By embracing the co-economy, your organization’s processes and culture around co-development will change.
During the late 20th century, industrial technology providers focused on delivering complete, turnkey solutions by themselves. The thought was that to effectively address highly specialized and complex environments, a vertically integrated approach would produce a better outcome.
Today, that mindset has drastically shifted.
The accelerated pace of technology innovation has driven end customers to question this single-vendor model. Now, customers are increasingly embracing the open model involving multiple partners developing solutions based on open standards and the latest technology. Such solutions are typically better future-proofed, more cost effective and agile.
Welcome to the 21st century, where opportunities are enabled by collaboration, co-development, co-marketing and co-innovation. Welcome to the co-economy, and its “co-everything” approach.
In the co-economy, single vendor, end-to-end, custom solutions are being replaced by market-leading offerings from multiple horizontal, vertical and regional specialists. These solutions are based on open standards and tested for interoperability. At the same time, vertical integration has given way to broad ecosystems of collaborating partners—vendors, customers, startups, integrators and services providers—who work together to co-develop and integrate these best-of-breed solutions.
This new model is finally arriving in a business environment that demands speed, improved customer service, greater agility, better responsiveness, lower costs and compelling customer experiences. Clearly, no company can meet these rapidly changing needs by itself.
Broaden your circle
The co-economy is changing how we think about the roles of our technology vendors, integrators, customers and partners. Depending on the mix of tasks at a given time, a company can play any or all of these roles. In addition, the co-economy is reshaping internal processes, reaching across organizational barriers and driving collaboration among previously isolated business units. For example, information technology (IT) and operational technology (OT) are coming together around the Internet of Things (IoT), which requires the network and security expertise of IT, and the domain expertise of OT.
No matter your role in the technology ecosystem, it’s time to broaden your circle of cooperation, finding new ways to work with new kinds of partners. After all, new co-development models are customer-centric, and customers’ IT departments aren’t the only ones looking to co-innovate – their lines of business (LOBs) also want to work with you on solutions that deliver specific business outcomes. Thus, vendors need to form ecosystems of partnerships that focus on customers’ business challenges rather than their own technical offerings.
This shifting landscape is reshaping entire industries. For example, the transportation, manufacturing and technology sectors have long-resided in separate universes. Today, companies as diverse as Mercedes, Google and Uber are racing to develop innovations like the self-driving car. These formerly separate industries are chasing the same pools of talent to work on different sides of the same innovation effort.
Work together, win together
Think of the co-economy as a mindset, a process and a value proposition by which organizations partner with other organizations, combining their skills, talents and resources for anything from a one-off project to an ongoing initiative.
A good example of a co-economy in action involves an IoT disaster management solution in Glasgow, Scotland, delivered by an ecosystem of partners and stakeholders. For this project, Cisco (disclosure: I am employed by Cisco) brought its horizontal expertise in IT infrastructure, collaboration and security, along with deep IT industry knowledge. Bronze Labs, (also a horizontal provider) offered IoT software, and Leonardo (a vertical expert) provided high-tech aerospace and defense expertise. The three companies worked with geographic players such as Scottish Water and the Glasgow City Council to ensure the project fit local needs. The result is a hyperlocal IoT solution that collects and visualizes data from fire engines, ambulances and volunteer networks to predict and help coordinate first responders during disaster situations – a solution that none of these partners could deliver alone.
Keep in mind that the overriding purpose of any co-economy initiative is to anticipate and satisfy the customer’s current and future needs. Therefore, the customer is quite often a key collaborator. In other words, when you start with the customer and co-create with them throughout the development lifecycle, you’ll find new ways to develop products and services, and new ways to create value. And, when a customers’ customers become yours too, the co-economy offers many new ways to prosper.
Here are just a few examples of how the co-economy delivers immediate measureable business value:
- Faster time to market through parallel innovation and development
- Better, more and faster innovation by engaging multiple collaborative teams
- Improved quality with multiple hands checking the work
- Reduced costs through sharing financial burdens
- Expanded customer satisfaction and service by delivering what the customer wants faster
- Reduced risk with more partners sharing and mitigating the risks
You can add greater creativity, completely new business processes and more options tomorrow that weren’t even imagined today – the sky is the limit.
By embracing the co-economy, your organization’s processes and culture around co-development will change. You’ll dismantle silos and develop a strong ecosystem of partners that complement your company’s strengths. Most importantly, as you work together to solve customers’ business challenges, you’ll become the new winners in the 21st century co-economy.
This article was originally published on Network World.