Organizations are increasingly moving from unilateral relationships to networks of relationships. As a result, supplier-customer business models and the basis on which firms partner together is changing. This leads to a a new environment, one with a new set of rules and success factors. To ensure companies maintain a competitive edge, they need to adapt their business. This is concluded by the advisory firm BearingPoint in the report "Network Orchestration" which was published in cooperation with the Erasmus University.
From 'Control Relationships' to 'Orchestrated Networks'
According to the BearingPoint advisors, business partnerships are moving from 'Control Relationships' to 'Orchestrated Networks'. In the former, the supplier-customer relationship is the norm, short term individual gain is important and the world is dealt with in 1:1 relationships. In the latter, organizations work together in equal partner relations, gain sharing is important and the world is seen as a many-to-many network. The research shows that for firms to flourish in this new environment, a new set of rules and success factors apply.
Four pillars for network orchestration
The research results indicate that four main themes drive how well an organization is able to orchestrate. These are the pillars: strategy, processes, culture and IT. The report findings confirm that once the pillars are well in place, consulting firms realize better business performance and are more agile than their peers. "You have to align a network in such a way that is easy to add or remove people”, said Albert-Jan Schepers of BearingPoint. "There has to be a wish to work together. It has to be rooted in the organization. A silo-organization will have lots of difficulties with that. Furthermore, sharing and making information transparent is a must”.