The digital enterprise and the age of platforms

The digital revolution requires companies to adapt rapidly to the evolution of their business models, their organization and their information systems. In particular, the information system landscape has to move from a collection of dedicated applications supporting the business activities to a set of digital platforms integrating agile business services.

The era of platforms

We entered in the era of platforms, which provide tools and services for rapid and continuous delivery of new user functions. We live in a world of never finished products (not in terms of quality, but in terms of completeness), in perpetual beta version, constantly adapted to the user’s needs of the moment. Most of them will also have a very short lifespan (two or three years), which is not common in the IT world, where applications never died.

To be responsive, and to build a new value proposition quickly (three to six months max), the platform must be “open” and offer anchors at both the technical and business model levels. The more platforms allow interactions, the more interactions generate value for the platform. Of course, some platforms impose transit taxes (Apple’s iTunes), but others are more open and compete with their own ecosystem (Amazon reviews its prices seven times a day to remain competitive with other vendors on its platform).

Platforms supporting new usages through APIs

Also, because the digital revolution is mostly a revolution of the uses, it is centered on the connected customer and his desires. Therefore, platforms must provide APIs for application creators (mobile, Web, TV, etc.) and delightful user experience to deliver a seamless experience.

Platforms act as growth accelerators, offering opportunities to tackle lucrative new markets more quickly. In addition, by opening their data and sharing their existing customer’s base through APIs, they allow developers from around the world to come and bring novelty and value to their own offering, while allowing them to generate business for themselves. The development of these ecosystems more and more often go through the use of dedicated “investment funds” that finance acquisitions or integrations (Facebook and Google are obvious cases).

We have thus moved from an approach where “everything is invented internally and packaged as products” (inside-Out), to an approach where we want to re-invent our business by adding external talent to reach a resonance, a network effect and mass adoption (Outside-in). This requires convincing a new type of partners, the developers, whom you need to create “around” you, and with you. The value offer must therefore be clear and adapted to this population.

Developers are the platform pollinating bees

Developers are difficult to attract! It is then necessary to move from an operational model based on “records” (“system of record”) to an operational model based on commitment (“System of Engagement”).

It does not matter if you do not have the best application or platform, or if you are not known as long as you have and live by your values. For BlaBlacar the key values are “shared transport costs” and “trust””. For AirBnB the values are the “quality and authenticity of the places of residence”, the “price” and the “service”.

Platform growth, the network effect

For the network effect to completely work and for expansion to be rapid, it is necessary to create real “moments of attachment to the brand”, as when opening the box of a new phone or via an impeccable customer service (strength of Amazon).

Platforms are not available off-the-shelves, you have to build your own

The creation of these platforms is not easy. You will have to build it, brick by brick, and make it live with your sovereign Information System (all the legacy applications you have) and with your outsourced or commoditized applications (in Software As A Service mode). For enterprise architects, this is undoubtedly a new field of study.

The BCG Data and Digital Platform vision

BCG has developed an offer and architecture vision around Data and Digital Platforms, leveraging your previous investments and helping you make the transition. See this introductory video and feel free to contact BCG to know more!

PS: I want to thank Anne-Douce Coulin for its comments and support

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Technology Innovations, Platforms, Blockchain, & API

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