Orchestration is the most desired role, but also the riskiest
For the majority of companies, taking on the role of solution orchestrator is the most tempting. Orchestrators exercise the greatest control over the evolution of a solution. They take on a strategic role in the eyes of the end customer and create closer relationships with top decision makers than do completers or complementors. To orchestrate solutions successfully, however, requires significant investment and a broad set of competencies. Selecting the wrong solution or underestimating the effort required to bring it to market can waste resources and undermine revenue growth. The combination of investment requirements and uncertainty makes orchestration the riskiest role.
A different role in the solution stack may be a better option if your company lacks the resources to build the solution and lead the go-to-market efforts. Another reason to forego the lead role is if your products or services make up a relatively small part of a larger purchase. That is, the value you can bring to customers in a particular solution area is relatively small. If the customer’s buying process centers on another category of product, you will need to determine how your offering relates to the one that is central in the customer’s view. Once you understand the role your product plays within the broader solution from your customer’s point of view, you’re ready to pursue partnerships that will allow you to profit from the opportunity.
The communications sector is experiencing a major shift in the role that various ecosystem members play in solutions. Communication services providers (CSPs) are orchestrating packages of voice, data, and entertainment services to create solutions that meet the needs of many diverse customer segments. Such solutions may include core network infrastructure and applications from the primary CSP; bandwidth leased from other CSPs; devices such as smart phones and tablets, routers, and set-top boxes from electronics manufacturers; and third-party content and applications.
Those content and application providers are taking on completer and complementor roles with great success. Without the content and a few killer apps, many communication solutions would have drastically lower value for both the customers and the orchestrators. The need for a constant stream of innovative content and services creates an opportunity for companies that otherwise would never have been able to gain a foothold in the highly complex, consolidated, and capital-intensive communications industry.
The success of complementary products lies in the ability to create and manage strong partnerships. As with any partnership, determine where your product fits within the bigger picture, and be ready to articulate how your products or services enhance the value of the overall solution. The company orchestrating the solution is likely to have critical gaps in its own offerings. It is also looking to recruit a broad array of complementary product and service providers. The orchestrator is building an ecosystem. Your job in any of the other roles is to optimize your position within that ecosystem in order to maximize market reach, revenue, and profit.
You may need to share responsibility for integrating, selling, and supporting your product with the orchestrating vendor. Establish whether brand recognition is important to you for continued growth in this market. If so, you will need the partner to acknowledge that it has incorporated your product into its own. Select partners whose products are compatible and easy to integrate with, in order to avoid investments in design and development that cannot be reused for other relationships. If your product provides a critical capability that completes the orchestrator’s solution, you are likely to get less visibility, but also carry less responsibility for integration, support, and sales.
Competition for the richest feature set often turns complementary products into completers. In the communications market, functions such as video and location-based services were once considered nice-to-have complementary features. Just like voice mail or text messaging before them, such capabilities quickly became must-haves. The complementors that supply the next set of complementary technologies today will stand to benefit significantly as their role evolves to completer.