Once, total vertical integration was the goal. Today, outsourcing crucial elements of a company's production process has become the norm. In the future that outsourcing will be going more and more to smaller businesses.
Increasingly, small business will be able to do the same work as old Big Corp, and it will deliver higher quality for less cost. Big Corp will have a growing stake in the health of the smaller companies supplying it. Those small businesses in return will be invested in Big Corp's success.
If that's not an ecosystem, we don't know what is.
Impact:
- As industries become ecosystems rather than food chains, look for more technology sharing. Look for larger organizations to seek investment in the smaller businesses in their ecosystem. Because those small businesses will lack the heavy commitment to past ways of doing things, they'll be quicker to initiate new ideas and processes.
That means the hot action is likely to be with the small businesses supplying larger companies. They are likely to be the places where innovation finds a home first. But the ecosystem's larger companies will be the market makers.
To succeed you'll need to understand the dynamics of both large and small business and of something new -- the ecosystem they share.
