1. “Digital Ecosystems”: The Next Frontier for SMEs and European Local Regional Clusters?
Krakow, 2-4 June 2005
EISCO’ 2005: i2010 (eEurope): New Horizons,
New Tasks for Local
and Regional Governments
Gérald Santucci
European Commission – DG Information Society and Media
Head of Unit “ICT for Enterprise Networking“

2. Towards a Global Dynamic Competition
More interrelations
More specialised resources
More R&D / innovation
Accessing to global value chain
Accessing to knowledge
How to reach the critical mass of resources?
Industrial District
Growth Node
Virtual Cluster
Business Ecosystem

3. Different Views to Ecosystem Metaphor
Biological Ecosystem
Tightly knit into a global continuum of energy and nutrients and organisms – the biosphere.
Dynamic, constantly remaking themselves, reacting to natural disturbances and to the competition among and between species.
Industrial Ecosystem
Frosch and Gallopoulos, 1989
To bring the principles of sustainable development into all kinds of industrial operations.
Economy as an Ecosystem
Rothschild, 1990.
The basic mechanisms of economic change are remarkably similar with those found in nature – main difference is speed.
Organisms and organisations are “nodes in networks of relationships”.
Social Ecosystem
Mitleton-Kelly, 2003.
Organisations are co-evolving within a social ecosystem.

4. J.F. Moore, 1993 & 1996 M. Iansiti and R. Levien, 2004
Business Ecosystem
J.F. Moore, 1993 & 1996
Customers, lead producers, competitors, other stakeholders.
“The keystone species” influence the co-evolutionary processes.
Interaction (within a business ecosystem); decentralised decision-making and self-organisation.
Core capabilities are exploited to produce the core product.
M. Iansiti and R. Levien, 2004
A large number of loosely interconnected participants who depend on each other for their mutual effectiveness and survival.
Fragmentation, interconnectedness, co-operation, competition.
Three critical success factors: Productivity; Robustness; Nice creation.
Four different roles: Keystones; Niche players; Dominators; Hub landlords.
T. Power and G. Jerjian, 2001
A system of websites (“organisms”) occupying the World Wide Web (habitat”), together with those aspects of the real world with which they interact.
Becoming a networked business = changing everything that the company does.
Four stakeholders: communities of shareholders; employees; businesses; customers.

5. Inter-organisational and Collective Strategies in SMEs
Astley & Fombrun, 1983:
“Collective strategy is a systematic response by a set of organisations that collaborate in order to absorb the variation present in their environment”
Gueguen & Pellegrin-Boucher, 2004
Dialectics of competition strategies vs. co-operation strategies
Co-evolution: more co-operation yet maintaining a high level of competition
Co-operation and competition are embedded in the “culture” of business ecosystems

6. A New Concept to Understand Today’s Business “Collective Strategies”
Complex
interactions D E P N I G
Business ecosystems
Game theory
Multipoint/multi-market competition
Simple
interactions
Pure & perfect competition
Homogeneous actors
Imperfect competition
Heterogeneous actors
ENLARGEMENT

7. Increased complexity in
Business Networking

8. Digital Ecosystem: the Vision
An approach promoted by DG INFSO-D/5
A “digital environment” populated by “digital species”
software components, applications, services, knowledge, business models, training modules, contractual frameworks, laws, etc.
The environment enables species to behave like species in the natural world
Interact
Express an independent behaviour
Evolve – or become extinct – following laws of market selection

9. Digital Ecosystem: the Strategy
Growth
Competitiveness, market & internal
efficiency
Co-operation &
innovation networks
improve
lead to
encourage
provide
resources
A commercial environment where s/w developers, service providers and service users can trade profitably and competitively on a new ‘Common Land’
ICTs
catalyse
improve
“Digital Ecosystem Infrastructure”
Open Source
Evolutionary infrastructure
make viable
shape & foster
supports
support
Biology
enhances
New organisational
& business models
Policy
supports
Economic growth in the knowledge based economy requires a broad deployment and use of ICT by enterprises and public institutions

10. The Key Actors: SMEs
19 million enterprises in Europe
99.7% are SMEs, 93% are micro (< 10
employees)
ICT skills usually from outsiders
Providing SMEs with customised ICT applications & services for improving their efficiency (through process and organisational integration) and for extending their business beyond local barriers

11. The Key Actors: ICT-related Organisations
System integrators
Service providers
Software component developers
Open source communities
Open systems developers
Enabling these organisations to keep and preserve their knowledge and the possibility to develop/integrate ICT-based applications

12. The Key Actors: Regions
From traditional rural economy to e-economy
Connectivity  high-speed fibre-optic telecom network; wireless in areas where cable is uneconomic
Digital literacy  ICT-enabled social and entrepreneurial activities
Promoting regional economic growth, competitiveness and employment
Rejuvenating industrial areas through adoption of distributed, networked and open systems
Networking of SMEs and experimenting with new services and new business models
Synergies with the Structural Funds

13. Digital Ecosystem and Regions
Support of regional research-driven clusters
associating universities, research centres, enterprises and regional authorities
Technical
Infrastructure
Governance
&
Industrial
Policy
Human Capital,
Knowledge &
Practices
Legal Framework
& Financial
Conditions

14. Digital Ecosystem: the General Architecture

15. Digital Ecosystem: the General Architecture
Knowledge-Based Economy
DBE
Business Ecosystems and Regional Economies
Socio-economic
knowledge
Basic Models and Services
Digital Ecosystem Structure
Digital Ecosystem
Open-source service-oriented architecture
Network Infrastructure
Semantics of
services
Syntax of economic
behaviour
Business rules,
Regulatory Framework
Formalisation of
Knowledge
(F.Languages)

16. Looking Ahead IST-FP6 Call 5 “ICT for Networked Businesses” IST in FP7
Digital business ecosystems for SMEs
Open-source distributed self-adaptive environment and models enabling SMEs to co-operate for design, development of flexible and adaptable components interoperable with proprietary systems
Support of spontaneous composition, sharing distribution of business solutions and knowledge
IST in FP7
Technology Pillar “Software, Grids, security and dependability”
Application Pole “ICT supporting business and industry”
New forms of dynamic networked co-operative business processes, digital ecosystems
i2010
Take-up of ICT  an integrated policy on e-business giving special attention to SMEs

17. i2010 – What is different from eEurope?
Convincing evidence of the positive effects of ICT
e.g. SMEs to take up ICT, and more investment in R&D
ICT world is more mature and global => from a pilot phase to wide deployment
Covers the whole chain of EU Information Society and Media policies
Regulation, research and deployment
Emphasis on convergence, networking, content, public services and quality of life
New ways to implement
* This action plan will succeed the eEurope2002 action plan endorsed by the Feira European Council in June eEurope 2002 is part of the Lisbon strategy to make the European Union the most competitive and dynamic knowledge based economy with improved employment and social cohesion by 2010.

18. Conclusions
The business environment tends to become truly “knowledge-centric” instead of “document-centric”
Clustering/networking of SMEs, CRM and SCM solutions
Business performance of SMEs throughout lifecycle
Effecting collaborative content/knowledge creation
Increasing the effectiveness of SMEs’ valuable business asset – knowledge
Digital Business Ecosystem to become the Internet’s new ‘Common Land’
Knowledge is a ‘good’ augmented by its use and consumption
Like the Internet itself, no one owns or controls knowledge
The open road to the Lisbon goals through i2010