goals of software vendors for their partner ecosystems

Copyright © 2010 Dr. Karl Popp

Goals of software vendors for partner ecosystems – a practitioner´s viewDr. Karl PoppCorporate DevelopmentSAP [email protected]://www.drkarlpopp.com


Background information

Business Models in the software industry

http://www.drkarlpopp.com/BusinessModelsintheSoftwareindustry.html

Profit from Software EcosystemsISBN-13: 978-3842300514Business Models, partnership models and ecosystems in the software industryExamples from over 50 software companies


Definitions

• An economic ecosystem is a set of companies that exchange products or services to serve a common goal or to achieve higher levels of individual goals.

• A software ecosystem is an economic ecosystem that forms around a software vendor


Software Ecosystem

AcquisitionAcquisitionTargets

System Integrators

CustomersSuppliersSoftware

vendor

SoftwarePartners

Open Source Comm.


Software Ecosystem

CustomersSoftware vendor

SoftwarePartners

Products,Assets orServices Payments

System Integrators

Open SourceComm.

Suppliers

AcquisitionAcquisitionTargets


SupplierEcosystem

EcosystemCustomerEcosystem

Partner Ecosystem

Types of Ecosystems

System Integrators


SoftwarePartnersAcquisitionAcquisition

Targets

Suppliers

Open Source Comm.

Focus of this presentation


Financial goals

• Monetize on the partner ecosystem– Increase existing or create new revenue

streams– E.g. by letting partners sell products or by

charging fees for certification• Save cost

– Lower cost of development, support, maintenance, education, marketing

– E.g. by outsourcing tasks to partners like support, maintenance, sales, training


Revenue streams (examples)


SoftwarePartners

Revenuestreams

Licenserevenues


Product related goals

• Strengthen market presence– Diversified partnership strategies for regional

and local markets• Strengthen software vendor´s offerings

– Partners fill whitespaces and provide complementing solutions

• Innovate and co-innovate solutions– A sound innovation strategy of a software

vendor contains a mix of internal and external innovation.


Network effect related goals

• Maximize ecosystem gravity– Hypothesis: increasing the number of

participants in the ecosystem attracts even more new members for the ecosystem.

• Maximize retention of participants in the ecosystem – Retention of participants in the ecosystem is

based on two important factors: incentives and lock-in.


Summary

• Software vendors define goals for their partner ecosystems

• Software vendors engage in win-win partnerships that create revenue and save cost

• Software vendors plan for and leverage network effects in partner ecosystems


Background information

Business Models in the software industry

http://www.drkarlpopp.com/BusinessModelsintheSoftwareindustry.html

Profit from Software EcosystemsISBN-13: 978-3842300514Business Models, partnership models and ecosystems in the software industryExamples from over 50 software companies


Video lessons

• Get your education online at mindbites.com:

• http://www.mindbites.com/lesson/13903-software-business-model-basics

• http://www.mindbites.com/lesson/13904-software-revenue-models