With customers spending the majority of their time on digital platforms – e.g. social, messaging –they are becoming the preferred and dominant business model offering consumers the ability to connect to service providers through an online, or mobile channel, as an integrated part of their day-to-day activities.
While there may be a belief that platform models are only relevant in a business to consumer (B2C) context, it is the business to business (B2B) world that is seeing the most activity according to French national, Laure Claire Reiller, co-founder of a London-based consultancy called Launchworks. Reiller cited examples of B2B platform developments in many verticals (Siemens’ EasySpareParts marketplace), boutique law firm services (Lexoo), and office supplies for businesses (Amazon Business marketplace).
Seven of the ten most valuable companies globally are now based on a platform business model: Apple, Google, Microsoft, Amazon, Facebook, Tencent and Alibaba and they have used the model to grow exponentially, taking significant market share from established firms. However, experts say established companies have the chance to create platforms of their own, or at the very least, become part of another platform’s ecosystem.
Not all companies require a full move to a pure platform model. A shift towards a hybrid model – a platform-powered ecosystem - may be what is needed, in which the existing traditional model of the firm is supplemented by a platform business for some activities, as a key success factor for differentiation.
The digital platform comprises of a number of technology building blocks, each dependent on having the right data at the right media, together with innovation accelerators such as robotics, natural interfaces, 3D printing, the Internet of Things, cognitive systems, and next-generation security.
Core enterprise resource planning (ERP) processes still have a critical role to play, but they must be able to integrate seamlessly with these new digital technologies. Gartner describes this as a bimodal practice. On one hand you have a structured, given, safe, secure [approach to project delivery] – and that’s essential for the core project work, partnering that with a more agile approach for new initiatives and product development.
According to the World Economic Forum COVID Action Platform, interest in Fourth Industrial Revolution technologies has spiked as a result of COVID-19, however fewer than 9% of companies currently use advanced technologies such as machine learning, robotics or even touch screens. The Forum asks “What do organizations need in order to accelerate the uptake of technology and how can they avoid the issues that arise from a lack of governance?”
With more business leaders understanding that the organisations that thrive in the digital economy are those that can blend digital and physical experiences to garner customer allegiance, digital transformation is now a priority. And it’s a priority because it turns information into a competitive advantage and creates new revenue streams from connected systems, leveraging technology to win the talent war. We can therefore see that digital transformation and disruption is driving new business, new ways of working, and new ways of collaborating and communicating.
stronger than one