How are open and closed ecosystems alike

Digital ecosystems and platform economy: what is it and what are the opportunities?

The effects of digitization, digitization and digital transformation on the economy can be viewed in two dimensions (see Fig. 2). In the first dimension, the effects are aimed at optimizing efficiency and reducing costs. In this dimension, the German economy is absolutely world class. No one else is so good at making a process a bit faster, safer, better and cheaper. No one else is so good at improving the quality of a product a bit, reducing the gap size and making it more consistent. In this dimension, people like to move in very small steps and thus bring about an incremental innovation. The risk is manageable, as you can easily change something you already know. You can estimate both the effort and the expected benefit fairly well. The benefit achieved is not always directly noticeable by the consumer, as not all efficiency optimizations or cost reductions are passed on directly to the consumer.

In the second dimension it looks very different. This dimension is about creating new values ​​and bringing about radical innovation through digitization, digitization and, above all, digital transformation. It is always about new values ​​from the point of view of the consumer, who can therefore always perceive a new benefit. If you move in this dimension, you are mostly breaking new ground. Companies are trying something here that is at least completely new to them, even if it may have already been done by another company that may even come from a completely different domain. Or maybe no other company has ever tried. Thus, steps in this dimension are associated with much greater uncertainty. The effort required, but above all the benefits to be expected for consumers, is difficult to estimate. In addition, it is usually extremely unclear when the effort will also be financially worthwhile, if at all. The German economy in particular is therefore often reluctant to take such steps on this scale in the direction of radical innovation. For decades she has done very well simply continuously improving her existing products and services and creating variants over and over again.

In the coordinate system spanned by both dimensions, digital ecosystems are located in the "sweet spot", the optimal point at the top right (see Fig. 2). Digital ecosystems deliver huge added value for consumers, which mostly did not exist in this form before. But in order for them to generate this added value, they have to work extremely efficiently. Many of these digital ecosystems have completely changed their industry, especially with completely new digital business models, and thus have a significant impact on the entire economy. Streaming services like Spotify transformed the music industry, Netflix transformed the film industry, Airbnb transformed the hospitality industry, and Uber transformed passenger traffic. These are just a few examples, which unfortunately all come from the USA, but show the great opportunities digital ecosystems offer and why they should be dealt with.

What are digital ecosystems?

The well-known examples of digital ecosystems mentioned above give a first feeling for how strongly they differ from the well-known. However, the term "digital ecosystems" is currently being used in an increasingly inflationary manner. Not only do many seem to have their own definition of digital ecosystems, but mostly the term is used so abstractly that there seems to be no clear idea of ​​a definition at all. In order to make it easier to understand what distinguishes them and why they need your special attention, meaningful definitions of the term digital ecosystem and other closely related concepts are necessary. We therefore define the most important terms relating to digital ecosystems in the following.

Digital ecosystem

We understand a digital ecosystem to be a socio-technical system. This means that such an ecosystem not only includes digital, technical systems, but also explicitly includes organizations and people and their relationships with one another. Let's take the example of Flixbus, a digital ecosystem for long-distance passenger transport. In addition to various software and possibly hardware systems, for example for buying tickets or for tracking buses, it particularly includes passengers, bus companies and their drivers.

A characteristic of a digital ecosystem is that the organizations and people, hereinafter referred to as ecosystem participants, act independently of one another in their respective markets. Bus companies offer their own journeys, while passengers can choose from a wide variety of mobility offers from various providers. In a common digital ecosystem, these participants act on the basis of mutual benefit that arises from the joint collaboration in the ecosystem. There is no instance that could exert pressure or even force to force the participants to join or stay in the digital ecosystem. PassengersThose who are planning their trip are usually free to choose another mode of transport instead of taking a Flixbus; bus company can, within the framework of the concluded contracts, make the decision to (again) offer journeys under their own direction instead of traveling under the Flixbus flag. The initiator of the digital ecosystem, which defines the conditions for cooperation between the participants, can only create the framework conditions under which participation in the digital ecosystem is attractive for everyone.

Ecosystem service

Cooperation in a digital ecosystem is made possible and supported in the best possible way by an ecosystem service that the ecosystem initiator offers and whose rules he defines. The ecosystem service provides the basis for generating added value for the participants. The decisive factor here is that the ecosystem service in a digital ecosystem is provided completely digitally, which distinguishes digital ecosystems from traditional economic ecosystems, for example physical retail or wholesale. Flixbus' ecosystem service consists of arranging rides offered by bus companies for passengers. This mediation is done purely digitally. The participation in a bus trip resulting from the mediation takes place analogously in the real world. Here it also becomes clear that a digital ecosystem is initiated very consciously and purposefully: an ecosystem initiator recognizes a possible need and creates an ecosystem service, which he then offers to the participants for their cooperation.

The ecosystem service of a digital ecosystem always describes a relationship between the provider and the customer of a so-called asset, the provision and consumption of which links the two sides of the participant in the digital ecosystem with one another. Because of this connection in an ecosystem service, all ecosystem services can be characterized according to a fixed scheme. Airbnb Lodging offers the brokerage of private accommodation from private hosts to travelers (see Fig. 3). Ebay Marketplace offers the auction of all kinds of goods from sellers to buyers. About Ride offers the brokerage of travel offers from private drivers to passengers. Betterplace.org offers the mediation of donations from donors to aid organizations.