Engineering Smart Ecosystems

Part I: Ecosystems

[This article originally appeared here on web11.org]

This is the first in a series of three articles that explain what ‘engineering smart ecosystems’ actually means. For to fully understand the Web11 movement one must have a proper understanding what we consider to be ecosystems, what it means for an ecosystem to be smart, and how they can be engineered.

This first episode is about ecosystems and will discuss definition, classification, research, business and the current state.

Definitions

The original meaning of the word ‘ecosystem’ comes from ecology, the branch of biology dealing with the relations and interactions between organisms and their environment. A common dictionary definition is:

“A system, or a group of interconnected elements, formed by the interaction of a community of organisms with their environment.”

But over the years the word ‘ecosystem’ has been used increasingly to denote any system or network of interconnecting and interacting parts. They can be natural, engineered, social or economic.

For instance in a business domain where manufacturers, retailers, and customers are all part of the automotive industry’s ecosystem. In that case the definition of an ecosystem becomes:

“A network of interdependent and interacting assets and actors that jointly generate, add, use and destroy value.”

The key component in this definition that differentiates ecosystems from any other system is the actor. The actor is the party interacting with its environment and surrounding actors. But unlike the definition from biology an actor does not have to be a living organism. It can be any process, such as a machine or a software application.

The Web11 movement adheres to this definition since it does not confine itself to purely biological ecosystems. One paramount additional requirement is that every actor is, or is represented by, a legal person. Although legal persons are in the vast majority of cases represented by humans, there is a global trend where things like rivers and forests are declared legal persons. This is a prerequisite for making ecosystems smart since that requires legal agreements (contracts) between the actors in an ecosystem.

The non-biological ecosystems are interesting for Web11 as well since many of those are working suboptimally as well. They can often generate more value by making them smart. Examples range from a small set of cooperating factories to complete countries.

But what does ‘smart’ mean in this context? In an ideal world, managing ecosystems is a zero-sum game since the combined positive and negative impact of all actors would be zero. The extent to which an ecosystem can autonomously reach and maintain this situation indicates its smartness. We will dive into more detail about ‘smartness’ in the next article in this series.

Components of an ecosystem

What are the components of an ecosystem? This can best be explained by taking different perspectives. Which perspective serves you best depends on what you want to know or do about the ecosystem.

Physical perspective

Besides ecosystems that exist purely in the digital realm, all ecosystems have physical components. Take for instance the natural ecosystem of a river. There is the water, the fish, the quay, maybe a wharf, a fisherman, some trees, a farm, a number of birds, etcetera.

Information systems perspective

Viewing an ecosystem as an operational information system gives another set of components. There are actors, messages, communication channels, state, history, etcetera. Not just within the ecosystem, but including interactions and relations between the system and the environment, as is common with an ecosystem perspective.

Legal perspective

From a legal perspective you could identify the legal persons representing actors and sometime even natural resources. The latter becoming more common recently with for instance rivers becoming legal persons. Law is another relevant component from a legal perspective. Which law applies? Who creates that law and how is it enforced? Another component would be agreements. Which agreements exist within the ecosystem? And between the ecosystem actors and external actors.

Economic perspective

It is also possible to view ecosystems as economic systems. This considers resources of an ecosystem, especially in terms of the production, exchange and consumption of value. The components then include things like the economic actors and the valuable goods.

Classification

Natural ecosystems are complex and diverse. They have no externally set goal and evolve by trial and error, and their survival value. This self regulatory system makes them naturally sustainable.

Artificial ecosystems are simpler but do have a externally set goal. They need external resources to continue functioning and thus are not self regulatory. This makes them less resilient than natural ecosystems.

Scoping when working with ecosystems

One of the most difficult aspects of identifying ecosystems is defining their scope. Every ecosystem is part of larger ecosystem and, on the other hand, consists of ecosystems itself. So the question is what to consider when working with ecosystems. Without proper scoping every definition ends up including the ecosystem of the whole world. Take for instance the ecosystem of a farm. It is fair to say that the harvest largely depends on the weather, but, as the butterfly effect points out, the weather can be influenced by something as small as the flap of a wing by a butterfly. So for any practical use case you will have to limit the scope of the ecosystem you are investigating.

How you limit the scope of your ecosystem depends on what you want and can include. Maybe there are some things you consider to be insignificant for your goal. Or maybe it is simply impossible to include a specific aspect, for instance the weather next year. Or maybe you lack the resources to include a certain aspect, for instance water pollution since that requires a large investment in time and money to obtain.

It depends on the ecosystem and goals you want to reach what you need to include. It might be that a small and simple model is enough for your purpose. It might on the other hand be that it will be impossible to find an answer to your question without including every aspect of an ecosystem.

Research

Ecosystems have long been an area of active research. Starting in the area of biology over the years many other disciplines shone their light on this topic. As mentioned above there are many possible perspectives looking at ecosystems, and for each perspective a different area of research is applicable. Biology might focus on the interaction of living creatures with their surrounding, economists might view an ecosystem as an economy, computer scientists might want to measure aspects of an ecosystem and/or design tools for analysing that data, mathematicians could focus on algorithms that simulate the ecosystem, etcetera.

Being an active field of research means that insights are continuously evolving about for instance what ecosystems are, how they work, and how they can be managed, protected and improved.

Business

Ecosystems have always played an important role in many business processes. Unfortunately the exploitation of scarce resources of ecosystems has been business as usual. The oil industry destroying ecosystems to get to oil, farmers burning down woods to create new farmland, the fishing industry emptying the oceans, the examples are probably well known and too numerous to mention. In most of these cases the ecosystems themselves were never compensated for this, sometimes leading to catastrophic consequences, not only for the ecosystem itself but for many larger ecosystems that depend on it as well. Fortunately over the past years we have witnessed the rise of what is known as Payment for Ecosystem Services (often shortened to PES). PES means that users have to pay for their use of the goods and services of an ecosystem. If a factory for instance pollutes a river it has to compensate for that. Carbon emission trading is another example where polluters have to compensate ecosystems for their exploitation.

Current state

Now that we know what we consider to be ecosystems, and what perspectives we can take, it is time to look at their current state. As already mentioned above many natural ecosystems currently reside in a sub-optimal state. Just to give you an idea, here is a list of examples that are probably familiar:

• Air pollution in big cities
• Sweet water reserves drying up
• Sweet water reserves flooding
• Rainforest deforestation
• Overfished seas
• Hunting of endangered species
• Climate change
• …

It is not just the natural ecosystems that could do better, this also goes for many artificial ecosystems. Take for instance the public space in a city or the exploitation of cheap labour in Asian countries. Actors in those ecosystems do not compensate for their exploitation or are not being compensated for being exploited.

Web11’s goal

Web11 is a movement that wants to help the world by helping ecosystems autonomously reach and maintain the best state for all stakeholders combined (including the ecosystem itself). The way it wants to achieve this is by enabling ecosystems to do so autonomously, which in turn is be done by making them smart.

The next episode in this series of three will discuss what it means for an ecosystem to be(come) smart.