by Philip Boxer
How does an enterprise create and capture value when the demand tempo, the tempo at which the experiences of its clients need to change, is faster than the tempo at which it can integrate new capabilities within its own organization? This requires a relational strategy. The enterprise cannot expect to be able to satisfy on its own the selective pressure exerted by the client’s expectations. Instead, it must collaborate with other enterprises with whose capabilities it must be able to interoperate at a tempo that is determined by the client’s demand tempo, and with whom it forms a supply-side ecosystem.
Digitalization is not only driving accelerating demand tempos. It is also leading to relational strategies becoming necessary even for a single enterprise, to the extent that parts of the enterprise become equally subject to these demand-side selective pressures. Adaptation to these new kinds of competitive environment leads to the enterprise itself becoming a collaboration amongst its former component parts which themselves become managerially and operationally independent entities – a supply-side ecosystem –each entity competing in its own right as well as part of the enterprise as a collaboration.
This white paper assumes that any managerially and operationally independent enterprise is a living system that must sustain a competitive balance between its supply-side and its demand side. A relational strategy enables an enterprise may sustain this balance under conditions of demand tempo accelerating beyond its own ability to integrate new capabilities. This is in contrast to a positional strategy in which the demand side is replaced by a market with which it can sustain a one-sided relation. A relational architecture, then, is one that supports a relational strategy. It models the intelligence describing the forms of orchestration and synchronisation needed of its own and others’ capabilities, along with the know-how about the effective use of those capabilities and the relevant information and data on their necessary performance. This would include the necessary data on their effective delivery into and cohesion within a client’s environment in response to a client’s expectations. The paper uses two case examples to explore further the nature of the challenge inherent to developing these relational architectures.
 A living system (Rosen 1991) is one that sustains a dynamic operational closure between four distinct kinds of process:
- Selection of demand-side value created
- Repetition of a temporally isolating boundary
- Maintenance of its current form
- An enabling supply-side transformation
There are four distinct ways in which this dynamic operational closure may be held. These correspond to the four forms of competitive dominance within a business ecosystem characterized by their different strategy ceilings. These parallel the four to be found within a biological ecosystem (Kineman 2018).
Rosen, R. 1991. Life Itself (Columbia University Press: New York).
Kineman, John J. 2018. ‘Four Kinds of Anticipatory (M-R) Life and a Definition of Sustainability.’ in R. Poli (ed.), Handbook of Anticipation (Springer Nature: Switzerland).