Extending the Ecosystem

We recently attended a key industry conference hosted by the research company InfoTrends, and it was interesting how often the phrase “ecosystem” came up. This was not related to the topic of saving or killing trees, although that is inherent in the discussion as well (save that item for a separate posting). This discussion was referring to the development of an imaging company’s offerings and support structures.  

The simple fact is that the imaging space has grown exponentially in its diversity and complexity, and will continue to do so. The results: regardless of the results reported in financial statements and anticipated outlooks, if the portfolio and support capabilities of any company do not map to key future user expectations, they will suffer in the short or the long term. And it is worth stressing again: any company can benefit or suffer, depending on how well they are meeting or missing expectations for document imaging.

Not only because of the economic situation (but that too), customers are more than ever aware of the great potential now available to optimize and control their document flows and improve their output cost structures. Statements about saving users 30% sound like a stab and a stretch. In fact, they are well documented and are actually conservative estimates.

But to meet these expectations, you have to deploy a sophisticated range of hardware, software and consulting skills. Any company which is not covering all the topics and skill sets will be highly exposed, and that is the “ecosystem” that needs to be cultivated. To address this situation, there are just a few alternatives for vendors:  

1)  Build a strong internal portfolio through organic development or acquisitions.

2)  Build a strong “virtual” portfolio through external partnerships.

3)  Watch your business and key business opportunities shrink - rapidly.

We can see prominent examples in each category, and each of these have obvious challenges to deal with:

• If you build our own portfolio, are you really expert enough in all of these diverse areas?  Can you maintain, manage and deploy all that internal expertise?
• If you collect partners, how do you coordinate and articulate your “virtual” offering and manage the necessary knowledge? We heard one vendor proudly state that they sell NO software, but are well positioned to sell embedded solutions. Noble (and maybe wise), but who knows and who says what your actual offering is? Case by case and in general?
• If you address only some market and volume segments, are you prepared for dwindling opportunities and possible survivability issues?

Point 3) is basically a red herring. Obviously, there is little or no alternative to offering a more complete portfolio.  Anybody expecting to thrive (or even survive) with a limited offering which addresses only part of the total market is seriously compromised.  These companies will have to be searching for partnerships, or they will become prime takeover targets.  We can think of a few in this category . . .