Harvard Business Review Press
August 1, 2004
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 battles 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 Wal-Mart, Microsoft, and Li & Fung deploy “keystone strategies” to actively shape and regulate the workings of their business ecosystems – dramatically improving their own performance and 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 ability, 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 ecosystems: 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 policymakers to understand, analyze, and successfully execute strategy in today’s networked environment.
Marco Iansiti is the David Sarnoff Professor of Business Administration at Harvard Business School and a cofounder of Keystone Strategy Inc., a consulting firm focused on strategy and innovation management. Roy Levien is a principal at Aldaron and founder of Keystone advantage LLC.