Platform models are the new order of our innovating business need

Part of my shifting my own innovation advisory work was to build out a greater understanding of the power of ecosystems platforms and customer experience collaborations. This site here https://ecosystems4innovating.wordpress.com/about/   explains why there is this dedicated approach in my focus. Also oulining the reasons I chose to shift part of my business over to developing a “certain” knowledge expertise on ecosystems and platforms last year so to help others and equip myself for a growing part of the future of innovation.

Increasingly we are looking constantly for better value. We are increasingly restless and explorative. The big question for many companies that simply sell products is can they benefit from making changes in these platform models. How do they go about it to capitalize on this restlessness and constant need of new experiences? Is the stand-alone product model breaking down? Do the more traditional approaches to customers, those that are more supply sided, still serve their needs today? The answer is no, platforms are building very different connected experience for customers, they are voting with their digital clicks to move their business to these offerings. Are you building platform businesses? You should.

Consumers have come to expect more

When any form of digitization is introduced, the expectations of the customer rise exponentially, in the expectancies of service, engagement, response, and support – this is increasingly expected to be available 24×7. A brand is continuously determined by the service and how it fits within the individual’s life. This is having a more connected set of components coming from technology, built into the value proposition.

This rising expectation has its roots in our appreciating of the connecting value of Facebook, Google, Apple or Microsoft. Our ‘need’ for technology has grown in recognition that it can solve our personal problems and situations and is quickly becoming the norm of everyday life. Today the industrial company, selling traditional tangible goods, is expected to engage, to listen, adapt and offer ever-increasing tailored services to our personal needs.

Do-it-yourself has become do-it-with-us, let’s collaborate and let’s support each other on a more substantial journey to co-creation and this is where the platform comes in, the enabler to build the exchanges through.

We are seeing platforms transforming the business landscape to ‘search for new growth’

There is an imperative to understand the whole meaning and implications of platforms. The business implications of platform management are significant, they have a transforming effect on all we do within companies. As technology continues to change the way we do business, we move from being internally directed to externally driven. There is the recognition that innovation does not occur inside, it occurs through collaboration, engagement and admitting that other people may have better ideas and possible answers. There are many looking to combine up their expertise into a new, more radical design that increasingly meets the customer’s needs that they, alone, could never be capable of.

To understand where ecosystems and platforms fit within our corporate strategies, there are some well-respected voices discussing and predicting the rapid rise of the platform and what it all means in its implications and changes.

More and more people are asking constantly for platform understanding

Notably, for me, I have been referring back to a number of these experienced voices, as well as recognizing there are several books and thoughtful papers discussing the platform phenomenon and how it is radically changing our business landscape.

For me, one of the most exciting voices on platform’s comes from Simone Cicero and his team at platformdesigntoolkit.com. This excitement from my side is the result of how they are setting about tackling this. They are creating the design tools for platforms and by extension, ecosystems. These come in highly visual formats, built on the canvas approach where they fully provide the toolkit which you can download for free and a detailed user guide – providing their learning, growing depth in experience in workshops, masterclasses and consulting. They are increasingly focused on building stores around their thinking and are increasingly a great source of reference. Also, a great place to start is to download their Whitepaper “From Business Modelling to Platform Design”. Currently, Simone is working on how they are going to evolve their platform design toolkit. They made an incredibly long way in a short time, but this partly reflects the dynamic, evolving nature of platforms that each business has to get its head around. You can listen to Simone on this podcast to gain some excellent background on his thinking and developments around platforms.

The book “Platform Revolution: How Networked Markets Are Transforming the Economy – And How To Make Them Work for You” is co-authored by three of the leading voices of platform management, these being Geoffrey Parker, a professor of engineering at Dartmouth College, Marshall W. Van Alstyne, one of the world’s foremost scholars of information business models and visiting scholar at the MIT Initiative on the Digital Economy, and Sangeet Paul Choudhary, entrepreneur in Residence at INSEAD, who provides a great posting site from pipes to platforms. Each of them is bringing the considerable weight of understanding and insights into Platform Management to gain a really sound grasp of the shift we are all moving towards.

Then, there is John Hagel, co-chairman of Deloitte’s Center for the Edge, who provided valuable insights and thinking on ecosystems and platforms through Deloitte University Press with his colleagues. One of my favorite references is the paper “the power of ecosystems” which is part of a whole series discussing “Business ecosystems comes of age”, a must-read for anyone wanting to work systematically through ecosystems and platform thinking. They suggest that “Businesses are moving well beyond traditional industry silos and coalescing into richly networked ecosystems, creating new opportunities for innovation alongside new challenges for many incumbent enterprises”.

Furthermore, I valued Haydn Shaughnessy, along with Nick Vitalari. I would suggest different books like “the Elastic Enterprise” on how enterprises scale and operate in a completely novel way, as well as one written just by Haydn “Shift: A Leader’s Guild to the Platform Economy”, and a range of posts to highlight different parts of the platform equation. Haydn continues to explore at the edges of platform thinking which I absolutely value, although it sometimes requires me to re-read his thoughts more than once, but hey, that’s often happening on my own as well according to some.

My last voice on all things about ecosystems and platforms is Bala Iyer, a professor and chair of the Technology, Operations, and Information Management Division at Babson College in Wellesley, Massachusetts, who recently wrote a paper “To Predict the Trajectory of the Internet of Things looking to the Software Industry” where he identified 34 platform providers, although he identified 2,000 in total. In this paper, Professor Iyer provides a terrific graphic laying out the IoT ecosystem, one that is a broadly distributed among the network of these providers who, most of them, are providing application programming interfaces, many of them are offering infrastructure, devices, and platforms as their core, looking for others to connect and build their solutions on these platforms without the high levels of infrastructure investment cost. I’m presently looking to read more on Professor Iyer’s work, and we have been exchanging around the rapid number of platforms that are being created at present.

Each of these expert voices is great sources of knowledge, although they tend to revert to the software and technology-centric companies far more, although this has been the source of platform understanding.

The magnitude and impact of platforms is way too important to ignore it

To understand the implications the magnitude of the changing technology will bring and any decision to move towards a platform strategy needs a deep understanding of all the consequences, risks and investment cost, let alone in the different resources this will require.

This requires organizations to know what is cutting edge, what works for them and then working through the aligning of often complex IT systems, seeking higher levels of machine learning and investing increasingly in the future around advanced artificial intelligence. It is about exploiting technology that is appropriate to their and your strategic needs.

Platform management has formidable tasks in orchestrating, designing and developing clear and sound governance systems, along with clearly significant organizational capital to have the best chance to succeed.

Summary : Get to know the implications

The key takeaway is the huge implication for managers when making the strategic and operating decisions, is to fully recognize that technology is central, it changes everything on how you plan and organize yourself. It forms many of the decisions on a platform strategy, its design and eventual business success. It changes the organizational design, workflow and how it has this increasing need to be orientated out into a connected world.

** If you would like to read more on Ecosystems and Platforms I recently published on my dedicated website on these subjects this “Industry is lagging but catching up in its choices of platform offerings

 

** this was part of a post I provided and was published on the Hype Innovation Blog recently but here it has been updated due to recent developments and changes within the platform domain in recent months.

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