Dr. Samir Asaf and James Creelman
We all know we live in a business environment that is dynamic, unpredictable and increasingly complex, both internally and externally. No need to elaborate.
Despite being constantly, and often painfully reminded of these truisms, we are also struggling to figure how, to such a backdrop, we can deliver superior value to increasingly discerning and spoilt-for-choice customer. A 2014 research project by The Palladium Group, for example, involving a survey of 1300 firms from across the globe, found that 60% of firms believed that their customer value proposition was under threat. Furthermore, 81% were skeptical that their organization was capable of developing new products or services strong enough to overcome customer threats (1). It is reasonable to assume that five years on, little has changed.
The Dangers of an Internal Mindset
That little has changed has many Fathers, but one Alpha Male parent is likely the continued reliance on a purely internal view of how we think about delivering value to customers. A mindset that is typically transactional in nature – we do A (and decided by the same managerial process that has always identified A) and the customer buys and gets B. Everyone’s happy.
Unfortunately for such management teams, things just don’t work that way anymore,
Taking a Collaborative Approach
The most successful organizations today have long since moved on from such a value destroying way of thinking and have accepted that they in isolation cannot provide all the added value that customers demand. Embracing a truly solution-based approach, these firms are happily, and proactively, collaborating with others (including competitors – think coopetition) to deliver a more extended value portfolio to customers. Put simply, they have mastered the art of leveraging partner eco-systems.
Regardless of how dominant in the market, those that fail to master this art are increasingly paying a heavy price; and there’s already a long list of notable casualties. For example, why did Blackberry and Nokia, both once dominant, suffer near-extinction, whereas Apple was almost unimaginably successful?
Creating Dynamic Partner Eco-Systems
We argue that central to the answer is that Apple created a dynamic partner eco-system that was greatly valued by its customers. This included, among other things, the AppStore, that now holds more than two million apps. Customers don’t just buy the iPhone for its hardware but because of Apple’s digital eco-system, powered by its partners (and note, few Apple customers are aware of the members of the eco-system – or care!).
Additional examples of partner eco-systems include the Star Alliance in the airline industry, the SWIFT global payments system in financial services, the Sabre travel reservation system in the travel industry.
The Importance of “Sense and Respond”
But to be continually successful over time, such partner eco-systems need to be innovative, with the inbuilt ability to sense and respond to changing needs and expectations of partners and end-customers. Just as customer needs change quickly these days (and often suddenly), the same holds true for other stakeholders.
Often, such eco-systems become monolithic and lack the agility required to remain on the cutting edge. Partners lose interest as other and more exciting opportunities arise – perhaps another partner eco-system.
Leveraging Customer Touchpoints
What’s needed in today’s digital economy is dynamic partner eco-systems, powered by near real-time data capture, analysis, swift decision-making and execution. Key to success is wresting value from partner touchpoint.
Since key partner touchpoints are known as part of business processes, it should be relatively straightforward to determine how an organization or its partner eco-system is performing on each of these critical success factors, and so identify under-performing areas and take remedial action quickly. Moreover, partner contributions and their “ideas for action” can be captured and implemented to ensure that the eco-system remains relevant, healthy, and effective – and a win-win for all members of the system.
Partner Engagement Platforms
Thanks to recent advances in data science, cloud computing, cognitive analytics, and mobile computing, partner engagement software platforms are available (see www.performax360.com) that are helping organizations to reap the many benefits of a vibrant partner eco-system.
Organizations can now engage partners in a live and ongoing dialogue, receive regular and valuable feedback, and feed-forward processes to extract maximum value from partner eco-systems. As planning cycles shorten due to market dynamics and uncertainty, partner engagement software platforms facilitate outside-in, data-driven, and evidence-based decision-making at both strategic and operational levels.
In the financial services, for example, the unbundling of technology has enabled fintech companies such as Saxo Bank (Denmark) to create a highly scalable digital eco-system around its partners: this is supported by the platform core, technology, customers, and its brand. Innovation is enabled continuously through its open API platform, as Saxo Bank plays the role of the keystone organization in the eco-system.
To continue to deliver value to customers, organizations must leverage technology to remain connected to partners in real-time, both from a technology integration perspective and from a managerial communications perspective. Such collaborative relationships evolve through time, where value is co-created together with partners.
For firms to become truly collaborative, they must finally jettison the notion that all the answers to customer needs are found within the firm and, perhaps more challenging for many, the relinquishing of the deeply ingrained belief that they must keep partners/suppliers at arms-length and that competitors can never be trusted.
The digital age is also often called “the age of the customer.” We argue that it is also the “age of collaboration.”
- 2014 Global State of Strategy and Leadership Survey Report, James Creelman, Jade Evans, Caroline Lamaison, Matt Tice, Palladium Group.
Performax360 (www.performax360.com) is a real-time a real-time stakeholder engagement, collaboration, and business intelligence software solution that enables organizations to engage key stakeholders on critical issues. It automates stakeholder feedback capture, analytics, reporting, collaborative action planning, and action plan implementation monitoring.
With Performax360’s 3-step digital engagement process (discovery, analysis, and action), organizations can ensure that partners are engaged during the strategy development and strategy execution process and have a voice on critical issues relevant to the partner eco-system. Organizations can ensure “continuous touchpoints” with partners, so that it can maximize their contribution and participation in the eco-system strategy development and continuous refinement process. This helps with: (1) progressive steering of the strategy based on collective intelligence, (2) uncovering hidden risks based on grass-roots operational intelligence, and (3) collaborative innovation based on ongoing feedback capture.
In addition, Performax360 carries out partner sentiment analysis, powered by IBM Watson cognitive analytics, which allows management teams to gain an unprecedented level of insights into partner sentiment and emotions on all critical strategic and operational issues relevant to the organization and the partner eco-system. This analysis is carried out in real time, which contributes to partner eco-system agility and responsiveness. Finally, Performax360 supports collaborative action planning and action plan implementation monitoring, thus facilitating partner buy-in during the partner eco-system strategy execution process.
About the Authors
Dr. Samir Asaf is currently President and CEO of Performax Inc. Formerly, he held positions including Senior Advisor at the World Bank and Financial Director at AT&T Corp. and Group CEO at Rahimafrooz.
Author of ‘Executive Corporate Finance: the business of enhancing shareholder value’ (Financial Times Prentice Hall, London, 2004), he is currently a Board Leadership Fellow at the National Association of Corporate Directors (NACD), USA; and a Fellow and Chartered Director at the Institute of Directors (IOD), UK.
A graduate from Boston College with a BSc in Business Administration. He completed his Doctorate in Business Administration from SMC University; MSc in Economics from London School of Economics; Advanced Management Programme from Oxford University; Professional Certificate in Data Science and Enterprise Systems Engineering from MIT, and Graduate Certificate in Artificial Intelligence from Stanford University.
He is a Strategic Management Professional (ASP), Certified Customer Experience Professional (CXPA), Project Management Professional (PMI), and Kaplan-Norton BSC Certified Practitioner (Palladium); and Certified in the Governance of Enterprise IT (ISACA). He is a Business Excellence Assessor for EFQM and Malcolm Baldrige Frameworks, and a Certified Quality Auditor (ASQ); Certified in Digital Business Transformation from Boston Consulting Group (BCG); He was a research scholar in Finance and Strategy at the Harvard Business School (1998).
James Creelman provides expert guidance in strategy management to commercial and government organizations across the globe.
James’ main focus areas involve guiding leadership teams in the building and implementing of:
- Agile and Adaptive Balanced Scorecard Frameworks
- Integrated Strategy Formulation and Execution Approaches for the Digital Era
- Strategic Risk Management
- Strategy-Aligned Corporate Cultures.
The author of numerous books, articles and blogs, his most recent books include:
- Agile Strategy Management in the Digital Age: how dynamic balanced scorecards transform decision making, speed and effectiveness (Palgrave Macmillan, 2018). Co-authored with David Wiraeus.
- Doing More with Less: measuring, analyzing and improving performance in the government and not-for profit sector (Palgrave Macmillan, 2014). Co-authored with LinkedIn Influencer Bernard Marr.
- Risk-based Performance Management: integrating strategy and risk management (Palgrave Macmillan, 2013). Co-authored with Andrew Smart.