Senior Client Partner
Global Technology Market Advisory Leader
How Ecosystem Leadership is Transforming Tech
Faster business growth with fewer resources is possible—the secret is effective ecosystem leadership.
How Ecosystem Leadership is Transforming Tech
Tech CEOs are under increasing pressure to deliver greater growth. But traditional growth approaches—growing internally or growing through acquisition—no longer produce the desired results. In a rapidly changing world characterized by disruption and uncertainty, companies that achieve and surpass their growth goals all share one thing in common: executives with ecosystem leadership skills.
After an extended period of rapid growth, the technology industry is entering a new phase with weaker economic and consumer strength, stronger competitive and regulatory headwinds, and increasingly loud demands from investors for greater focus on sustainable and profitable growth. This new reality creates significant new challenges for tech CEOs. They’re suddenly being asked to show up in very different ways by their boards, their people and the communities in which they operate.
This business environment demands a new set of leadership skills. Companies need tech CEOs who will simultaneously run the business and change the business by looking beyond the company. They need leaders who can unlock growth through vertical and horizontal partnerships. They need ecosystem leaders.
Companies with ecosystem drivers as the dominant business model achieve higher margin growth than those focused primarily on their value chains. A business ecosystem is a network of organizations cooperating to deliver a product or service. These ecosystems may include customers, community, suppliers, distributors, competitors and more.
Sixty percent of tech CEOs say ecosystems are driving new customer interactions, sales and distribution channels. The field of play is changing dramatically. However, most CEOs are not equipped to lead in an ecosystem context. Only 15% of leaders possess the qualities needed to thrive in a disruptive business environment.
The business case for ecosystem leaders versus traditional tech executives is clear. But what is ecosystem leadership and how does it differ from enterprise leadership?
Traditionally, executives are absorbed by their company, their people and their problems. They don’t operate within a vacuum, but the company is their primary focus. Ecosystem leaders look beyond their company. They focus on shaping the broader business ecosystem in which their company operates.
In doing so, ecosystem leaders access capabilities they can’t develop themselves and tap into a new customer base they can’t reach independently. This gives their business coverage across the digital value chain while optimizing costs and mitigating the risk of resource overextension.
To succeed in this world, tech leaders need skills that go beyond the traditional demands of their position. They need to master a new technology leadership skill set.
For tech CEOs to transition successfully from leading a business unit or enterprise to an ecosystem, there are three interconnected phases of progression:
Effective ecosystem leaders create a compelling vision for the future that serves as a rallying cry to attract, motivate and retain employees as well as external partners, collaborators and investors. They harness their influential power to build and strengthen partnerships within the tech industry and beyond, inspiring stakeholders at other companies to share their vision for what’s possible together. And they sustain momentum amongst competing priorities by thinking and acting with agility.
The three phases of ecosystem leadership progression are reliant on one another. This means you must successfully accomplish each phase for the other to thrive. Without strategic thinking and vision, it would be difficult to influence a diverse group of stakeholders within a thriving ecosystem that benefits all. And without agility, this ecosystem would collapse.
The winning organizations in the next evolution of the technology industry will have leaders who can outperform competitors in their commercial, product and operational ecosystem.
If your organization wants to thrive through disruption, it needs more than sophisticated executive leaders. It needs ecosystem leaders who know how and when to perform and transform in today’s complex world.
As the catalyst of your organization, you can empower your teams to initiate the transformation from a walled garden to a dynamic, interconnected ecosystem. The challenge will be identifying how to properly navigate this seismic shift as you attract, engage and develop talent with the right ecosystem leadership capabilities.
Contact Korn Ferry today to learn more about how our consultants can help you hire, develop and retain ecosystem leaders.