Identifying and solving key aspects of global payments friction via the 2022 Global Payment Survey
Accelerating Ecosystems and Payments Innovation
Digital wallet architectures enable payments to move swiftly, securely and seamlessly across business ecosystems, powering embedded payment capabilities fully within business enterprises that are creating their own ecosystems.
Business ecosystems are complex organisms. With almost any ecosystem, the value is greater than the sum of its parts. Whether it’s the value created through software ecosystems that provide new technology beyond the reach of any single entity, or business networks that extend from supply chain to technology partner to distribution channel to user communities, platform business models have evolved to support business ecosystems with a more productive set of processes for developing and commercializing new technologies across nearly every industry. Indeed, business ecosystems have become increasingly the way we get things done.
And while much of the value of today’s business ecosystems may be intangible, the performance of such an ecosystem is dependent on the very tangible movement of money within the ecosystem amongst independent entities. Integrating a payments platform within the technology stack of an ecosystem can enhance its operational efficiency, lower costs for its payers and payees, while promoting relationship strength with entities within the ecosystem by providing an improved user experience for each.
The concept of a business ecosystem actually dates back to a 1993 HBR article, “Predators and Prey: A New Ecology of Competition,” by James F. Moore, in which he opined “that a company be viewed not as a member of a single industry but as part of a business ecosystem that crosses a variety of industries. In a business ecosystem, companies co-evolve capabilities around a new innovation: they work cooperatively and competitively to support new products, satisfy customer needs, and eventually incorporate the next round of innovations.”
The internet, of course, accelerated that co-evolution, supporting new innovations and ushering in the era of ecosystems. To underscore just how central these ecosystems have become to the way we live and work, Apple and Microsoft have been trading places over the past few years as either the first or second most valuable company in the world with Alphabet, Inc. (Google) not far behind. Each is marked by a vast external developer ecosystem, major operating systems with multi-tenant platforms and extensive distribution channels. It’s a far cry from the 2-tier distribution PC channel of Microsoft powered IBM-compatible personal computers when Moore penned his article.
Like their counterparts in the natural world, business ecosystems continually evolve as do the business requirements of the disparate business entities within them. And just as the internet has been central to accelerating the economic growth of these new ecosystems, it has also played a central role in the digital transformation and emergence of fintech services that have driven major payments innovations from digital wallets to frictionless cross-border payments.
As business ecosystems evolve to incorporate new business models, new technologies and news relationships, both symbiotic and competitive, payments innovations are certain to evolve to meet those needs. And the ability to embed those capabilities fully within the architecture of business enterprises that are creating their own ecosystems will prove ever more important.
Digital wallet architectures are at the center of those capabilities as payments move evermore swiftly, securely and seamlessly across business ecosystems to every node within from partners and customers both corporate and personal, to organizational users, developers and the many forms of intermediaries and value-chain contributors, embedded in the myriad use cases defined by the developers and solution providers that accelerate the innovation, growth and value of these ecosystems on a daily basis.