Business Ecosystems – Overrated or a real opportunity for financial services providers?

A few years ago, the topic of “Business Ecosystems” seemed to be the panacea for financial services institutions – everything “HAD” to be or become an ecosystem. At least that was often my perception.

Now the yield curve is turning and the income from maturity transformation is bubbling up again – at least with good work in the treasury departments in the past … So, all over with the “ecosystem”? I hope not – and I don’t just mean that from my individual perspective, since I am researching this phenomenon.

In the following, I would like to explain a look at the phenomenon of Business Ecosystems that highlights opportunities for banks to leverage the “mindset” to be successful. I am convinced Business Ecosystems are “come to stay” – to say it with “Wir sind Helden”.

But first a small step back. After an initial hype on the topic, some disillusionment seems to have set in – “how many successful business ecosystems are out there already, I only know of failed castles of thought?” a banker asked me recently. Now, one cannot deny a certain amount of truth to this … many initiatives do not seem to develop the power that one had probably hoped for. Large initiatives, which represent “a business ecosystem”, which just let the revenues flow into the books, do not catch my eye, at least not when I look at the banking sector in the DACH region. But perhaps such an expectation does the business ecosystem an injustice (still). Allow me to attempt a classification.

What is a Business Ecosystem?

Even though various assessments of the phenomenon have been developed in recent years – by researchers and practitioners – I would like to stick to the central idea of Moore, who is considered the founder of the topic in management. In an article (Predators and Prey), which appeared in the Harvard Business Review in 1993, he describes that companies do not act alone, but create added value for customers in interaction with other actors in their environment (Moore, 1993). Adner (2006) has finally suggested that achieving the most complete service offering possible for end customers is the goal of business ecosystems. He proposes to understand a business ecosystem as a structure of different actors that are collaboratively involved in generating value for customers (Adner, 2017). Excitingly, Business Ecosystems are distinguished from other collaborative value creation structures in particular by a) having lower hierarchical control of individual actors over others (cf. supply chains) and b) having multilateral relationships of individual actors (multiple dependencies of actors in the creation of value(s)). They basically rank between market and hierarchy, if you will (cf. Jacobides, Cennamo and Gawer, 2018).

What drove the development?

Overall, in my view, two developments are responsible for the fact that Business Ecosystems have developed particularly in recent years – The demand from us end customers (1) and the technical fundamentals (2).

1) For us as end customers, it is increasingly natural to receive seamless services that do not stop at traditional industry boundaries. Large technology companies have shown us how “convenience” works and the question arises why it should not be the same for financial services.

2) Technological development enables the efficient networking of different actors. In the past, the interaction of different actors often required a lot of effort. Today, technical solutions such as APIs enable the efficient networking of different actors.

So why can a business ecosystem be exciting?

Especially in the financial services sector, the services demanded by the market are often complex (i.e., multi-layered). If, for example, I want to offer a “complete” service offering in the area of housing – property search, financing, property management, arranging care, additional services (my favorite example would be “green lawn-as-a-service”) and others, it becomes quite a portfolio that a financial services provider would have to offer on its own. The individual services also go far beyond the actual financial business. That in itself is neither bad nor good – it’s just that if I as a bank want to build up the competence here, it’s certainly expensive (and may not really make sense …). In a business ecosystem, the possibility is offered that even complex service offerings for the customer (“service offering as complete as possible”) are provided jointly by different players. Ultimately, I as the end customer thus receive an offer that I would not have received before (the entire “pie” becomes larger). Sometimes, the interaction of players who were not brought together before can even give rise to completely new offerings (keyword: “generativity” – or in other words: there is still cream on the cake).

What do I get out of a business ecosystem?

Now that’s an exciting question. When I started my research on this in 2021, this was precisely a hook – “Dennis, business ecosystems sound exciting, but what do I get out of it?” was a question I had already been asked before. Do I currently have the full answer here – unfortunately no, but what I currently know I’m happy to share here:

  • We could show that it is not only “economic” values (increase revenue/reduce costs) that organizations try to achieve through their engagement in Business Ecosystems. The main goal of companies is to generate capital. However, capital itself is a term that carries many different facets in its meaning. Economic capital is one facet. However, there are other facets as well, such as “brand capital” and “network capital.”

    Brand capital:
    By participating in a business ecosystem that includes one (or more) specific other players, some organizations aim to increase their own brand capital.

    Network capital:
    By participating in a business ecosystem, some organizations aim to get a closer connection with customers. Similarly, some actors aim to enable others to provide their services.
  • From the end customer’s point of view, business ecosystems can help make services much more convenient to obtain. Yes, it used to be common practice for me as an end customer to put together my own “package” of services – but computers used to be as big as a student apartment or two.

What does a path to the Business Ecosystem mean for me as a financial services provider?

Above all, it means that you have to be aware of what you can – and (above all) what you can’t do when you set out to build a business ecosystem. Some of you reading this will probably roll your eyes – yes, but it’s apparently not that clear. Far too often, when asked what role a financial services provider might play in a business ecosystem, the answer is: “Clearly, we have to be the orchestrator”. In other words, we have to be the one who pulls the strings together. If you ask critically, the answer to the question of “why” is often “because we have to”. Unfortunately, in my view, this is not really a good basis for building business ecosystems. A “because we can do the following” would be appropriate here – after all, I (as a financial service provider) must not only convince myself of my role, but also customers and partners in the business ecosystem.

Prahalad and Hamel coined the concept of core competencies back in the early 1990s (Prahalad and Hamel, 2009). There, they present the analysis of organizations on their core competencies in order to secure competitive advantages. Now it seems to me that a similar approach makes sense in terms of building Business Ecosystems. If I want to be an orchestrator, for example, I have to gain the acceptance of the entire network. Trust and be trusted to curate the Business Ecosystem. I also need funding to build it – because a Business Ecosystem certainly doesn’t happen overnight. I also have to find a way to occupy a niche with my business ecosystem that the end customers trust me to occupy. As a financial services provider, you can want everything, but you can probably only do part of it.

Some banking groups are more interested in building business ecosystems with a regional focus, others in being a global player for their customers’ needs, and others in focusing on asset management. Only a few financial service providers will probably be able to offer everything – and from my point of view, that is not a problem at all.

From my point of view, the path to a business ecosystem means first of all dealing with oneself, with one’s own strengths and weaknesses.

And now?

From my perspective, the concept of Business Ecosystems is really here to stay – and that’s a good thing. If you look at it a bit more soberly than perhaps in the past, there are enormous opportunities for financial services providers. However, it is important that the respective organizations are aware of their strengths and weaknesses. Not everything has to be a “business ecosystem” – it is a matter of finding out in each case whether it is a sensible concept or not.

The current generally improved earnings situation should not lead to a standstill in the development of their own business models. Rather, financial service providers should use the breathing space they have gained to start a systematic assessment of their own strengths and weaknesses, find their own role, strive to build a business ecosystem, and systematically start the corresponding development.


Adner, R. (2006) ‘Match Your Innovation Strategy to Your Innovation Ecosystem.’, Harvard Business Review, 84(4), pp. 98-107. Available at:

Adner, R. (2017) ‘Ecosystem as structure: an actionable construct for strategy’, Journal of Management, 43(1), p. 39. Available at:

Jacobides, M. G., Cennamo, C. and Gawer, A. (2018) ‘Towards a theory of ecosystems.’, Strategic Management Journal (John Wiley \& Sons, Inc.), 39(8), pp. 2255-2276. Available at:

Moore, J. F. (1993) ‘Predators and prey: a new ecology of competition.’, Harvard Business Review, 71(3), pp. 75-86.

Prahalad, C. K. and Hamel, G. (2009) ‘The core competence of the corporation’, Knowledge and Strategy, pp. 41-60. doi: 10.1016/b978-0-7506-7223-8.50003-4.

Dennis Vetterling

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