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An Analysis of Dynamic
Strategies during the Lifecycle
of Software Ecosystems
Rodolfo Vasconcelos C. L. de Andrade
Carina Frota Alves
George Augusto Valença Santos

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• A set of interacting businesses that work as a unit
– Common goals
– Customer demands
– Customer base
– Shared costs, risks and knowledge
• A decentralized approach for software supply
activities
• Ecosystem Health: comprised by Productivity,
Niche Creation and Robustness.
• Roles: Keystone, Niche Player and Dominator.
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Software Ecosystems (SECOs)

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• Warren proposes a framework – Dynamic
Resource System View of Strategy (DRSV) -
to explore companies performance
throughout time adopting a visual
approach.
• He highlights the importance of company
resources as performance boosters.
• His proposal is highly concerned with
business sustainability (long-term
profitability). 3
Strategy Dynamics by Warren

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• A model that makes use of concepts from Business
Ecosystems as well as biological analogies to evaluate
ecosystem performance through SECO Health.
• The model focuses on strategic issues. DRSV serves as a
conceptual basis for the model.
– Sustainable advantage
– Strategy communication
– Dynamic and temporal
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The Dynamic Strategies for Software
Ecosystems (DS-SECO) model

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The DS-SECO model

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The phases of the DS-SECO model

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• Represent the performance of SECO health elements.
• Use ecosystem stages as time scale.
• Graphs should be reviewed at each iteration.
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Phase 1 - Time-Path Definition

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• Resources identification
– Main relevant resources for the SECO must be identified to form the
resources list
– Example: expertise on mobile development, capital availability, a solid
platform (provided by the keystone), etc.
• Resources flow analysis
– Identify key forces and exogenous items that influence resources flow.
• Example of key forces: investments, mutualism, etc.
• Exogenous items: biological concepts – emergence, competition, etc.
• How resources, key forces and exogenous items relate to each other in
terms of resources gain or losses?
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Phase 2 – Resources Identification and
Phase 3 – Resources Flow Analysis

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• Dynamic questions
– Based on time-paths and on resources flow analysis, the
three basic dynamic questions (why, where, how) shall be
answered for each health element.
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Phase 4 - Dynamic Questions

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• Strategy assessment
– Business model, orchestration techniques, demand
estimation, architectural issues, environmental analysis
– Based on the answers to dynamic questions.
– Changes in strategy may be needed to guarantee
sustainable performance
– The outcomes of changes will be reassessed in the next
iteration
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Phase 5 - Strategy Assessment

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• In the beginning of birth, strategic
definitions must be made
• The DS-SECO phases shall be
executed at the end of each stage
• During self-renewal, the phases
will be executed several times
• As a SECO leader, the keystone is
committed for model application 11
How to apply the model

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The iPhone SECO

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Self-renewal – main facts
• iOS 4 with multitasking support and iOS 5 with iCloud
• Android as a threatening competitor
• iPhone 4 as the “thinnest smartphone at that time”
• iPhone 4S

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Self-renewal
Phase 1 – time-path definition

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• Resources list
– Potential user base
– Capital
– Know-how on mobile market
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Self-renewal
Phase 2 – resources identification

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• Key Forces
– Investments on R&D
– Investments on marketing
– Mutualistic partnerships
– Market differentials on iPhone
– Customer loyalty
• Exogenous items
– Emergence
– Competition
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Self-renewal
Phase 3 – resources flow analysis

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• fo
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Self-renewal
Phase 4 – dynamic questions
Productivity Robustness Niche creation
Why
question
• Relevant launches led to high
productivity: iOS 4, iOS 5,
iPhone 4, iPhone 4S, iAD
• Application development was
highly active
• Despite competition,
iPhone still had a vast
potential user base;
• Mutualist partnerships
were strong among
SECO participants
• Hardware and software
improvements boosted niche
creation;
• The rising number of
downloads on Apple Store
also boosted niche creation;
• iPhone sales were motivating
Where
question
• New versions of iOS and
iPhone are expected for
defending against competition
• New applications are
expected at Apple Store
• Trend: productivity on the top
• Customer loyalty,
cooperations and capital
tend to provide the
SECO with very high
robustness.
• Users’ passion for iPhone
reinforces the potential
profitability of the SECO;
• Apple capacity to lead
innovations generates several
business opportunities
How
question
• Innovations on iPhone, iOS
and application development
must be maintained;
• iPhone superiority must
be sustained. The
Android SECO became
a real threat;
• The passion for iPhone
cannot wilt. For that,
investments on R&D and
marketing are paramount;
• The SECO needs to remain
attractive for niche players.

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• Apple managed to orchestrate the SECO efficiently
• Hardware and software improvements were crucial for the SECO
• People around the world remained passionate about iPhone
• Competition became a feared threat posed mainly by the Android SECO
• Sustaining the innovation pace and monitoring competition was
paramount so far and became mandatory
• iPhone value as unique cannot be lost
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Self-renewal
Phase 5 – strategy assessment

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• Contributions provided by this work
– Gathering SECO state-of-the-art and literature on Business Ecosystems for a
better understanding of SECOs
– Integration with topics from Management
– The proposal of the DS-SECO to address open problems in the business
perspective of SECOs
• Main limitations of this research
– The difficulties in obtaining data directly from Apple
– The model was not empirically validated
– The Mystrategy tool simulation was not explored
• Future work
– Empirical studies in several software domains
– Exploring deeply the simulation functionality of the Mystrategy tool
– Adding technical issues in addition to strategic ones to the DS-SECO model
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Conclusions

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“We think too much and feel too little. More than
machinery, we need humanity.
More than cleverness, we need kindness and gentleness”
Charles Chaplin