An exploratory study on the topic of business ecosystem with reference to the Hong Kong hotel sector

An exploratory study on the topic of business ecosystem with reference to the Hong Kong hotel sector [information from perplexity.ai] [This study is intended to prepare an MBA student to produce a preliminary dissertation proposal]

My question 1: "What is business ecosystem all about in strategic management?"

The reply: "In strategic management, a business ecosystem refers to a network of interconnected organizations, including suppliers, distributors, customers, competitors, and other stakeholders, that collaborate and compete to deliver specific products or services. This concept emphasizes the interdependence among these entities, where each affects and is affected by others, creating a dynamic and evolving environment similar to a biological ecosystem78.

1. : The ecosystem includes various organizations such as suppliers, distributors, customers, competitors, and government agencies78.

2. : Participants engage in both cooperative and competitive behaviors to create value for a common set of customers37.

3. : At least one entity acts as an orchestrator to manage the ecosystem's structure and performance, ensuring collective value creation9.

4. : The ecosystem aims to generate more value collectively than its members could individually310.

 involves designing and implementing comprehensive strategies to manage and optimize interactions within the ecosystem. This includes aligning stakeholder relationships with business goals to enhance competitive advantage and foster sustainable growth4.

• : Focuses on building mutually beneficial relationships to drive long-term growth and innovation1.

• : Essential for creating sustainable value and managing interdependencies14.

• : Companies must be flexible to adapt to changing market conditions and ecosystem dynamics7.

• : Ecosystems facilitate the creation of new products and services through collaborative efforts10.

• : Established ecosystems can create strong barriers for new competitors7.

• : Integration and collaboration can streamline operations and enhance scalability2.

In summary, a business ecosystem in strategic management is about leveraging collective potential through collaboration and competition to create sustainable value for all stakeholders involved."

My question 2: "What are the opportunities and challenges facing the Hong Kong Hotel sector from the perspective of the business ecosystem theory?"

The reply: "From the perspective of business ecosystem theory, the Hong Kong hotel sector faces both opportunities and challenges. Here's an analysis based on this framework:

1. : The sector is on a recovery trajectory following the full border reopening, with rising occupancy rates and average daily rates (ADR), especially for high-tariff hotels1. This recovery presents opportunities for hotels to regain market share and attract new customers.

2. : Hotels are innovating through collaborations with other brands to enhance guest experiences, such as unique dining experiences1. This collaborative approach aligns with the ecosystem concept of interdependent entities creating value together.

3. : Hotels are embracing sustainability, which can attract environmentally conscious travelers and enhance their brand reputation4. This aligns with broader ecosystem goals of sustainable development.

4. : There is significant interest in hotel transactions, with opportunities to reposition underperforming assets into co-living spaces or student accommodations23. This repositioning can help hotels adapt to changing market demands.

1. : The sector is heavily dependent on external factors like border reopenings and international travel restrictions2. This vulnerability can disrupt the ecosystem's stability.

2. : Until mainland borders fully reopen, hotels must compete aggressively for international visitors, which can be challenging2.

3. : Staffing issues and limited airline capacity can hinder the sector's recovery2. These operational challenges affect the ecosystem's overall efficiency.

4. : Hotels face regulatory pressures, such as restrictions on dining and gatherings, and environmental expectations to reduce waste and carbon emissions4. These pressures require hotels to adapt their operations and strategies within the ecosystem.

In summary, the Hong Kong hotel sector's opportunities and challenges reflect the dynamic nature of a business ecosystem, where entities must adapt to changing conditions, collaborate to innovate, and manage external dependencies to thrive."

My question 3: "What are the research gaps and issues on the business ecosystem theory?"

The reply: "Research on business ecosystems reveals several gaps and issues that need to be addressed. Here are some key challenges and gaps in the theory:

1. : There is a lack of clear methodologies for studying business ecosystems, including how to operationalize the concept of business ecosystem identity and how to select appropriate data sources and research methods15.

2. : There is a shortage of empirical studies on business ecosystems, particularly concerning their identity and dynamics over time1.

3. : The field lacks a comprehensive integration of various theories (e.g., cluster theory, resource dependence theory) into a cohesive framework for understanding business ecosystems37.

4. : Challenges exist in managing and orchestrating ecosystems due to limited control over independent partners, which can lead to issues in value capture and sustainability24.

1. : Ecosystems involve independent entities, making it difficult to enforce control or ensure consistent behavior among partners2.

2. : The distribution of value among ecosystem participants can be challenging, requiring significant investments to ensure the ecosystem remains attractive to contributors24.

3. : Most business ecosystems fail due to design flaws, insufficient problem-solving, or poor adaptation to changing conditions4.

4. : There is confusion about what constitutes a business ecosystem, often leading to myths about their nature and necessity6.

Addressing these gaps and issues is crucial for advancing the theory and practice of business ecosystems."

My question 4: "What are the business ecosystem-related issues in the Hong Kong hotel sector as reported in the public media?"

The reply: "Business ecosystem-related issues in the Hong Kong hotel sector, as reported in public media, include several challenges that affect the sector's recovery and sustainability. Here are some key issues:

1. :

   • : The introduction of a 3% lodging tax on hotel guests from January 1, 2025, adds an administrative burden and may deter visitors from extended stays, affecting hotel revenue13.

   • : The ban on single-use plastics requires hotels to adapt quickly, potentially increasing operational costs and affecting service standards3.

2. :

   • : The hotel industry faces significant staffing issues, with a 25% reduction in full-time staff over recent years. This shortage impacts service quality and operational efficiency36.

   • : Increased costs due to regulatory compliance and staffing challenges strain hotel operations35.

3. :

   • : The sector is heavily influenced by geopolitical tensions, economic conditions, and travel restrictions, which can disrupt tourism flows18.

   • : New hotel openings increase competition, while the sector's recovery is still underway25.

4. :

   • : Ongoing tensions, such as the US-China trade situation, can impact tourism and investor confidence18.

   • : High interest rates and economic uncertainty affect investor sentiment and hotel transactions78.

Despite these challenges, there are opportunities for growth:

• : Positive tourism trends and upcoming events are expected to boost occupancy rates and revenue24.

• : Conversions of hotels into alternative uses like student housing offer new revenue streams4.

Overall, the Hong Kong hotel sector faces a complex business ecosystem with both challenges and opportunities that require strategic management to navigate effectively."

My question 5: "What has been the theoretical development of the business ecosystem theory over the last 30 years?"

The reply: "Over the last 30 years, the theoretical development of business ecosystem theory has evolved significantly, building on the foundational work by James Moore in 1993. Here are key milestones and developments:

• : Moore introduced the concept of business ecosystems in his article "Predators and Prey: A New Ecology of Competition" in the Harvard Business Review. He applied the biological ecosystem model to the business world, emphasizing interdependence and co-evolution among organizations23.

• : Moore expanded his views, describing the business ecosystem as a dynamic structure involving various stakeholders, including suppliers, customers, competitors, and governments. He outlined stages of ecosystem development: generation, development, leadership, and self-renewal or extinction1.

• : Scholars identified key characteristics such as co-evolution, adaptability, self-organization, and emergence. The 4P3S framework was proposed to analyze ecosystems from aspects like people, place, product, process, structure, shareowner, and social environment1.

• : The application of complexity theory highlighted self-organization and co-evolution as essential features of business ecosystems. This perspective emphasizes the ability of ecosystems to adapt to changing conditions8.

• : Ecosystems were recognized as actionable constructs for strategy, focusing on value creation and capture among participants. This strategic view emphasizes collaboration and innovation within ecosystems5.

• : Research shifted towards understanding how to manage and govern ecosystems effectively, addressing challenges like value distribution and sustainability45.

• : The recognition that ecosystems can address complex adaptive problems through collaboration and innovation has become a central theme. This involves developing skills for guiding ecosystems towards better outcomes3.

• : There is a growing need for more empirical research to validate theoretical models and understand ecosystem dynamics in different contexts.

• : The impact of technologies like AI and blockchain on business ecosystems is an area of ongoing research, focusing on how these technologies can enhance ecosystem resilience and innovation.

Overall, the business ecosystem theory has evolved from a conceptual framework to a practical tool for strategic management, emphasizing collaboration, adaptability, and innovation in complex environments."

Reference: a collection of blog notes on using chatgpt for research purpose.