Originally posted on 3/5/2013
Continuing the 2013 ASAP Global Alliance Summit opening plenary’s theme of thinking outside the box, Steve Steinhilber
, vice president of emerging solutions ecosystems at Cisco and author of Strategic Alliances: Three Ways to Make Them Work
, began his presentation “The Revolution Will Be Collaborative: How Alliance Models Must Evolve to Compete in a Fast-Changing World” by warning the crowd that “my job [today] is to make you uncomfortable.”
Steinhilber spent the majority of his session imploring attendees to look out for disruption in their respective industries coming in many forms and figure out how to adapt your partner ecosystem accordingly.
“If you haven’t thought [about your partner portfolio] through a new lens [after my presentation], I haven’t done my job,” he said.
Steinhilber painted a short- and long-term business landscape that will see rapid change at a pace that will only increase with time.
“Hold onto your chair,” he said. “Significant value will be created and destroyed as technology and other things come together.”
Steinhilber walked through several industries with value chains that have been radically transformed by technology and other factors over the course of the new millennium, including radio, television, music, cell phones, and retail. The commonalities for the old players that used to rule those industries: they had built strong links and partner ecosystems for their old model, but those strengths became weaknesses because they couldn’t adapt to disruption.
Every industry is either undergoing or will go through either a revolution or evolution in the next few years due to similar forces that took the aforementioned industries by storm—most notably technology, shifting demographics, new services models, deregulation, and growing influence of partnering.
“It is not necessary to change. Survival is not mandatory,” joked Steinhilber.
He walked through new products and services in automotive (smart cars), manufacturing (integrated digital plant floor systems), utilities (cloud-based energy management), health care (delivery of services to the home via technology), and financial services (capital markets delivery platform in NY, Toronto, and Tokyo) that illustrate the impact these forces are having.
Steinhhilber asked the audience to look at their current partner ecosystems in the following lenses: 1) Can I reimagine where the changes are coming from, and can I reengineer my model around that change? 2) How do I build new value chains?
More specifically, Steinhilber laid out five broad areas of each industry’s partner value chain: R&D, manufacturing, marketing, sales, and support. He urged the audience to answer questions such as are the players along this chain staying the same in five years? Who might be the new players Where do I play in this chain? Where can I use partners to create new control points?
To the latter point, he illustrated five potential “control points” that could be the source of opportunity or disruption:
- Account control—control based on degree of customer influence by a partner
- Economic control—control of a significant amount of financial or business impact (e.g., Apple’s influence via iPhone, iPad, and other consumer products).
- Technology control—“If we can do something better than other players and it’s hard to do and it adds value [to the end customer], we create a control point,” said Steinhilber.
- Partner landscape control—creating an ecosystem in which others can’t afford not to be participate (Apple’s iPhone, iPad developer ecosystem)
- Services control—cloud-based models and others that deliver capabilities and services
The last control point is significant because companies can launch even greater value and create new market opportunities once they have deeply penetrated others’ operational model.
Not only should companies assess the changes in their industries as well as the potential new partners that could drive that change in your favor, they should also question whether they are good partners themselves.
“Am I a good date to other companies?” asked Steinhilber.
Steinhilber related Cisco’s experiences of initial resistance encountered by partners which thought these new partnering models would cut into their revenues. He urged audiences to understand their prospective partner’s value proposition and make them understand you are trying to grow the cake so everyone gets a bigger slice.
Steinhilber ended the presentation on a similar note to how he began it.
“Feel uncomfortable,” he urged.
Change is afoot, and it’s probably too close for comfort.