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    Better together: How hybrid by design fuels your ecosystem engine

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      • This is the fourth in a series of reports on how to design and implement your organization’s “Great Tech Reset”, using a method we call hybrid by design. In this installment: how hybrid by design can help you design cloud-supported, gen-AI-fueled ecosystems.
    This is the fourth in a series of reports on how to design and implement your organization’s “Great Tech Reset”, using a method we call hybrid by design. In this installment: how hybrid by design can help you design cloud-supported, gen-AI-fueled ecosystems.
    This is the fourth in a series of reports on how to design and implement your organization’s “Great Tech Reset”, using a method we call hybrid by design. In this installment: how hybrid by design can help you design cloud-supported, gen-AI-fueled ecosystems.
    Strength in partnership

    By 2026, 40% of total revenue for the largest 2,000 organizations globally will be generated by digital products, services, and experiences. Are we seeing the last vestiges of analog? It’s looking like it. Sure, we still need sleep, sustenance, and oxygen, but beyond corporeal necessities, much of our world is going digital.

    This digital gold rush isn’t just about going online—it’s about a fundamental shift in how businesses interact and innovate. Forget lengthy product development and innovation cycles. Today, organizations must be agile, adaptable, and willing to take risks to stay ahead of the curve. Speed, experimentation, and iteration rule the day. Gone are the days of isolated competition. The coming era will also be defined by collaboration, with enterprises forging alliances and building robust ecosystems to deliver the most comprehensive digital experiences.

    It has become a “my ecosystem is better than your ecosystem” competitive environment. Imagine car companies partnering with fitness trackers, or traditional retailers offering financial services—industry walls are dissolving as enterprises recognize the power of working together. This digital transformation will also empower new players, from cloud-based tech providers to cybersecurity experts.

    No company can go it alone in the digital age. Strategic partnerships, joint ventures, and collaborations with startups, developers, and industry leaders have become essential for success. They are so essential that 55% of business leaders say changing strategic priorities will require reconfiguring core partnerships. But this partnering imperative brings its own set of challenges, from intellectual property gray zones, to integration complexities, data-sharing dynamics, cultural change and alignment, joint governance, and shared innovation and investment.

    A hybrid-by-design approach can help with these challenges. It requires intentionally designing and integrating different components and relationships to create a system that’s greater than the sum of its parts. For instance, it could involve integrating different business models, such as subscription-based and pay-per-use, to create a more diverse and resilient revenue stream. In a hybrid-by-design model, organizations bring together different technologies, such as artificial intelligence and cloud computing, to create new and innovative solutions. The model fosters relationships between different types of organizations, such as startups and established companies, to promote collaboration and knowledge sharing.

    Overall, a hybrid-by-design approach to ecosystems can help create a more resilient, innovative, and adaptable system that’s better equipped to respond to the complexities and challenges of the modern world.

    New rules of engagement

    In this new world, organizations must possess a unique set of skills and competencies compared to what they needed even in the recent past. Today, they need a deep understanding of digital technologies and their applications, along with strong partnership-building skills. They need to be able to navigate the intricacies of collaborative work. And they need the capability to leverage data and analytics for everything from product development to reimagined customer engagement.

    It’s a Darwinian conundrum; as enterprises figure out the ins and outs of being digitally led, they also urgently need to partner successfully with other enterprises who are on a similar journey. Those that adapt, innovate, and partner effectively will thrive, learning “how to ecosystem” effectively. Deciding what strategic needs their ecosystem serves will guide how they choose partners, from skills, to industry expertise, and more.

      • Hybrid by design integrates multiple clouds, gen AI, and business environments from the outset, creating a unified, cohesive ecosystem. This approach helps organizations leapfrog the usual ecosystem hurdles in multiple ways:
      • Smash data siloes. Hybrid by design shatters the data silos that plague traditional ecosystems. Imagine seamless data exchange—no more wrestling with incompatible formats or clunky integrations. This unlocks powerful automation and application portability, letting your teams focus on innovation, not data wrangling.
      • Develop a single pane of glass. Managing a multicloud, AI-powered landscape can feel like juggling flaming chainsaws. Hybrid by design brings order to the madness. It offers a single pane of glass for managing all your cloud ecosystem environments. Complexity melts away, freeing up IT resources for strategic initiatives.
      • Bend, don’t break. Enterprise needs are like the weather—ever-changing. Hybrid by design builds in elasticity and resilience. Your systems across the ecosystem can dynamically scale up or down based on demand, ensuring high availability and minimizing downtime. It’s like having a built-in shock absorber for the unexpected.
      • Future-proof. The only constant is change, and hybrid by design embraces it. This approach keeps your infrastructure future-proof. As new cloud services, AI advancements, and disruptive innovations emerge, you’ll be ready to seamlessly integrate them into your thriving ecosystem. Imagine having a constantly evolving, best-in-class tech stack at your fingertips.
      • Hybrid by design is about being intentional, mixing elements together in a system better than the sum of its parts. Organizations typically have maintained traditional ecosystems that worked in a very physical world. But as we progress toward digital, the skills and resources an ecosystem provides must change as well. Critical areas such as software development, data science, AI, cloud, infrastructure, and cybersecurity are now vitally important when selecting the right partners.
    Hybrid by design means bringing new discernment to your ecosystem, designing for the best mix of partners in a digital-first environment.
    Our research identified three things every leader needs to know about using hybrid by design to supercharge ecosystems:
    1. Gen AI has blown up your ecosystem.
    2. Moonshot collaboration bets will decide industry titans.
    3. The innovation carpool lane needs guardrails.
    And three things every leader needs to do right now:
    1. Square your tech triangle.
    2. Don’t be a spectator. Make your move.
    3. Protect the innovation lane.
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      Originally published 19 August 2024

      1. Elevate
      What you need to know
      Gen AI has blown up your ecosystem

      Remember the cozy days of picking a handful of partners and riding that stable to digital nirvana? Despite high hopes, nirvana didn’t materialize. Generative AI just blew up that strategy. The enterprise cloud landgrab lit the ecosystem fire. And generative AI is pouring gasoline on it. The resulting inferno demands a complete rethink of how you build strategic partnerships.

      Why? Because gen AI is an innovation explosion. It’s the tech equivalent of reinventing the wheel—a fundamental shift that is redefining entire industries. More than two-thirds (69%) of organizations say they will get to open innovation with gen AI by 2025. But that’s not an easy road to travel. Thirty-eight percent of executives admit their organizations lack the in-house expertise to adopt generative AI for innovation.

      This disconnect is driving the Great Tech Reset, in which organizations are completely rethinking their IT estate. As part of that rethink, they’re scrambling to build new partner ecosystems specifically designed for the gen AI era. And the stakes could not be higher. The right partnerships can give enterprises a huge head start on capitalizing on the power of AI.

      Consider this: For CEOs in 2024, product and service innovation is the number one priority. They’ll have to partner differently to achieve this goal because no one organization has everything it needs in-house to accomplish digital innovation. More than half (56%) of executives say strategic partners were highly important or critical to the success of their more recent large-scale tech programs. And 74% say they select teams of strategic partners to execute most or even all of their tech programs. Seventy–one percent are planning to or are already building a gen AI large language model (LLM) with a strategic partner to sell as a service.

      Hybrid by design makes it mark
      Hybrid by design encourages experimentation and prototyping to test new ideas and solutions, which is especially helpful in a gen AI environment because ecosystems need to move fast. It allows organizations to iterate and refine their approaches to ecosystem engagement in a rapid, agile way.

      By involving stakeholders in the design process—a key element in a hybrid-by-design approach—organizations can build trust and foster collaboration. A sense of shared ownership and responsibility for the ecosystem makes a competitive difference.

      Because of the level of collaboration hybrid by design requires, it can help enterprises identify opportunities for innovation and entrepreneurship within their ecosystem.

      Moving outside of your comfort zone
      The bottom line: forget the comfort of your old partner circle. The gen AI era demands a dynamic, ever-evolving ecosystem brimming with the right expertise. Organizations that excel in ecosystem engagement—the ones significantly outperforming—are already reaping the rewards in revenue growth. They experienced 24% higher revenue growth over the past three years compared to other enterprises.

      Don’t get left behind. The gen AI revolution is here, and the right tech partner ecosystem is your passport to success.

        • Gen AI is changing the nature of ecosystems by disrupting value chains, enabling new entrants, fragmenting industries, fostering co-opetition, increasing interdependence, and raising regulatory and ethical challenges. As ecosystems evolve with gen AI, here’s what you can expect.
        • Value chain disruption. Gen AI is reconfiguring value chains by enabling new business models, such as AI-as-a-service, and disrupting traditional relationships between suppliers, manufacturers, customers, and constituents. This forces ecosystem players to adapt and reposition themselves to remain relevant. For example, a coffee retailer buys beans from a roaster, who sources from a farm. Enter a company offering an AI-as-a-service platform for customized coffee blends and roasts. The retailer bypasses the traditional roaster and manufacturer, ordering directly from the farm. The farm gains direct access to customers and optimizes production and pricing. The roaster, no longer needed, must adapt by offering additional services. The traditional value chain is disrupted, with relationships reconfigured. The retailer gains control over blends and roasts, allowing for customization and quality. The farm benefits from direct access and increased revenue, while the roaster must adapt to remain relevant.
        • Fragmentation. Niche ecosystems emerge within larger industries, as organizations focus on specific applications or use cases. This fragmentation leads to new opportunities for specialization and collaboration, but also increases complexity and the need for interoperability. For instance, in healthcare, AI diagnostic platforms optimize services for specific patient populations, such as cancer or pediatric patients, improving accuracy and efficiency. Niche ecosystems emerge, each focused on a specific application or use case.
        • Co-opetition and partnerships. Gen AI is fostering co-opetition, where enterprises collaborate on AI development while competing in other areas. This leads to new partnerships, joint ventures, and strategic alliances, which can drive innovation and growth. For example, an autonomous driving platform could bring together leading automakers, Tier 1 suppliers, and startups to co-create a comprehensive autonomous driving ecosystem.
        • Interdependence. Ecosystem players are more dependent on each other than ever, relying on partners in newer areas like data and AI-fueled analytics. This interdependence can lead to new opportunities for collaboration, but also increases risk. In the digital healthcare ecosystem, a medical device manufacturer relies on a data analytics company to provide insights on patient data. Meanwhile, the analytics company relies on the device manufacturer to provide accurate and high-quality data. This interdependence creates a mutually beneficial relationship, allowing both companies to improve their products and services. For instance, the device manufacturer can use the analytics company’s insights to develop more effective treatments, while the analytics company can use the device manufacturer’s data to refine their algorithms. But, if the medical device manufacturer fails to provide accurate and high-quality data, the analytics company’s insights may be compromised, leading to inaccurate diagnoses or ineffective treatments. And if the analytics company’s algorithms are not robust enough to handle the complexity of the data, the device manufacturer’s products may not be optimized for effective treatment.
        • Regulatory and ethical challenges. Gen AI raises new regulatory and ethical concerns, such as data privacy, bias, and accountability. Ecosystem players must work together to establish standards, guidelines, and best practices to help ensure responsible AI development and deployment.
      Organizations that excel in ecosystem engagement experienced 24% higher revenue growth over the past three years compared to other enterprises.
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      What you need to do

      Square your tech triangle

      High-ROI tech programs—especially those driven by gen AI—demand a collaborative ecosystem of tech providers. The hybrid-by-design tech architecture framework defines the capabilities required to deliver the program and the role each tech provider plays.

      Hybrid by design focuses on a crucial trio: programs driving business results, the architecture to build and integrate them, and the operating model to keep it all humming. This may sound complete, but it’s missing a crucial piece: a strategic partner ecosystem. Organizations need partners who are invested in their success, not just selling the latest shiny object. It’s time to stop managing vendors and start building partnerships for a future-proof, results-oriented enterprise. Here’s how to square your triangle and build a winning ecosystem:

          Move from procurement to partnership. Ditch the RFPs built on lowest-bidder logic. When you add partners for their digital capabilities, you tend to get what you pay for. Identify partners who understand your goals and can co-create solutions with a shared vision. Look for partners with a proven track record of integration and a willingness to share accountability for program delivery and business outcomes. And don’t discount existing partnerships that support current ways of operating that prove valuable.

          Make collaborative design the rule. Don’t treat your partners like afterthoughts; remember, in a hybrid-by-design model, they are deliberately woven together in a system greater than the sum of its parts. Integrate them into the design process from the very beginning. This fosters a shared understanding of the program objectives, the architecture needed to achieve them, and the operating model for ongoing success. A collaborative design process ensures everyone is rowing in the same direction.

          Replace service level agreements (SLAs) with SLAs + shared objectives and key results (OKRs). Forget outdated SLAs that solely focus on uptime. Establish a framework that combines SLAs with OKRs—it can revolutionize the way teams work together. This aligns everyone’s incentives toward achieving the desired business outcomes, not just maintaining the technology stack. Put another way, this approach shifts the focus from merely ensuring uptime. SLAs outline the service quality and performance expectations, while OKRs define the desired outcomes and measurable results. This collaborative framework fosters a culture of shared goals, increased accountability, and improved overall performance.

        It’s time to stop managing vendors and start building partnerships for a future-proof, results-oriented enterprise.
        2. Engage
        What you need to know
        Moonshot collaboration bets will decide industry titans

        The next wave of industry titans will be built on hyper-collaboration and will center on the big tech plays that have the boardroom abuzz. From gen AI to platforms, the biggest tech trends are no longer the sole domain of individual enterprises. They require a level of collaboration and cooperation that was previously unimaginable. The winners will be those who can bring together unlikely allies, former competitors, and industry outsiders to drive innovation and growth.

        Two patterns help drive this push within industries. First, organizations are no longer trying to be everything to everyone. Instead, they’re focusing on specific customer journey segments and teaming up with organizations that share their customer base. This laser-like focus is enabling them to deliver hyper-targeted experiences that were previously impossible.

        Second, the most forward-thinking organizations are using tech to bring industry partners together, leveraging collective expertise to redefine products, services, or entire categories of both. This level of collaboration is redefining the very fabric of industries and creating new opportunities for growth and innovation.

        For instance, a hybrid-by-design approach to education can integrate different educational platforms, such as online courses, degree programs, and apprenticeships, to create a more personalized and effective learning experience. This can improve student outcomes, increase accessibility, and reduce costs. Here are a few more examples of industry enterprises banding together for greater impact.

          • Banking customers are used to being able to do most of their banking on a smartphone. Embedded finance extends banking services to much broader parts of the customer’s journey through life: shopping, big expenses such as buying a car or buying a home, going to school, getting healthcare services, and so on. Instead of deciding to make a purchase and then thinking about how to pay for it later, embedded finance provides the customer with financing options directly at the point of purchase. Done well, this is good for the customer, the seller, and the bank.
          • Seventy percent of banking executives say that embedded finance is either core or complementary to their strategy. Consider the partnerships required to deliver this play. The bank and the seller, obviously, but also the key tech providers for both parties. Each seller (the online retailer, the healthcare clinic, the online university) must link their mobile app to the bank’s services, requiring tech partners from both the seller and the bank. The bank needs to build a platform that can handle transactions with the seller and customer. That platform is going to be built on cloud infrastructure, so a variety of cloud service providers will be involved.
          • There’s a great deal of value to be had, but there are a lot of moving parts and many parties that need to build, operate, and integrate digital products while collaborating across multiple organizational boundaries.
          • If you’ve been in a new car recently, especially in a fully electric vehicle, you’ve seen that cars have become computer screens on wheels. We’re far beyond synchronizing your mobile phone to the car’s navigation system. Today’s cars are running millions of lines of computer code. Software is making the car run better and scanning for maintenance problems, and it’s delivering an online experience to the driver and passengers. It’s alerting the driver to hazards. Most importantly, the car is consuming and generating streams of data, and the connected car play is about turning that data into business value.
          • The ecosystem of partners for connected cars is big and complex: the car manufacturer, tech partners that build and maintain the various software packages onboard the vehicle, companies that supply parts that connect to the car’s software-driven “central nervous system,” consumer electronics firms that build the big-screen dashboard, and so on. Since today’s cars are fully online with mobile and wifi communications, telecom providers have also become key partners.
          • Today the connected car ecosystem adds two additional industries: energy and insurance. Energy companies have an interest in providing the charging stations for electric vehicles and providing (through their own partners) the applications for billing the car owner for each charge. And of course they have an interest in the EV charging data, as does the car manufacturer.
          • Insurance companies have been building smartphone applications that can sense how the car is being driven. Cautious drivers will get better insurance rates than speedy, aggressive drivers. And insurance companies are anticipating the day when fewer people buy cars and more consume “mobility services.” What does car insurance look like in a world where drivers pay by the minute for the use of a car, or when the car drives itself?
          • Connected cars are linked through software and data. Every player in the connected car ecosystem is in the digital products business and must find ways to connect data and applications with the other players. Cars have been so thoroughly reimagined by software and data that car execs predict that soon they will outsource the work of building vehicles (to more partners) and focus on the digital elements of the mobility industry.
          • Industrial manufacturing has been a hotbed of digital innovation in recent years. The Internet of Things (IoT) embeds manufactured products with tags and sensors that turn every product into a source of data. Factory floors have been reinvented with robotics and with predictive analytics, making manufacturing the leading edge of machine learning in a broad trend toward “Industry 4.0” and a growing ecosystem to support it.
          • Digital twin technology is a big digital bet that creates a virtual replica of a physical thing or a physical system. Digital twins can simulate something you’re trying to make (an airplane engine) or something you’re making to make something else (the robots on a factory floor). Using digital twins to design and manufacture products permits rapid design experimentation and permits the simulation and analysis required to optimize performance and predict product failures. This trend is crucial for reducing downtime and improving operational efficiency.
          • The partner ecosystem for digital twins features product manufacturers, companies big and small that build the digital twin software, companies that build the high-powered hardware the software requires, and specialty tech vendors that build systems for managing and processing the huge volumes of graphics data that create the digital twin.
          • Partnership ecosystems based on generative AI with hybrid cloud
            The common thread across industries is hybrid cloud. Every ecosystem partner in every example is building digital products or consuming data from a partner’s digital products. And those digital products are being built and operated on hybrid cloud architectures.
          • Platforms are another common thread. Each of these industry examples requires a shared space to access to each partner’s digital services and to exchange and manage the data flowing across the ecosystem. Those platforms make these partnerships possible, and they’re built on hybrid cloud.
          • Gen AI’s advanced machine learning capabilities can optimize and automate the management of hybrid cloud environments, ensuring seamless data exchange and integration across different systems and partners. This enables the efficient building and operation of digital products, as well as the secure and reliable exchange of data, ultimately facilitating successful partnerships and driving business growth.
        “Establishing a modern hybrid cloud architecture that enables easy access to data across the enterprise, the ability to leverage the potential of emerging technologies such as generative AI, and participation in a robust ecosystem of partners is paramount to a successful banking strategy in today’s industry.”
        Shanker Ramamurthy
        Global Managing Partner Banking & Financial Markets, IBM Consulting
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        What you need to do

        Don’t be a spectator. Make your move

        Hybrid cloud makes it possible for organizations to improve the customer’s experience by co-designing and co-operating digital products. The hybrid-by-design approach provides the common blueprint these boundary-spanning business partnership plays require.

        Forget the solo act—the future of innovation is a synchronized group effort. Here’s how senior executives can lead the charge in forging powerful partnerships that could redefine entire categories, using hybrid by design to power up partnering:

            Empower your corporate venturers. Don’t leave this critical task to chance. Charter your corporate ventures team to actively identify and engage potential partners who share your vision for disruption. Develop a robust partner identification framework, leveraging data analytics and market research to pinpoint potential partners that align with your vision. Regularly review and refine your partner engagement strategy to ensure it remains effective and efficient.

            Put out the welcome mat. Forget RFPs if you want true innovation. Traditional bidding processes stifle creativity. Host joint “Customer Journey Deep Dive” workshops with potential partners. Explore shared customer segments and unearth hidden opportunities for co-creation. By departing from traditional RFPs, you’ll unlock a more agile and iterative approach to innovation. Joint workshops allow you to use design thinking principles to immerse yourself in the daily struggles and triumphs of your target audience. This experience will enable you to identify unmet needs, uncover hidden pain points, and develop solutions that resonate deeply with your customers and constituents.

            Build a shared data swim lane. Establish a secure data-sharing environment (anonymized if needed) with potential partners. Leverage AI to analyze combined customer data, uncovering hidden affinities and purchase patterns across segments. This not only identifies lucrative co-marketing opportunities, but also paves the way for high-impact joint ventures. Think niche product bundles, targeted loyalty programs, or even entirely new service offerings catering to these previously unseen customer sweet spots.

          Organizations that excel in ecosystem engagement—the ones significantly outperforming—experienced 24% higher revenue growth over the past three years compared to other enterprises.
          3. Empower
          What you need to know
          The innovation carpool lane needs guardrails

          Today’s tech landscape demands a fast lane for innovation—a high-speed ecosystem where your organization, partners, and regulators cruise toward groundbreaking advancements. But ecosystems need clear standards and governance to truly accelerate.

          With the transformative potential and inherent risks of generative AI, the days of “figure it out as we go” simply won’t cut it. Although 75% of CEOs surveyed say trusted AI is impossible without effective AI governance in their organization, only 39% say they have good generative AI governance in place.

          Here’s why standards and governance are the unsung heroes that will speed your ecosystem journey:

          Going further, faster, together
          Imagine a highway where everyone makes their own rules. Chaos, right? Ecosystems are no different. When partners, vendors, and regulators all operate under a shared set of principles, collaboration takes flight. Streamlined processes, clear expectations, and a common understanding of risks allow everyone to move faster and achieve more impactful results.

          Taming the gen AI frontier
          Almost eight out of 10 executives (78%) say they collaborate extensively with their ecosystem partners on gen AI. But gen AI innovation can’t happen safely—and frankly, well—without gen-AI-specific governance. And even though 76% of organizations are already establishing policies and processes for gen AI governance, it doesn’t necessarily translate to their ecosystem.

          For instance, even if your organization’s enterprise governance structure is in place, it won’t help you with ecosystem partners who may not follow the same rules. Gen AI is a powerful frontier. But with great power comes great responsibility. Unfettered gen AI development could unleash biases, privacy breaches, and even existential threats. Here’s where gen-AI-specific governance steps in. It’s not enough to rely on your existing enterprise governance structure. Your ecosystem partners might have vastly different policies, creating a regulatory patchwork that could stall innovation. Robust gen AI governance sets clear boundaries and ethical frameworks, ensuring a safe and responsible path forward.

          Effective governance fosters transparency and accountability, laying the groundwork for strong, trusted partnerships essential for long-term success.

          Governance by design, not governance by disaster
          More than two-thirds of CEOs (68%) agree that governance for generative AI must be established as solutions are designed, rather than after they are deployed. This proactive approach is critical to ensuring that AI solutions are developed with safety, security, and ethics in mind. Embedding ethical considerations, risk mitigation strategies, and clear ownership structures into the development process ensures your gen AI solutions are not just innovative, but responsible from the get-go.

          Hybrid by design brings multiple perspectives for a more comprehensive safety net
          Creating guardrails and standards for ecosystems takes time and multiple perspectives. A hybrid-by-design approach allows partners to co-create in areas such as standards certification, enhancing potential adoption. Partners can also jointly develop training and capacity-building programs that help stakeholders to comply with ecosystem standards and guidelines. This helps ensure certification and accreditation programs are effective in promoting compliance and best practices.

          Implementing guardrails around a hybrid-by-design ecosystem is crucial for the ecosystem to operate effectively, efficiently, and responsibly. Let’s look at types of guardrails that can be put in place.

            • Transparency and accountability mechanisms. Implement mechanisms that ensure transparency and accountability within the ecosystem. This includes regular reporting, auditing, and monitoring of ecosystem activities.
            • Data protection and privacy safeguards. Implement robust data protection and privacy safeguards to ensure that ecosystem participants’ data is protected and used in accordance with their consent.
            • Security protocols. Establish robust security protocols to protect the ecosystem from cyber threats and ensure the integrity of ecosystem data and transactions.
            • Intellectual property (IP) protection. Implement mechanisms to protect intellectual property and ensure that ecosystem participant IP rights are respected.
            • Compliance with regulatory requirements. Ensure that the ecosystem complies with relevant regulatory requirements, such as anti-trust laws, competition laws, and industry-specific regulations.
            • Dispute resolution mechanisms. Establish dispute resolution mechanisms to resolve conflicts and disputes that may arise within the ecosystem.
            • Standards and interoperability guidelines. Develop and implement standards and interoperability guidelines to ensure that ecosystem participants can seamlessly interact and exchange data.
            • Code of conduct and ethics. Develop a code of conduct and ethics that outlines the expected behavior and values of ecosystem participants.
            • By implementing these guardrails, a hybrid-by-design ecosystem can operate in a responsible, efficient, and effective manner, while ensuring the trust and confidence of its participants.
          In the age of generative AI, with its transformative potential and inherent risks, the days of “figure it out as we go” simply won’t cut it.
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          What you need to do

          Protect the innovation lane

          Building a collaborative ecosystem with strong governance, open data practices, and a commitment to open standards can help you ensure a smooth and safe ride. As you do so, you’re collectively shaping the future of responsible generative AI innovation.

              Institute open data practices. By embracing open data practices in a hybrid-by-design model, enterprises can unlock new possibilities for growth, efficiency, and innovation. Combining diverse data sources not only creates a more comprehensive view, it allows developers to build upon existing data and accelerate innovation. Develop and implement data sharing agreements and protocols that ensure transparency, accountability, and trust. Implement secure, state-of-the-art data repositories to house this shared intelligence. But remember, security is a two-way street. Equip all data contributors with the knowledge and tools to share responsibly and ethically.

              Invite players from outside the walled garden. Convene a diverse group of stakeholders—a hybrid-by-design ecosystem views this deliberate, strategic diversity as an asset. Include not just your internal AI and data teams, but also key ecosystem partners, regulatory bodies, and even potential customers. This collaboration fosters a shared understanding of risks and opportunities, leading to robust and relevant governance frameworks. Take advantage of the diversity of thought by creating a “Red Team” within the ecosystem, composed of individuals from different enterprises, departments, and backgrounds to simulate potential AI-related risks and challenges, and develop strategies to mitigate them.

              Replace “set it and forget it” with timely tune-ups. In a hybrid-by-design ecosystem, diversity brings strength but it can also make governance more complex. Careful monitoring of everything from communication to engagement practices becomes even more essential to keep the ecosystem running smoothly. Regularly review and update your standards and governance frameworks to reflect evolving regulations, technological advancements, and industry best practices. Schedule regular reviews, not just annually, but also in response to major developments. These could be the emergence of groundbreaking new research, the implementation of new regulations (such as the EU AI Act), or even significant data breaches that expose vulnerabilities in existing frameworks. To ensure the group doesn’t fall into group-think, host a “reverse brainstorming” session. Gather a diverse group of stakeholders and ask them to identify the most creative ways to circumvent or manipulate your existing frameworks. This can help identify potential vulnerabilities and provide opportunities to strengthen your frameworks.

            Hybrid by design in action

              • Business challenge
                CVS Health executives wanted to transform their business but realized that in order to achieve this, they needed to understand and integrate their entire ecosystem. They took an “outside-in” perspective to understand the needs of the people they serve and what data would be required to drive the transformation. They would need to focus on application programming interfaces (APIs) as part of the plan, developing an API-centric strategy and API ecosystem with flexibility to accommodate different environments: on premises, private cloud, and various public clouds.
              • Transformation
                CVS Health CTO Claus Jensen helped to guide the company on a business transformation and hybrid cloud journey–one that started with reconsidering their entire approach to integration. The team took a holistic approach to hybrid cloud integration that included specialized skills, practices, patterns, and technology to reduce integration costs by two-thirds. They were able to integrate their entire ecosystem and be positioned to transform the way that CVS provides service to their clients and partners.
              • “We can literally build integration capabilities at about a third of the cost that we could four years ago.”
              • -Claus Jensen, CTO, CVS Health Corporation
            Let the power of hybrid by design power your ecosystem

            Gen AI has irrevocably changed the landscape of innovative ecosystems. To thrive, organizations must cultivate ecosystems that seamlessly blend the digital and physical worlds. This isn’t about mere coexistence; it’s about co-creation.

            Identify the right partners, build robust governance frameworks, and harness the power of hybrid-by-design architectures and principles. The rewards can be immense—a competitive edge in the digital age, the ability to develop groundbreaking AI solutions, and the chance to be at the forefront of shaping the responsible future of AI.


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            Additional content

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              Originally published 19 August 2024

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