Business ecosystems are becoming increasingly complex. The ability of an organization to forecast and achieve growth and profitability in the complex business ecosystem is more than an art. Imagine how complex this would become for a new entrant in Hi technology industry. In the previous blogs we've seen how value networks can be used as an effective tool to model businesses, analyze, and define strategy. (We are not even talking about executing them! Will leave it to art for now!!!)
Complexity is not unique to business, several technologists and scientists (I've deliberately chosen to separate them) have traversed down the path and created techniques and tools to bust them. A business therefore isn’t so unique except that the factors are many and the dynamism of the factors themselves is uncontrollable. But if we can model an ideal business (assuming limited factors and controllable state) we can converge on strategies.
In this space one can consider some of the existing techniques/tools that have been used in several disciplines: defining a value network, using Shannon’s entropy to determine complexity of the ecosystem within which the business operates, using constraint theory to maximize revenue and growth KPI for organizations and of course use game theory (Stackleberg/Nash games) to model the dynamism in the business. There are several interesting articles I came across recently in this field and itching to apply them in real-life scenarios!
Is there a strategy problem out there for piloting these ideas?
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Sunil, having gone through many of these techniques in strategic analysis, I think the only way to see the efficacy is to start modeling it. Now the question is do we need to wait for a problem to appear or to see how it can be applied to current problems that we are facing. My approach has been to actually try to apply to whatever problems you have in hand and then evolve!
ReplyDeleteGood luck