the added hurdles of organizing the interactions of third parties as well. Such monetization might involve developing data services based on market or client knowledge. It has the ability to transform those insights into consumable goods. Furthermore, businesses must build a solid application programming interface strategy so that ecosystem stakeholders may connect to its data automatically via the internet. A corporation, for example, can act as an orchestrator in one ecosystem and as a producer in another.

3. Determine How to Monetize Your Role in The Ecosystem:

Examine your key competencies to see if you have any assets that you haven’t been able to monetize in the past but could now in an ecosystem. Consider how you might be able to add value to such assets. An ecosystem modeling exercise enables a company to describe how it derives value from its engagement.

Principles of Ecosystem

Many businesses utilize common frameworks to select which new income streams to explore while pursuing ecosystem strategies. As a result, they only look at the apparent connections. However, in the ever-evolving world of Ecosystem 2.0, a comprehensive strategy driven by the following three ideas is required:

1. Use Strategic Mapping to Detect Control Points:

A top-down view of the possible breadth of influence, as well as a nuanced strategy meant to nurture diverse activities by the many stakeholders involved in an ecosystem, are the foundations of holistic ecosystem strategies. Whether you’re organizing or participating in an ecosystem, the first step is to map the horizontal and vertical dimensions of the vast ecosystem in which you operate or want to participate against your present firm. The map will highlight “control spots”, or locations on the map where the organization might have the most effect on the value chain by installing or recruiting the proper skills. The map will also show you how far away your company is from these checkpoints. Companies that are getting closer to a control point may want to create an ecosystem around it. If they find themselves further away, they may try to get closer or opt to join ecosystems built by more natural owners of a specific control point. In general, control points are the optimum places to install capabilities to alleviate pain points and streamline the path of customers’ trips. Mastery of one or more of these control points lays the groundwork for horizontal and vertical expansions that may catapult your organization into new markets, new customer and business partner groups, and even new enterprises.

2. Lock-In Impact with Precise Resources:

Mapping is a method of forcing control points to be prioritized. Companies that wish to get benefit from the control points they’ve identified must first build and recruit the necessary competencies. To do so, businesses may need to rethink and modify current capabilities, or they may need to seek out partners who can fill in the gaps. Advanced digital skills such as AI, functional know-how such as digital marketing, high-level supply-chain, and logistics skills, and innovation capabilities to boost the value of products and services are all components that incumbents frequently lack. As previously said, IT firms have made it simpler than ever for incumbents to locate suitable partners to supply digital expertise.

Making the whole greater than the sum of its parts by articulating the right vision for where the market is going, combined with building a platform that lowers investment costs for other companies by lowering interaction costs and boosting learning, helps to make the whole greater than the sum of its parts and promotes distributed innovation. Ecosystems and the organizations that makeup they enhance their reach and influence by locking in impact with suitable capabilities at key control points. Successful firms concentrate on control points with laser-like precision and intentionality in order to align ecosystems exactly with what customers want and expect — and to recruit the partners they need to do so.

3. Design The Organization for Numerous Customers:

Successful ecosystems are built to generate market gains and value for all stakeholders. That is, without a doubt, what investors want to see. Companies that want to orchestrate or participate in ecosystems, on the other hand, must balance a complex set of challenges both within and outside their own walls. Internally, they need to figure out the best organizational structure.

Companies frequently make mistakes in this area by going to extremes. One extreme takes an organizational silo approach, such as handling the whole housing ecosystem through the department or function that deals with mortgages. Capabilities will be insufficient in this paradigm, making scaling problematic. At the opposite end of the spectrum, organizations utilize the venture capital model to acquire firms that they believe are needed, such as technology platform providers, and then fight to integrate the purchase with their existing competencies, go-to-market strategies, and data systems. The best model will be in the center, adjusted to both internal and external circumstances.

Future research might uncover, explore, and examine further implications of digital ecosystems for competitive strategy. One such issue concerns the mechanisms involved in ecological “digitization.” Firms undoubtedly have a role in digitizing value chains and establishing industrial ecosystems. In this case, the procedure entails digitizing existing ecosystems (or value chain interdependencies). Interdependencies exist outside of existing value chains in consumption ecosystems, on the other hand.

These ecosystems develop as a result of “connected” entities and assets that add to the data created as a by-product. An individual company’s involvement in digitization is significantly smaller; rather, it benefits from a growing network of similar businesses formed by greater technical forces. As a result, analyzing the digitalization of consuming ecosystems may necessitate a different strategy than studying the digitization of production ecosystems.

Data, rather than goods, plays a significant role in value generation in digital ecosystems, which has consequences for organizational architecture. Part of the aims of what is commonly referred to as digital transformation are new organizational structures that enable conventional enterprises to compete effectively in digital ecosystems.

Written by The Enterprise World Magazine

The Enterprise World, is a business magazine, a platform for all the master business minds to share their stories of success. https://www.theenterpriseworld.com

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• Digital transformation

digital ecosystem

What is a digital ecosystem?

A digital ecosystem is a group of interconnected information technology resources that can function as a unit. Digital ecosystems are made up of suppliers, customers, trading partners, applications, third-party data service providers and all respective technologies. Interoperability is the key to the ecosystem's success.

Digital ecosystems are frequently created and controlled by market share leaders; the model has its roots in keiretsu and is quickly influencing change in various industries, including consumer products, automotive and healthcare. The integration of business-to-business ( B2B ) practices,  enterprise applications  and  data  within an ecosystem allows an organization to control new and old technologies, build automated processes around them and consistently grow their business.

Unmanaged, organic growth of an ecosystem can be fatal to a business. It's important when building an ecosystem to ensure all dependencies have been identified and can be controlled. Creating a digital ecosystem map is a key to establishing a strong ecosystem. The digital ecosystem map is a visual diagram of all digital tools and platforms used within the organization. It illustrates processes, how data is transferred between parts of the ecosystem and whether the process is automated or manual. To be effective, mapping should also document which systems are not currently connected or able to speak and transfer data between each other, as well as who the users of each system are and who is responsible for maintaining them.

How digital ecosystems work

The technical, legal and business-related difficulties found in digital ecosystems are significant. Service orchestration, delivery and  monetization , as well as customer engagement and data management ( CDM ) across the entire ecosystem, are some of the biggest challenges.

The tools for managing an ecosystem can fall into the following categories:

• Project management tools, such as  Agile software development  tools, task management software and issue tracking systems.
• Research applications, including data storage and visualization , resource libraries and archives.
• Engagement tools, like email marketing, donor management tools and customer relationship management ( CRM ) software.
• Collaboration tools, including email, file sharing, instant messaging and video conferencing.
• Public platforms, such as websites, Mobile apps and social media channels.
• Knowledge management platforms, such as intranets and  wikis .

How to map a digital ecosystem

The digital ecosystem map is essential to any  digital transformation . The goal of the map is to clarify what an organization has to work with, guarantee they have the proper tools to support their goals, and ensure they are being as efficient and effective as possible in achieving those goals.

The following steps can be used to create a digital ecosystem map:

• Create a list of tools. Take inventory of all applications and systems used within the organizations.
• Document who uses the tools. Identify who uses each system and app and who is responsible for each one. This helps ensure all necessary  stakeholders  are included in the ecosystem.
• Categorize the use of every tool. Define what every system and app does and for which department and purpose. Systems should be categorized by ownership and department.
• Form connections between tools. Indicate where data is transferred between tools and whether it is done automatically or manually. Note what tasks are being duplicated and which systems possess similar functionalities.
• Define the effectiveness of every tool. Investigate whether any tools are underperforming and need to be replaced, upgraded or consolidated. Feedback should be provided by the people who use the specific tool every day.
• Prioritize every tool. Rank each tool according to how critical it is to the organization. If tools are going to be replaced or added, consider their importance in terms of their immediate need to the organization and create an order in which they should be implemented.

Types of digital ecosystems

There are three main types of digital ecosystems: the digitizer ecosystem, the platform ecosystem and the super platform ecosystem.

Digitizer ecosystems  focus on digitizing an existing product with the help of business partners, while also maintaining low managerial complexity. Digitizer ecosystems can add new functionality to systems and create digital service revenue. This ecosystem usually incorporates 20 to 100 existing partners across five industries.

The digitizer ecosystem is best suited for businesses with strong product capabilities, limited digital abilities and a primarily internal focus. It works well for organizations looking to make their established product smart and connected. An example of a digitizer ecosystem is an automotive manufacturer that partners to obtain the technology and intellectual property (IP) needed to connect their cars with related digital services.

Platform ecosystems  are more advanced than digitizer ecosystems. They focus on flawlessly connecting users and smart devices on a platform, while simultaneously guaranteeing high service levels and limited obstacles. The platform ecosystem creates revenue streams from platform usage. The data generated by the ecosystem can be used for similar businesses and service models. Platform ecosystems typically have 50 to 10 million partners across a maximum of five industries.

The platform ecosystem works best with companies that have solid digital capabilities and a strong focus on external expertise. Established tech startups and companies are more likely to adapt this platform as their core business model than non tech companies. An example of a platform ecosystem is Xiaomi, a Chinese electronics company that makes and invests in a variety of product types, including smartphones, laptops, fitness brands and mobile apps. Xiaomi works closely with its contributors -- the device makers -- to provide a  smart home  platform, equipped with a variety of smart, connected devices.

Super platform ecosystems  are the most complex type of digital ecosystem. They focus on integrating several platforms into one integrated service, while also capturing user data from the integrated platform. This type of ecosystem provides a wide range of user data and turns the data into money using adjacent business models. The super platform ecosystem typically has at least 10 million partners across at least 10 different industries.

Super platform ecosystems are best suited to companies that possess advanced digital abilities and an established platform from the start, as well as a willingness to work with external partners. As a result, this ecosystem is preferred by well-established tech companies. A good example of a super platform ecosystem is a  virtual assistant  that incorporates shopping, payment, transportation and communication services into one user-friendly option.

Many companies find the best results by using more than one type of ecosystem at a time. For example, Amazon Alexa uses all three. The digitizer ecosystem improves the smart speaker's hardware and  voice recognition  functionality; a platform ecosystem exists for adding skills and applications that are used to increase the services offered by Alexa; and a super platform ecosystem is used to integrate all other platforms.

Why are digital ecosystems important? 

Many organizations' strategies are built on digital transformation. No matter where in the digital journey a company is, it is essential that a digital ecosystem is established to improve performance and assist with interactions outside the company. The digital ecosystem allows an organization to focus its energies on facilitating business value by removing any frustrations linked to outdated,  legacy  B2B services. Furthermore, digital ecosystems add value to customer relationships by helping companies consistently meet service-level agreements ( SLAs ), provide fast fixes and quickly surface expectations.

Digital ecosystems are also transforming  supply chains . Supply chains that originally functioned in separate markets are coming together in digital ecosystems to support the development of new products and services, creating supplier ecosystems. Although the traditional supply chain is still the foundation of most companies, the new model -- digital ecosystems -- is transforming the world of business by creating linear paths between suppliers and customers, thus creating new business opportunities.

Benefits of digital ecosystems

Benefits of a digital ecosystem include the following:

• Faster adoption of technology. Companies can implement new technology in ways that were previously too complicated and unmanageable, allowing them to take full advantage of Cloud services and SaaS.
• Generation of new sources of revenue. Ecosystem integration creates new revenue streams and allows organizations to track and analyze wide-ranging data that flows through the business. They can use this data to create new products and services with increased value.
• Decreased costs with better business processes. Digital transformation and the creation of a digital ecosystem improve workflow efficiency and working relationships with customers and partners. Automated data processes and increased business-wide efficiency also reduce operational costs.

Digital ecosystem best practices

When creating an integrated digital ecosystem, it is important organizations remain open to change. Digital transformation focuses on reworking the products, processes and strengths within an organization by using their current technologies. This reworking cannot proceed if the organization is not willing to embrace all the potential changes.

Other recommended  best practices  for the creation and maintenance of a stable and effective digital ecosystem include the following:

• Rethinking the business model. Business processes , management styles, silos, contracts and governance structures should be reevaluated to determine if they still fit.
• Encouraging an open and collaborative culture. A well-rounded, successful digital ecosystem relies on strong communication and collaboration between companies.
• Gathering a large number of diverse partners. Digital ecosystems need to draw on expertise from other industries. Therefore, the more partners an ecosystem has, and the more industries they come from, the stronger and more productive the ecosystem will be. The average ecosystem has around 27 partners, but the most successful ecosystems have closer to 40.
• Establish a strong user base. In most cases, the most successful digital ecosystems are created and controlled by market share leaders -- companies with the highest profit margin in their specific market -- because these organizations are best positioned to attract partners with the necessary skills and funding.
• Create a large global footprint. The geographic scope of a digital ecosystem is another characteristic of its success. Similar to how it is important to gather a large number of partners, it is also advantageous to collaborate across a multitude of geographic, language and cultural barriers. Average ecosystems often have partners in five locations, while successful digital ecosystems often cover 10 or more countries.
• Stay up to date with technology. Outdated software, failing connections and cumbersome data centers will inhibit sharing and, consequently, innovation. The most successful digital ecosystems invest in the most recent and best technologies on the market, as well as the people who are dedicated to learning about the latest digital capabilities.

Digital ecosystem audits

While digital ecosystems can be extremely beneficial to business processes and efficiency, an unhealthy digital ecosystem can significantly drain productivity, capital and morale. If the systems within an ecosystem are not communicating or require major manual updating for reports to be useful, then the organization is wasting time and energy on efforts that are not growing the business. The best way to ensure ecosystem health is by conducting ecosystem audits .

The primary questions to address in an audit include the following:

• How are the tools managed? Is there an established governance model to support the tools? Is there a roadmap for the future or the ability to address needs as they arise?
• How do the current tools support the company's vision and goals? Do the tools provide a consistent brand experience and personality?
• How does information travel through the organization? How can the digital ecosystem increase support of the organization's operations and workflows?
• How do people collaborate within the ecosystem? What has access to what? What can people do, and how can they do it more efficiently and effectively?

Answering these questions and conducting a full digital ecosystem audit may take a lot of time, but it will provide a deeper understanding of how an organization's digital ecosystem is working. This can then be used to generate significant cost savings and impressive growth for the organization.

Digital Ecosystem Management

Digital Ecosystem Management (DEM) is a new discipline that has emerged for businesses in response to digital transformation and the integration of digital ecosystems. Digital Ecosystem Management focuses on using the ecosystem to grow a business by taking advantage of the creativity of other people and all other available resources.

Examples of digital ecosystems

The modern banking application is one example of a digital ecosystem. The ecosystems created through these apps integrate all services and applications into one place, including expense managers,  digital wallets , online banking and digital passbooks.

Danske Bank, a Danish firm, created an online system combining customer data with housing market listings. This provided potential homebuyers with tax, electric and heating cost estimations; a catalog of realtors, information and service providers; and strong, trustworthy financial advice.

The healthcare industry has also found digital ecosystems to be beneficial. A digital healthcare ecosystem incorporates every touchpoint in a patient's journey, including scheduling appointments, receiving appointment reminders, storing test results and recording prescriptions. The ecosystems help healthcare organizations maintain  compliance  with industry and government requirements by ensuring they have the necessary documentation and audit capabilities to comply with mandates like the  Health Information Exchange  (HIE), the Health Insurance Portability and Accountability Act ( HIPAA ) and the Health Information Technology for Economic and Clinical Health Act ( HITECH ).

Many healthcare organizations are exploring how to integrate artificial intelligence ( AI ) and machine learning ( ML ) into their systems as a way to improve customer experiences and decision-making processes. A digital ecosystem will make this possible by ensuring the correct data is available at the right time, allowing healthcare organizations to take full advantage of the benefits AI and ML offer.

The auto industry is also adopting digital ecosystems. In the past, automotive manufacturers either formed an alliance with an original equipment manufacturer or built contractual relationships with hundreds of suppliers to obtain the necessary parts. Now, a typical auto company will use an ecosystem of more than 30 partners, five different industries and various countries to manufacture cars that are  autonomous , electric and connected to the company's digital platform .

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Ecosystem 2.0: Climbing to the next level

As COVID-19 accelerates customers’ migration to digital , with consumers of all ages going online for everything from food to cars to doctor visits, some companies may feel that the channels, platforms, and approaches they have relied on for years are burning up faster than ever.

The pandemic has magnified a previous trend in which many traditional corporations tried to create or participate in digital ecosystems, only to fall short. These ecosystems consist of interconnected sets of services through which users fulfill a variety of cross-sectoral needs in one integrated experience. Today’s dominant ecosystems were launched by ascendant tech companies, which have used hyperscale platforms  to compete with, disintermediate, and often substitute for the offerings of traditional competitors by controlling customer interfaces and control points such as search, advertising, and messaging.

The market understands this power. Most of the companies with the world’s highest market capitalizations are tech companies that generate much of their revenue from the digital ecosystems they created (Exhibit 1). Many of these ecosystems are B2C plays. Others, such as Jabil’s, represent B2B spaces. Some companies tackle both: Amazon, for example, ties together e-commerce, cloud computing, logistics, and consumer electronics, while China’s Tencent provides services including social media, gaming, finance, and cloud computing.

Can more traditional competitors play this new game? To shed light on that question, we recently looked at the ecosystem strategies of 100 incumbent companies. Our findings suggest there is a path for more established players to use ecosystems to level the playing field. This path has been opened up, in part, by the ubiquity of digitization and data and the emergence of advanced analytics, tools that give companies better insight into customers and market niches, allowing them to personalize products as never before. The path has also been clarified by the mistakes incumbent companies made in their early efforts to participate in digital ecosystems, during an era that might be called Ecosystem 1.0. Absorbing those lessons while making the most of new digital technology can help companies move up their industry’s power curve  in a hurry, executing on practices that turn so-so ecosystem plays into markedly better ones. That’s the promise of Ecosystem 2.0.

An evolving model

How do ecosystems work? For starters, they create value along two dimensions. They allow participants to consolidate a range of customers , often across sectors. Think of this as the horizontal vector. On the vertical vector, ecosystem participants strengthen or even dominate touch points along customer journeys (both B2C and B2B). Of course, ecosystem participants don’t try to do this by building everything they need in-house. Instead, ecosystem organizers provide incentives to and partner extensively with other participants, who may be within their traditional industry boundaries or outside of them. These moves can unleash distributed innovation and create new efficiencies along value chains to improve customer experiences while opening new avenues of value creation for a wide range of participants.

To participate successfully in ecosystems, traditional companies must often change the way they think about customers. Instead of limiting themselves to services within their historical industry borders, they may venture beyond in an effort to serve customers from one end of the customer journey to the other. For instance, opportunistic companies in the housing market—such as the United Kingdom’s ZPG—are trying to create end-to-end ecosystems that may span search, property comparisons, mortgage shopping, household moving, switching phone and cable companies, and access to home-improvement professionals. In fact, we estimate that at least a dozen sectors, including B2B services, mobility, travel and hospitality, health, and housing, are reinventing themselves as vast ecosystems , networks of networks that could add up to a $60 trillion integrated network economy by 2025.

To participate successfully in ecosystems, traditional companies must often change the way they think about customers.

These ecosystems develop in virtuous cycles through network effects. By offering products and services that individual companies could not create on their own, ecosystems draw in more and more customers, which creates even more data, which allows artificial intelligence (AI) to fashion even better offerings, which in turn further improves processes and wins more customers. As ecosystems bridge openings along the value chain, they create a customer-centric, unified value proposition in which users can enjoy an end-to-end experience for a wide range of products and services through a single access gateway. Along the way, customers’ costs go down even as they gain new experiences, all of which whets their appetite for more.

Consumers and companies understand the appeal. Seven in ten consumers we surveyed said they value ecosystem offerings that simplify their purchase journey. Perhaps more surprisingly, 60 percent of US banks we surveyed said they were likely to form or join an ecosystem.

Major technology vendors and suppliers are fueling the growth by keying their strategies to ecosystem players. They furnish hardware and software for platform building and set up data exchanges (application programming interfaces) for ecosystem partners. The growth of 5G  communications is helping to make interconnections faster and more seamless, while “as a service” cloud offerings have multiplied the ways partners can plug into ecosystems. Advanced technology providers are also providing the tools to manage vast databases and using AI to improve how ecosystems understand and attract customers.

Regulators also may be helping out, as they start to sort through the risks and benefits of a more networked economy. In several regions of the world, regulators are looking at ways to level the playing field between digital platforms and traditional companies. The frameworks emerging from their work could ensure data security, portability, and interoperability for consumers and ecosystem partners.

There is a path for established players to use ecosystems to level the playing field. This path has been opened up by tools that give companies better insight into customers and market niches, allowing them to personalize products as never before.

The lessons of Ecosystem 1.0

These technology enablers and regulatory patterns hold considerable promise for incumbent players looking to play the ecosystem game. No, not every company is going to be an Amazon or a Tencent. The ecosystem strategies that companies pursue will vary in scope and ambition, as they should. But our analysis suggests that the efficiencies and potential of ecosystems are such that even a moderate success built on a moderate budget can lead to measurable gains.

To evaluate the success of existing strategies and operating models, we studied 100 traditional companies that have launched ecosystem strategies. 1 Some companies in our sample have announced plans for ecosystems and provided details of their strategies. While there is a lot of activity across this group, few incumbents have achieved significant financial gains. About half have merely started experimenting with ecosystems, perhaps via a low-risk experiment or cross-sector partnership. Some 40 percent have gone far enough to gain customer traffic and clear a viable path to meaningful economic impact. No more than 10 percent of incumbents have established ecosystems that have gained sufficient scale to deliver 5 percent or more of company revenues (Exhibit 2).

The fact that relatively few incumbents have registered big gains may not be surprising. All these companies began in the nondigital world, and most have been experimenting with ecosystems for only a few years. As they do, many encounter organizational hurdles in addition to technological ones. As we dug into their experiences, though, we were able to carve out four lessons from Ecosystem 1.0.

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Lesson 1: go deep or go home.

Going deep does not mean that every incumbent should make a bet-the-company move into organizing or participating in an ecosystem. It does mean that companies should understand the complexities and unfamiliar opportunities that ecosystems present. Many companies are constrained by their own incrementalism. To protect existing lines of businesses, they think small. But the very reason ecosystems exist is to mobilize and incent diverse participants to collectively address the end-to-end needs of consumers.

Doing so requires deep strategic thinking about the key touch points along relevant customer journeys. It means probing value chains for areas where smart shifts can drive big improvements, the way Amazon revolutionized customer experience with one-click shopping and one-day delivery. Even if your company’s participation and investment in an ecosystem are small, your thinking about the customer journey must go deep.

Lesson 2: Move strategically, not conveniently

In launching an ecosystem, incumbents too often covet revenue pools that are on the doorstep of their core businesses. They believe that making small, intuitive moves, such as adding a few clever features or apps to their website, is sensible and sufficient. For example, one bank buffed up its online-lending app, trusting that design tweaks and an advertising push would lure borrowers from beyond its core lending businesses and geographies. Executives were disappointed: few customers even tried the app, much less used it to secure a loan. Why? Because the app didn’t lower borrowing costs or make interactions easier—two key elements of any ecosystem’s value proposition to customers.

The bank’s team hadn’t thought deeply about what would be necessary to shift new customers to their offering. It never invested in the digital talent or capabilities needed to discern user pain points and deliver products that addressed those problems at scale.

Lesson 3: Partner with vision

We know of many cases where two CEOs, keen on duplicating the marquee successes of digital leaders, launched ecosystem initiatives with a burst of enthusiasm and bold visions of combining forces along value chains or pursuing attractive new markets. Invariably, however, their plans foundered on details such as which points along the value chain the company is best positioned to control versus those that partners should own, how participants could mesh capabilities, or how they will jointly manage the novel operating model of their ecosystem.

This kind of failure to develop a deep shared vision prevented an online advertising company and a financial institution from trying to build an ecosystem with breakthrough potential for both. The advertiser rejected the revenue-sharing proposal, and the financial player ended up spending heavily on a gap in its value chain that could have readily been filled with the advertiser’s analytics skills. Neither company had a clear notion of how pooling their expertise would bring in additional customers or revenue. Nor, perhaps, did they share a convincing long-term vision of where their market was headed, a vision that would clarify who would do what while lowering perceived risk for the rest of the potential participants they would need to fully build an end-to-end offering for customers. As a result, both companies failed to expand from mere regional players to national powers.

Lesson 4: Clear the path to impact

Some incumbents do the hard work of deliberating carefully about where to play along horizontals and verticals, assemble all the necessary capabilities for the task, and yet fail to achieve scale or meaningful financial returns. One reason this can happen is that companies don’t get the organizational model right, which itself represents a failure to integrate the lessons of experiments and trials of Ecosystem 1.0.

Here’s what can go wrong inside the four walls of your company: functions or business units may resist change because they aren’t persuaded of the potential value; incentives aren’t tailored to nurture ecosystems; data are siloed; leaders aren’t role models who mobilize change. Ecosystems require strategic and financial foresight, but to succeed they also require careful design and governance planning within the organization to serve the new ecosystem approach.

In the emerging world of Ecosystem 2.0, data are the holy grail, the breakdown of sector borders is a given, and successful players try to lock in control points to expand horizontally and vertically across the grid.

The principles of Ecosystem 2.0

When embarking on ecosystem strategies, many companies use standard frameworks to determine which new revenue pools to pursue. As a result, they rarely look beyond the obvious adjacencies. What’s needed for the evolving world of Ecosystem 2.0, however, is a holistic approach guided by the following three principles:

Use strategic mapping to identify control points. Holistic ecosystem strategies spring from a top-down view of the potential span of impact, as well as a nuanced approach designed to nurture multiple initiatives by the many players participating in an ecosystem. The first step, whether you are organizing or participating in an ecosystem, is mapping against your existing business the horizontal and vertical dimensions of the large ecosystem in which you operate or would like to operate. The map will illuminate “control points,” or places on the map where the company could maximize impact on the value chain by deploying or attracting the right capabilities into the ecosystem. The map will also reveal how far removed your business is from these control points. Companies that find themselves closer to a control point might look to organize an ecosystem around it. If they find themselves further away, they might look to move closer or choose instead to participate in ecosystems formed by more natural owners of a given control point.

In general, control points are where capabilities can best be deployed to remove pain points and smooth the course of customers’ journeys. Mastery of one or more of these control points provides the base for horizontal and vertical moves that can propel your company into new sectors, new sets of customers and business partners, and even new businesses.

Lock in impact with precise capabilities. Mapping is a forcing mechanism for prioritizing control points. Companies that want to create value from the control points they have identified must then assemble and attract the capabilities needed to improve customer journeys. To do so, they may have to invest in reworking and tailoring existing capabilities, or they may need to attract partners that can fill the gaps. The elements that incumbents often lack are advanced digital skills such as AI, functional know-how such as digital marketing, high-level supply-chain and logistics skills, and innovation capabilities to increase the value of products and services. As we mentioned, tech companies have made it easier than ever for incumbents to find appropriate partners to deliver such digital expertise. Articulating the right vision for where the market is headed, combined with creating a platform that, by lowering interaction costs and boosting learning, lowers the investment costs for other companies, helps make the whole greater than the sum of its parts and promotes distributed innovation.

Locking in impact with appropriate capabilities at these control points is how ecosystems and the companies in them extend their reach and create value. Successful companies work on control points with focus and intentionality to align ecosystems precisely with what customers want and expect—and to attract into the ecosystem the partners they need to accomplish that.

• Design the organization for many participants and customers. Successful ecosystems are designed to win market gains and create value for all participants. That’s certainly what investors want to see. But companies that intend to orchestrate or participate in ecosystems must balance a tricky set of issues both within and beyond their own boundaries. Internally, they have to find the right organizational model. Here, companies typically err by going to extremes. One extreme approaches too narrowly, through an organizational silo—say, tackling the entire housing ecosystem through the department or function that works on mortgages. In this model, capabilities will be lacking, and achieving scale difficult. At the other extreme, companies use the venture-capital model to buy companies they think are needed, such as technology-platform providers, and then struggle to integrate the acquisition with their current capabilities, go-to-market approaches, and data systems. The right model will fall somewhere in the middle, tailored to both internal and market context.

Externally, orchestrating companies must encourage collaboration, in part through transparent sharing of data, in part by being careful to leave value on the table for all participants (rather than hoarding all of it), and in part by thinking through and designing mechanisms for dispute resolution and the cross-ecosystem learning that collaboration enables. Particularly for companies in the orchestrator’s position, success requires protocols and designs from which all participants benefit and profit. That includes benefiting customers, of course, which is perhaps the most difficult piece of all. One financial-institution CEO girding for the challenge told us, “We proved we can do this for 20,000 customers. Now we need to scale it to 20 million.”

Ecosystem 2.0 in action

In theory, participating successfully in ecosystems or orchestrating them can sound like a high-wire act. In practice, it may not feel as daunting. Let’s look at the experiences of three incumbents that successfully applied the principles from the previous section.

Mastering control points

At one global bank, leaders decided they would finally confront a problem that had bedeviled them for years: how it could better serve the small-business market. A marketing push and the addition of a small-business area to their well-regarded website had done little. Executives realized that if they were ever to make a successful horizontal move into a market crowded with sophisticated competitors, they needed a much better understanding of the needs of small-business customers. They assembled a team from business development and lending operations to map out small-business journeys and identify the biggest pain points. The much-needed exploration returned valuable discoveries. The team found that their traditional value-chain strengths, which served large corporate clients well, were a poor fit for small-business owners. But their efforts did identify two potential control points: small businesses needed help initiating new business propositions and managing their ongoing businesses effectively.

Bank leaders took an Ecosystem 2.0 approach to the problem. To get an edge in the first control point, they went outside to partner with a company specializing in company registration and launch-related services. But for the second control point—delivering targeted services to help improve business administration—the team found that they had many of the relevant assets and expertise in-house. Senior management authorized a substantial investment to ensure that this in-house group could deliver a set of distinctive small-business services. The team then forged a partnership between an outside invoicing and accounting-services player and an in-house design team to integrate its partnership offerings with its existing banking services.

When it had armed itself with substantial services at critical small-business control points, the bank tested its offerings in a small market and quickly began attracting new customers. Top leaders authorized the significant investment needed to scale the new business line, sweetened the revenue-sharing agreement with its partner to secure this critical alliance, and approved plans to further develop the nascent ecosystem.

In theory, participating successfully in ecosystems can sound like a high-wire act. In practice, it may not feel as daunting.

Reworking the value chain

An industrial-products manufacturer faced new global competition and slowing growth. During a yearly strategic review, senior leaders asked the strategy team whether there were opportunities along its value chain that could capitalize on the company’s sizable base of loyal customers. The manufacturer’s products were equipped with sensors to create data to evaluate performance, which supported an existing after-sales service business. Strategists reasoned that there might be additional control points to exploit and, in collaboration with marketing and sales, discovered that many of its customers were relatively inexperienced in leveraging data analytics to guide businesses decisions and were eager for better insights. The company decided to offer its own data-analytics services, and it set about creating an ecosystem of partners who could make that happen.

The central challenge was combining the company’s proprietary data from equipment sensors with outside data and number-crunching skills. To add a macro lens, the company teamed up with a well-regarded forecaster of economic and industrial business conditions. It partnered with a start-up and a large global transportation company that both had expertise in AI-backed logistics. It brought in another promising start-up that used AI to generate B2B end-customer insights for buyers of its industrial gear. This cobbled-together data-services business delivered significant share gains in its very first year, helped defer a planned move into the space by a major digital player, and attracted users beyond the company’s core product lines. The company eventually partnered with a global manufacturer to expand into new niche markets.

From vertical to horizontal

An emerging-market bank had successfully expanded into several new segments. Wherever it went, the bank had a commanding ecosystem control point: thanks to its superior analytics capabilities, it could introduce seamless digitized banking journeys that were very popular. With strong brand recognition across its markets and an increasing number of customers reaching middle-class status, the bank’s top leaders decided the time had come to exploit that control point horizontally. Believing that their proven platform might attract customers in other sectors, they led a mapping exercise looking at consumer journeys in sectors well beyond traditional banking and finance. Combining that research with analytics that discerned purchasing trends among its banking clients, leadership decided that a bold lateral move into e-commerce, travel, food and dining, and even health services might pay off.

They had no illusions about their own organization; they knew it lacked the entrepreneurial capabilities for such an effort. So they set up a new entity to build and manage a platform that came to include dozens of partners. A few years later, the company is attracting several million customers each month to its nonbanking ecosystem offerings, while its banking and finance businesses have grown rapidly as the ecosystem has expanded.

Just a few years ago, incumbent companies were only awakening to the shifts in competition and organization that ecosystems might bring. Since then, players have accumulated lessons and notched successes. The focus now is on proven practices that lead to scale and improved returns. In the emerging world of Ecosystem 2.0, data are the holy grail, the breakdown of sector borders is a given, and successful players try to lock in control points to expand horizontally and vertically across the grid. Every company needs to be watching this trend closely, since the players that first master the new architecture are likely to capture sizable benefits.

Violet Chung is a partner in McKinsey’s Hong Kong office, Miklós Dietz is a senior partner in the Vancouver office, Istvan Rab is a solution manager in the Budapest office, and Zac Townsend is an associate partner in the San Francisco office.

The authors wish to thank Venkat Atluri, Nicolaus Henke, Vinayak HV, Xiang Ji, Tamas Kabay, Hamza Khan, Nemanja Predojevic, Hamid Samandari, Imre Szilvacsku, and Hugo Tong for their contributions to this article.

This article was edited by Rick Tetzeli, executive editor of McKinsey Quarterly, who is based in the New York office.

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Electronic Theses and Dissertations

Essays on business value creation in digital platform ecosystems, document type.

Dissertation

Degree Name

Doctor of Philosophy

Information Systems

Committee Chair

William J Kettinger

Committee Member

David Kemme

Digital platforms and the surrounding ecosystems have garnered great interest from researchers and practitioners. Notwithstanding this attention, it remains unclear how and when digital platforms create business value for platform owners and complementors. This three-essay dissertation focuses on understanding business value creation in digital platform ecosystems. The first essay reviews and synthesizes literature across disciplines and offers an integrative framework of digital platform business value. Advised by the findings from the review, the second and third essays focus on the value creation for platform complementors. The second essay examines how IT startups entering a platform ecosystem at different times can strategically design their products (i.e., product diversification across platform architectural layers and product differentiation) to gain competitive advantages. Longitudinal evidence from the Hadoop ecosystem demonstrates that product diversification has an inverted U-shaped relationship with complementors success, and such an effect is more salient for earlier entrants than later entrants. Earlier entrants should develop products that are similar to other ecosystem competitors to reduce uncertainty whereas later entrants are advised to explore market niche and differentiate their products.The third essay investigates how platform complementors strategies and products co-evolve over time in the co-created ecosystem network environment. Our longitudinal analysis of the Hadoop ecosystem indicates that complementors technological architecture coverage and alliance exploration strategies increase their product evolution rate. In turn, complementors with faster product evolution are more likely to explore new partners but less likely to cover a wider range of the focal platforms technological layers in subsequent periods. Network density, co-created by all platform complementors, weakens the effects of complementors strategies on their product evolution but amplifies the effects of past product evolutions on strategies.This three-essay dissertation uncovers various understudied competitive strategies in the digital platform context and enriches our understanding of business value creation in digital platform ecosystems.

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Li, He, "Essays on Business Value Creation in Digital Platform Ecosystems" (2019). Electronic Theses and Dissertations . 2924. https://digitalcommons.memphis.edu/etd/2924

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The Constitutionalisation of the Digital Ecosystem: Lessons from International Law

Max Planck Institute for Comparative Public Law & International Law (MPIL) Research Paper No. 2021-16

In: M. Kettemann, R. Kunz, A. Jr Golia (eds.), International Law and the Internet (Nomos: Baden-Baden, Forthcoming)

24 Pages Posted: 28 Jun 2021

Edoardo Celeste

Dublin City University - School of Law and Government

Date Written: June 23, 2021

A complex process of constitutionalisation is currently under way within contemporary society. A multiplicity of normative counteractions is emerging to address the challenges of the digital revolution. However, there is no single constitutional framer. In a globalised environment, constitutionalisation simultaneously occurs at different societal levels. Not only in the institutional perimeter of nation-states, but also beyond: on the international plane, in the fiefs of the private actors, within the civil society. This paper examines to what extent international law scholarship may offer a useful theoretical toolbox to understand the multilevel phenomenon of constitutionalisation of the digital ecosystem. International law theory indeed already projected the notion of constitution beyond the state dimension, helping explain how the emergence of globalised problems in the digital ecosystem necessarily engenders the materialisation of a plurality of constitutional responses. It will be argued that the sense of this Gordian knot can be deciphered only if these emerging constitutional fragments are interpreted as complementary tesserae of a single mosaic. Each one surfacing with a precise mission within the constitutional dimension, each one compensating the shortcomings of the others to achieve a common aim: translating the core principles of contemporary constitutionalism in the context of the digital ecosystem. Constitutionalising the digital ecosystem is not synonymous of en bloc codification, but rather represents a gradual process of translation of principles and values. Constitutionalisation does not merely imply the imposition of new constitutional rules, but also includes a substantial bottom-up societal input. All the various scattered components of the process of constitutionalisation of the digital ecosystem equally contribute to substantiate the ideals and values of digital constitutionalism, which represents a new theoretical strand within contemporary constitutionalism aiming to adapt its core values to the needs of the digital ecosystem.

Keywords: international constitutional law, constitutionalisation, globalisation, compensatory constitutionalism, digital constitutionalism

Suggested Citation: Suggested Citation

Edoardo Celeste (Contact Author)

Dublin city university - school of law and government ( email ).

Dublin Ireland

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The smart classroom: learning challenges in the digital ecosystem.

1. Introduction

2. materials and methods, 3.1. smart classroom educational resources, 3.2. teaching and learning practices and methodological change, 3.3. educational roles, 3.4. axiological principles of the smart classroom, 4. discussion, author contributions, informed consent statement, data availability statement, conflicts of interest, references and notes.

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Pardo-Baldoví, M.I.; San Martín-Alonso, Á.; Peirats-Chacón, J. The Smart Classroom: Learning Challenges in the Digital Ecosystem. Educ. Sci. 2023 , 13 , 662. https://doi.org/10.3390/educsci13070662

Pardo-Baldoví MI, San Martín-Alonso Á, Peirats-Chacón J. The Smart Classroom: Learning Challenges in the Digital Ecosystem. Education Sciences . 2023; 13(7):662. https://doi.org/10.3390/educsci13070662

Pardo-Baldoví, M. Isabel, Ángel San Martín-Alonso, and José Peirats-Chacón. 2023. "The Smart Classroom: Learning Challenges in the Digital Ecosystem" Education Sciences 13, no. 7: 662. https://doi.org/10.3390/educsci13070662

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• DOI: 10.3897/rio.10.e125450
• Corpus ID: 270575714

Prototype Digital Twin: Recreation and biodiversity cultural ecosystem services

• S. Rolph , Chris Andrews , +9 authors Jan Dick
• Published in Research Ideas and Outcomes 17 June 2024
• Environmental Science

14 References

Species richness alone does not predict cultural ecosystem service value, practical application of spatial ecosystem service models to aid decision support, cultural ecosystem services and decision‐making: how researchers describe the applications of their work, protecting biodiversity (in all its complexity): new models and methods., a standard protocol for reporting species distribution models, environmental tastes as predictors of environmental opinions and behaviors, interface to the global 'biodiversity' information facility'api', bias and information in biological records, a mixed-methods approach to analyse recreational values and implications for management of protected areas: a case study of cairngorms national park, uk, related papers.

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How a Digital Ecosystem Works: Types, Benefits, and Examples

Digital ecosystems are platforms like app stores and online libraries that bring together customers and interrelated products in one accessible place.

The digital landscape is no longer a collection of websites and apps that function in isolation. Instead, it’s more like a web of ecosystems, each composed of interconnected products.

These digital ecosystems consist of information technology resources—from apps to data platforms —that facilitate collaboration and data exchange and benefit both business partners and customers. Companies can leverage these ecosystems to reach new customers and new revenue streams.

By understanding the dynamics of digital ecosystems, we can become more informed ecosystem participants in the ever-evolving digital world.

What is a digital ecosystem?

A digital ecosystem is a network of interconnected information technology resources—websites, apps, devices, and data—that function together to support actions like online shopping and education.

Digital ecosystems often involve collaboration between internal and external participants. In one model, a company creates its own in-house digital ecosystem by integrating the various software and tools it uses to conduct business. This internal ecosystem facilitates workflows and data exchange.

However, digital ecosystems often involve multiple companies. These ecosystems connect businesses, partners, and even customers, fostering collaboration and innovation. You can see an example of a successful digital ecosystem in the Apple App Store, which brings together app developers and iPhone users. This multi-company approach creates a richer and more dynamic ecosystem for everyone involved. 

Types of digital ecosystems

Functional digital ecosystems, platform ecosystems, super platform ecosystems.

Digital ecosystems come in various forms, each with its own structure and level of complexity. Here’s a breakdown of three prominent types of digital ecosystems:

These are the simplest forms of digital ecosystems, built around a single company’s offerings. They provide a cohesive customer experience by integrating a diverse set of functionalities within a company’s existing product or service suite. An example of this would be a photo editing software program that allows users to connect with the program’s cloud storage service and stock photo library. This ecosystem caters to photographers by offering all the tools they need on a common platform.

Platform ecosystems are more complex and involve multiple companies collaborating on a central platform. The platform facilitates interactions and data exchange between ecosystem participants with interconnected information technology resources.

The online learning platform Coursera is a prime example of a platform digital ecosystem. Coursera acts as the central platform facilitating course delivery, student enrollment, and interaction, while multiple universities and instructors provide valuable content that attracts users. With this integrated digital ecosystem students get access to diverse learning opportunities (more than they would from a single company or educational institution), instructors expand their reach, and Coursera generates revenue from its network of participants.

Super platform ecosystems are the most extensive and influential, often encompassing a vast network of platforms, services, and devices. They act as dominant players in the digital landscape, shaping user behavior and influencing various industries.

Large tech companies like Amazon are a good example of super platform ecosystems. Amazon functions as an online marketplace, but it also integrates features like cloud services, payment processing, and content streaming platforms (like Prime Video). A super platform ecosystem offers a comprehensive suite of services and often has a global footprint, making it a one-stop shop for many consumers.

Benefits of digital ecosystems

Enhanced user experience, multi-company partnerships, streamlined operations, business value creation.

Successful digital ecosystems benefit both businesses and users. Businesses gain access to new markets, streamline operations, share data, and create connected products through collaboration. Users enjoy a more convenient and feature-rich experience with integrated products and services.

Here is a deeper dive into four of the primary benefits of digital ecosystems:

A robust digital ecosystem removes obstacles from user journeys by integrating products and services. Imagine a fitness tracker app connecting with a smartwatch, a meal planning app, and a music streaming service—all at once. This ecosystem allows users to track workouts, monitor calorie intake, and listen to motivational music—all within a single digital platform.

These digital ecosystems allow businesses to tap into new markets and attract partners through multi-company partnerships. For instance, a ride-sharing app may partner with a performance venue, offering concertgoers discounted rides to and from shows if they book through a third-party ticketing app.

Each ecosystem participant—the ride-sharing app, the venue, and the ticketing company—gets new users and access to shared user data. This collaboration lowers customer acquisition costs for the businesses, while users reap the benefits of discounted rides and a seamless customer experience.

Data exchange within successful digital ecosystems allows businesses to optimize workflows and personalize user experiences. For instance, if an ecommerce platform integrates with a logistics company’s network, it can leverage real-time data to recommend faster shipping options and track deliveries to better serve customers.

Collaboration within digital ecosystems fosters innovation. Ecosystem partners in a healthy digital ecosystem can leverage each other’s strengths to create new products and services and harness new revenue streams.

Roles in a digital ecosystem

Within a digital ecosystem, companies can occupy various roles at various points, each contributing to the overall network’s functionality. Here are three key roles companies can play:

In this role, companies use the services and products offered within the ecosystem to achieve their own goals. For example, a small marketing agency might use a cloud-based design platform and a social media management tool within a larger digital ecosystem. These tools help them create graphics and manage client social media accounts efficiently.

These companies create and provide valuable products or services within the ecosystem and play a crucial role in shaping a positive user experience. Modular producers create specialized tools and services that integrate seamlessly with existing platforms. For example, a software company could create a project management tool that complements the functionality of popular chat and video conferencing tools.

Orchestrator

These companies act as the central hub, facilitating business intelligence and data exchange between different ecosystem participants. They often manage the infrastructure and data and establish rules and standards for the ecosystem to function smoothly, ensuring a cohesive customer experience. Social media apps such as Facebook are orchestrators that facilitate the interactions between numerous producers—brands, news websites etc.—and individual consumers.

Digital ecosystem FAQ

What are examples of digital ecosystems.

Amazon is an example of a digital ecosystem since it provides an online marketplace, video and music streaming, smart home devices, payment processing services, and more—all of which are interconnected.

What is the difference between a digital platform and a digital ecosystem?

Digital platforms are hosts that connect various users and facilitate transactions. A digital ecosystem is a broader term that includes some platforms that facilitate multiple kinds of exchanges. For example, a digital platform may host buyers and sellers of second hand goods. If it integrates with a logistics platform to share data and provide seamless delivery to users and improve customer journeys, it may be considered a digital ecosystem.

What are the functions of digital ecosystems?

Digital ecosystems connect platforms, services, and devices to support the exchange of data and functionalities between participating companies. They aim to provide a richer customer journey by streamlining business processes and offering a wider range of connected products and services.

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From online to onsite: Wanghong economy as the new engine driving China's urban development

Considering China's 'isolated' digital ecosystem, this paper examines China's 'check-in' activities to understand how the wanghong economy is driving China's new rounds of urban development, with the purpose of supplementing existing research on digital economies from the Chinese context. Focusing on a representative case study area called Dongshankou in Guangzhou, which is regarded as one of the most popular wanghong places and an emerging commercial centre, I sought to enrich existing studies about digital economies and extend scholarship on platform urbanism from the cultural economy perspective. First, I argue that Chinese consumers' check-in activities function as the data accumulation process, structuring Dongshankou's digital capital through the assemblage of online posts and geotags. Therefore, Dongshankou's urban development challenges the conventional view of creativity as the key factor in the cultural economy for urban development, given that digital capital is now the key driver for urban development in the digital age. Second, the growth of wanghong stores in Dongshankou reveals how the wanghong economy is materialised into urban cultural objects. Emotional value – a crucial selling point that these wanghong stores aim to provide to facilitate consumers' check-in activities – illustrates how China's highly participatory digital ecosystem extracts users' emotions and bodily experiences into the process of capital accumulation, which structures the 'platform urbanism' through our daily lives. This paper broadens the horizon for an alternative theoretical agenda in platform urbanism: beyond focusing solely on platform algorithms, how digital platforms and emotions become inextricably linked in economic production should be further explored.

The speeding up of marine ecosystems

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• Other Affiliation: School of Biological, Earth and Environmental Sciences, University of New South Wales, NSW, Australia
• Other Affiliation: School of Biological, Earth and Environmental Sciences, University of New South Wales, Australia
• Affiliation: College of Arts and Sciences, Department of Biology
• Four drivers of global change are acting in concert to speed up the ecology of our coastal and open ocean ecosystems. Ocean warming, nutrient pollution, disturbance, and species additions increase biological and ecological rates, favoring weedy communities and causing pervasive human impacts. Ocean warming via greenhouse gas emissions is accelerating metabolic processes, with effects scaling up to populations and ecosystems. Likewise, supercharging primary production via increased resources (e.g., nutrients and light) is leading to faster, weedier communities in estuarine and coastal ecosystems. Disturbances like ocean heat waves are becoming more frequent, resetting succession, and creating permanently young assemblages, while species additions are transporting the quick-growing and the fecund. The speeding up of marine ecosystems will necessitate changes in the ways we do science, attempt conservation, and use ecosystem services.
• https://doi.org/10.17615/eqwd-5731
• https://doi.org/10.1016/j.ecochg.2022.100055
• Climate Change Ecology
• Directorate for Geosciences

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• UNC-Chapel Hill Climate Change Resources

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• Energy and resources
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Microsoft partners celebrate AI innovation

• By Darryl Willis, Corporate Vice President, Worldwide Energy and Resources Industry
• Azure Data Manager for Energy
• Azure OpenAI Service
• Dynamics 365
• Microsoft Fabric
• The Microsoft Cloud
• Content type

To provide sustainable, secure, and affordable energy for more than 8.1 billion people worldwide, the energy industry is turning to AI to speed the journey to a low-carbon future. Coming together in an ecosystem of energy innovation, Microsoft partners and customers are using the latest advances in AI to revolutionize the industry—decarbonizing traditional energy sources and increasing the efficiency and availability of renewable energy sources.  

The goal of achieving net-zero emissions by 2050 requires tremendous investment and rapid innovation. From solutions that optimize grid management and carbon capture and storage to more sustainable, resilient mines , AI technologies can help address the biggest challenges in the complex, multidimensional global energy transition.  

Microsoft for Energy and Resources

Achieve more in the energy and resources industry with trusted solutions from Microsoft.

Accelerate the clean energy roadmap with new AI innovation 

We’re proud to share some highlights from the past year, starting with the announcement that Cognite is Microsoft Partner of the Year 2024 . Cognite and finalists Scheider Electric, Accenture-Avanade, and Kongsberg exemplify the new wave of innovation currently transforming the energy sector.  

Cognite is integrating new AI advances shared at last year’s Ig n ite event , including Microsoft Fabric and expanded Microsoft Copilot experiences. In January 2024, Microsoft and Cognite announced a collaboration that integrates flagship product Cognite Data Fusion with Microsoft Fabric and Azure OpenAI Service. Cognite AI is a prebuilt, comprehensive AI architecture specifically designed for energy and resource companies to deliver a faster path to implementing AI. Cognite Data Fusion incorporates AI across the data stack from generative AI-powered contextualization to an intuitive natural language Copilot interface embedded in day-to-day tools. Most recently, Cognite announced a new solution, Cognite Atlas AI which brings context augmentation generation to Microsoft Azure OpenAI Service, pushing the boundaries of what language models can do for industrial organizations

Schneider Electric continues making an impact with solutions that accelerate digital transformation and sustainability. Built on Azure, the Schneider Electric EcoStruxure Grid solution portfolio shows the company’s commitment to a more digital and electric world, and together with its Grid Operations Platform as a Service, supports the growth of distributed energy resources, microgrids, energy communities, and other flexible resources across digitally planned, designed and operated lifecycles. AVEVA , part of Schneider Electric, also uses Microsoft technology to help accelerate the energy transition and support long-term decarbonization with a cloud-native industrial data and application platform to give energy companies a digital backbone to unlock, contextualize, and share data for better decision making and more profitable and efficient operations. 

Driving more sustainable, efficient operations in asset-heavy industries, Kongsberg leverages the Microsoft Cloud and AI for its Industrial Work Surface, an industrial metaverse that includes mixed reality and digital twins. The solution is designed to help energy companies improve decision-making, maximize business performance, and drive value across the organization—in support of the world’s growing demand for more secure, equitable, and sustainable energy.

Microsoft partners SLB, Halliburton, and Accenture are also innovating with Microsoft Azure Data Manager for Energy , a secure, reliable, hyperscale and fully managed cloud-based data platform service. Customers can speed toward goals by taking advantage of easy interoperability across an extensible application ecosystem. They can integrate virtually any dataset, application, or cloud service while leveraging the applications they already use from SLB, Halliburton, Accenture, and many others. The platform is expanding to new regions and offers a new developer tier pricing to increase accessibility for more partners and customers. 

We are also pleased to announce EY as the Sustainability Changemaker for the second year in a row. Creating customer tools built on Microsoft technology has positioned EY as a leader in sustainability consulting within the energy sector. With EY’s tailored solutions, decision-makers in the energy industry can now oversee transformations across their enterprises, leveraging technology and data to modernize governance structures, tackle industry-specific risks, meet environmental, social, and governance (ESG) obligations, and deliver value for both their organizations and their stakeholders. These solutions provide a comprehensive view into energy demand, verifiable and assured value chain data, and sustainability performance management, enabling energy companies to achieve their sustainability goals and enhance operational efficiency.

Sharing thought leadership at industry events 

You can learn more about Microsoft and partner innovations at Microsoft Ignite either online or in person in Chicago on November 18 to 22, 2024. This is the first Ignite event to include both customers and partners, and we hope you’ll join us to celebrate our partners and learn more about how the latest advances in AI are delivering business value to our energy customers. 

The Microsoft Energy and Resources Industry team is also excited to connect with customers and partners at upcoming events including the ONS conference in Stavanger on August 26 to 29, 2024 and the SLB Digital Forum 2024 in Monaco on September 16 to 19, 2024. These events will feature how new developments in AI and other digital technologies are transforming energy systems for a more secure, equitable, and sustainable energy future. You can always anticipate exciting news at the SLB Digital forum, where two years ago SLB announced the availability of the SLB Enterprise Data Solution, a comprehensive data management toolkit built on Azure Data Manager for Energy . The innovation is a result of the expanded strategic partnership between SLB and Microsoft, includes enhancements to Azure Data Manager for Energy, and a carbon capture and storage (CCS) initiative with Northern Lights joint venture to support global climate goals by accelerating development of scalable, cost-effective solutions for the CCS value-chain. 

Energizing the energy transition with new startups 

The climate crisis affects people globally, and an inclusive startup ecosystem is critical for helping ensure that solutions have far-reaching benefits. We are proud to support underrepresented startup founders at events like CERAWeek and through programs such as Advancing Climatetech and Clean Energy Leaders Program (ACCEL) from Greentown Labs, Browning the Green Space, and the Energy Transition Studio for Startups which we launched this year in cooperation with high-growth climate tech companies FlexDAO, Line Vision, and Utilidata. The program is designed to empower energy transition startups worldwide, and we are pleased to welcome six more companies to the first cohort, including Carbon Guardian, GridBeyond, Hygenox, IEMS, Noda Intelligent Systems, and Norwegian Hydrogen.

Investing in sustainable AI 

In addition to supporting startups, we are also engaging in strategic regional partnerships to help ensure a sustainable future and equitable access to energy and digital technologies for everyone. Microsoft is investing $1.5 billion in G42 , a leading AI company based in Abu Dhabi, to co-innovate and deliver advanced AI solutions with Azure across the Middle East, central Asia, and Africa. Microsoft and G42 are partnering to invest $1 billion in a data center and Kenya, which will be powered by geothermal energy and give east Africa access to Microsoft Azure. Other global investments include a $2.2 billion investment in Malaysia’s cloud and AI transformation , and a significant commitment to enable a cloud and AI-powered future for Thailand . 

Unlocking the transformative potential of AI for sustainability also requires best practices for investment, digital and data infrastructure, resource usage—such as Microsoft’s deal with Brookfield Asset Management to invest more than $10 billion on renewable energy capacity to power data centers—policy and governance, and workforce development. To learn more about AI enablement, read the Microsoft AI and Sustainability Playbook. We are also investing in the sustainability of AI itself, with projects to optimize datacenter energy and water efficiency. 

Partnerships to advance our energy future 

This blog reflects the power of partnership and the growing importance and potential for AI in the energy industry and beyond. This has been a year of exciting change, with groundbreaking advances like the launch of Copilot+ PCs—from both Microsoft and our OEM ecosystem—partnership with OpenAI, and a rethinking of our cloud infrastructure to optimize performance and energy efficiency . 

Microsoft Copilot continues to evolve, with innovations that include the world’s first Copilot in both CRM and ERP with Microsoft Dynamics 365 Copilot. Chevron is already using Copilot in Dynamics 365 Guides to transform frontline operations and optimize its operations, empower workers, and infuse informed decisions throughout its value chain. 

Success stories like these remind us once again that people working together are at the heart of every broad-sweeping, foundational transformation. The world’s complex energy challenges demand global collaboration as we advance toward a more secure, equitable, and sustainable future in an ever-evolving ecosystem of innovation.  

Learn more about Microsoft Energy and Resources solutions 

• Energy and resources – Microsoft Industry Blogs  
• Microsoft energy partner webinar series  
• Microsoft AI solutions   
• Microsoft Azure AI services   
• Microsoft Intelligent Data Platform   

Related posts

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IMF Working Papers

Crypto as a marketplace for capital flight.

Author/Editor:

Clemens M. Graf von Luckner ; Robin Koepke ; Silvia Sgherri

Publication Date:

June 28, 2024

Electronic Access:

Free Download . Use the free Adobe Acrobat Reader to view this PDF file

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

This paper shows how cryptocurrency markets can fuel cross-border capital flight by serving as marketplaces that match counterparts with and without (illicit) access to FX. In countries where international transactions are restricted, crypto exchanges effectively allow domestic agents to pay a premium to buy foreign currency. The counterparts to these transactions are agents with access to FX, who sell crypto holdings purchased abroad. A stylized model illustrates that restricted foreign currency amid economic imbalances incentivizes these transactions via persistent crypto premia in local relative to global markets. We analyze relative crypto pricing data in several country case studies, providing empirical support that crypto markets serve as marketplaces for capital flight that already took place, rather than a novel channel for capital flight. We make available a novel dataset on crypto market premia, which we propose as indicators of excess demand for foreign currency and capital control intensity. The dataset will be posted along with this paper and updated periodically.

Working Paper No. 2024/133

Balance of payments Capital controls Capital flow management Capital flows Capital outflows Currencies Exchange rates Financial account Foreign exchange Money

9798400279348/1018-5941

WPIEA2024133

Please address any questions about this title to [email protected]