The Keystone Advantage: What the New Dynamics of Business Ecosystems Mean for Strategy, Innovation, and Sustainability

by Marco Iansiti, Roy Levien

Leveraging the power of business networks for success. Whether it sells computers, clothing, or cars, your firm's fate is increasingly linked to that of many other firms, all of which must collaborate effectively in order for each to thrive. This phenomenon has changed the basis of competition from battle between firms to battles between networks of firms--and more than ever before, success depends on managing assets your company doesn't own. In The Keystone Advantage , Marco Iansiti and Roy Levien offer a new lens for understanding how these ubiquitous and complex business networks behave and explore the implications for strategy formulation, innovation, and operations management. Iansiti and Levien argue that biological ecosystems provide a powerful analogy to the functioning of business networks. Just as "keystone species" in nature play central roles in their ecosystems, companies such as Walmart, Microsoft, and Li & Fung deploy "keystone strategies" to actively shape and regulate the workings of their business ecosystems--dramatically improving their own performance in the process. Iansiti and Levien argue that the best keystones simplify the challenge of connecting a very large and distributed network of companies to their customers and provide "platforms" that other firms can leverage to increase productivity, enhance stability, and spur innovation. Drawing from more than ten years of research and practical experience across a range of industries, the authors identify three specific roles that firms play within business keystone, dominator, and niche. The book lays out a framework any firm can use to assess the characteristics of its own ecosystem, reevaluate its technology and operations strategy, and formulate specific tactics for gaining sustainable competitive advantage. Practical and insightful, The Keystone Advantage will help leaders, managers, and policy makers to understand, analyze, and successful execute strategy in today’s networked environments.

Genres: Entrepreneurship, Business

304 pages, Hardcover

First published August 1, 2004

Reviews

[Grace · Rating 3 out of 5]

The value derived from this book depends on how mature your ecosystem is. If you're starting from scratch, the entire book is likely useful for developing principles on an open, balanced ecosystem. Otherwise, I'd just read Part I for the analogy between biological vs business ecosystems, Part II for cases on different ecosystem players, and Chapter 10 (Marketing Design, Operation, and Competition) on setting up operations for your market.

[Carter · Rating 4 out of 5]

The notion of the ecosystem, as a analogy, for business relationships, and networks; the problem, is much of the analysis, is lacking in key areas. The mathematics is unclear. There is evidently, a fair deal of data science, involved in constructing the models in the book. I suspect things will need to move beyond that. Recommended.

[Zane Davis · Rating 4 out of 5]

Skimmed aggressively, but still worthwhile.