Mutualism: An Approach to Optimizing Shareholder Value

Mutualism: An Approach to Optimizing Shareholder Value

In the “new world” which is emerging from the “primordial soup” of the recent financial / economic maelstrom as well as dealing with the underlying shifts in consumer trends, organizations would be wise to consider a new approach to developing and executing the right plan for optimizing shareholder value. This new approach, or “mutualism, ” is a practice that drives the formulation and implementation of the most favorable value creation decisions by recognizing and taking advantage of the co-dependence of all of the various entities that make up an enterprise. From the business’ perspective, IT is viewed as a revenue generator and cost cutting engine rather than merely a cost of doing business. From IT’s perspective, practicing mutualism provides the opportunity to move from “order taker” to strategic partner and trusted advisor.

Mutualism Defined

Quite simply, as we all learned in biology class, “mutualism” is the recognition by the various organisms that make up an ecosystem that their respective welfares are a function of their mutual dependence. The effective practice of mutualism is measured by the health of the organisms as well as the health of the larger ecosystem.

Take for example the mutualistic relationship of the lichen. While a lichen may look like a plant, it is actually an “ecosystem, ” i.e., a complicated association between a species of fungus and algae. The fungus attaches the lichen structure to a surface such as a log and absorbs nutrients from the surrounding environment. The algae inside the protective envelope of the lichen structure uses the nutrients absorbed and carbon dioxide produced from photosynthesis by the fungus. In turn, the sugars and oxygen created by the algae is used for food by the fungus. The benefit of this highly successful mutualistic relationship is the lichen’s ability to colonize habitats that are hardly survivable by other plants and animals(1).

In the world of business, the ecosystem could be as large as the U.S. economy. For the purpose of this article, the ecosystem is the corporate enterprise; and the organisms that make it up are the entities that make up the enterprise (e.g., “business” and “IT”). The health of the enterprise is measured by shareholder value; and the health of the entities is measured by the value they generate – the contributions they make to growing revenue, decreasing expense, increasing leverage, and/or reducing risk. Therefore, at its core, mutualism is a collaborative decision-making and implementation approach that is focused on maximizing shareholder value over the longer term.

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