May 4, 2022

The Advantage of the Ecosystem Innovation Flywheel

How can companies generate operational knowledge from the customer data they collect? The key to success is the Innovation Flywheel.

Hero image with the caption The Innovation Flywheel
Our new book Ecosystemize Your Business will be published end of this week.

One of our fundamental tenets is that almost all companies must consider how they can generate operational knowledge from the customer data they collect. The key to doing so is what we call the Innovation Flywheel.

The flywheel starts spinning faster and faster

Ecosystem design starts with taking a deep look at the mechanisms of ecosystem business models and the key aspect that is advantageous in comparison to traditional business models. That’s where the innovation flywheel comes into play.

How does the Innovation Flywheel work?

The better you solve customer/human needs, the more customers you acquire. More customers lead to more enriched data (and hence your knowledge) about the customer and better data allows you to create and adapt better solutions. Since ecosystems (or at least the Orchestrators of them) can collect more data through the power of the many customer touchpoints and offerings than a single company, they are in the pole position for new innovations. That’s when the flywheel starts spinning faster and faster.

Innovation Loop (Ecosystemizer)

Transfer on the B2B settings

The same principles apply to B2B companies. B2B players that operate in a system of marketplace (Orchestrator), vendor (Realizer) and background business (Enabler) normally take on the role of an Enabler. The main difference is that in an ecosystem an Enabling Orchestrator organizes the overall ecosystem. Moreover, the standalone B2B business does not receive data from customers/humans, but from companies and their outputs. More and more B2B companies are introduced in ecosystems with a holistic perspective including human needs (E2H) or at least they have to consider this for further development if the current focus is still core B2B.

If you are curious to learn more about this and additional details of ecosystem design, be sure to order your very own copy of Ecosystemize Your Business. Don’t delay. Pre-order your very own copy of our book today here.

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