SAP AG: Orchestrating the Ecosystem

Marco   Iansiti; Karim R. Lakhani

Case | HBS Case Collection | April 2009

SAP AG: Orchestrating the Ecosystem

Abstract

Business ecosystems require careful orchestration and strategic choices regarding make/buy/partner decisions and membership access. This case examines the strategic and technological issues related to managing SAP's thriving ecosystem of user communities, software vendors, integration partners, and technology providers. It details how the ecosystem gets developed and the challenges in meeting the needs of the internal organization, large partners, and small up-and-coming firms. SAP executives, in this case, have to make a decision if a relatively small startup firm should be elevated to the highest strategic partnership level, normally reserved for very large firms.

Keywords: Decision Choices and Conditions; Organizational Structure; Partners and Partnerships; Business Strategy; Technology Industry;

Format: Print

20 pages

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Citation:

Iansiti, Marco, and Karim R. Lakhani. "SAP AG: Orchestrating the Ecosystem." Harvard Business School Case 609-069, April 2009.

Working Paper | HBS Working Paper Series | 2020

Design in the Age of Artificial Intelligence

Roberto Verganti, Luca Vendraminelli and Marco Iansiti

Artificial Intelligence (AI) is affecting the scenario in which innovation takes place. What are the implications for our understanding of design? Is AI just another digital technology that, akin to many others, will not significantly question what we know about design? Or will it create transformations in design that our current frameworks cannot capture?
To address these questions, we have investigated two pioneering cases at the frontier of AI, Netflix and AirBnB (complemented with analyses in Microsoft and Tesla), which offer a privileged window on the future evolution of design.
We found that AI does not undermine the basic principles of Design Thinking (people-centered, abductive and iterative). Rather, it enables to overcome past limitations (in scale, scope and learning) of human-intense design processes. In the context of AI factories solutions may even be more user-centered (to an extreme level of granularity, i.e. being designed for every single person), more creative, and continuously updated through learning iterations that span the entire life cycle of a product. Yet, we found that AI profoundly changes the practice of design. Problem solving tasks, traditionally carried on by designers, are now automated into learning loops that operate without limitations of volume and speed. These loops think in a radically different way than a designer: they address complex problems through very simple tasks, iterated exponentially. The article therefore proposes a new framework for understanding design practice in the age of AI. We also discuss the implications for design and innovation theory. Specifically, we observe that, as creative problem solving is significantly conducted by algorithms, human design increasingly becomes an activity of sense making, i.e. to understand which problems make sense to be addressed. This shift in focus calls for new theories and brings design closer to leadership, which is, inherently, an activity of sense making.

Keywords: artificial intelligence; design thinking; Technological Innovation; Design; Change; Theory;

Citation:

Verganti, Roberto, Luca Vendraminelli, and Marco Iansiti. "Design in the Age of Artificial Intelligence." Harvard Business School Working Paper, No. 20-091, February 2020. View Details

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SAP AG: Orchestrating the Ecosystem

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