Recap Platform Economy Summit 2018 — Europe’s awakening

Europe is an old and fragmented continent and that’s why Europe is late. Often, especially when it comes to digitalisation and platform economy. Lagging behind US and China, Europe is only number 3 regarding platform unicorns.

That’s why it was time to change this. Between 21.-23. November there was the first European Platform Economy Summit in Berlin. Led by an initiative of Deutsche Bank and SAP, my friend Simon Torrance (well known Platform Expert and Author), gathered top platform economy players from around the world to discuss, reflect and inspire the latest trends and initiatives by companies & startups.

We, the Platform Innovation Kit team, of course attended the conference but we also used day 3 of the event to teach a group of about 50 platform innovators about our Platform Innovation methodology and gave insights on how to build and scale B2B2C platforms.

Below you will find our recap of the event and what we learned about Platforms, Ecosystems and the Awakening of Europe.

This recap consists of the following reflections:

  1. Day 1 — Impact on European Union
  2. Days 2 — How Europe reacts
  3. Key Learnings for your Platform Strategy

DAY 1 — Impact on Europe

The event was opened by German Minister of Economic Affairs Peter Altmaier. In his keynote he underlined the importance of platforms for the German and European economy and the fact that to be successful, platforms in Europe should think global. Only when you aim to grow globally, you can compete vs. US and Asia competitors.

Peter Altmaier opening the summit

After this opening the first panel discussion about “ Why and how to re-think business and society in a digital age? Macro opportunities and threats for Europe” started.

Eric Brynjolfsson reflected on the “Triple Revolution” of AI, Platform and especially on decentralisation (blockchain enabled) as the core secret of hyper scaling businesses.

Personal highlight was the interview with Andrus Ansip, VP of the European Commission, and his clear statement to build sandboxed playgrounds for regulation testing. Means, there are 28 states in the EU. This fact alone makes it hard to compete, because as a platform you have to deal with 28 regulations. We definitely have to lower the barriers. Interesting side fact: In Europe there are currently over 7.000 platforms!

Andrus Ansip on stage

Platform Holdings on the rise

After lunch, the focused moved from a political & regulation perspective towards the industries. In the session “Global Platform Pioneers — how to transform an incumbent business models” companies like OLX group, Shibsted, Klöckner and Ping An presented the current status of their platform journey.

When you later talked to the audience, one specific thing always stand out: the very offensive approach of Ping An. The financial player from Asia is not just building one platform, no, they are creating a portfolio of multiple platforms — becoming a platform holding. (see also my previous post about this trend). So the pace was set.

Not only Europe needs to speed-up it’s platform innovation processes, no, it also has to double the speed to ensure that platform holdings from Asia or US are not eating the over 7.000 smaller platforms for lunch.

Eat your own platform

Another very impressive strategy has been presented by Rolv Erik Ryssdal, CEO of Schibsted — a media company from Norway. They are also focussing on building a portfolio of platforms and are not afraid to disrupt their own previous initiatives.

“It’s better to disrupt then be disrupted.” — R. E. Ryssdal, CEO Schibsted

For me, this shows a bold vision and strategy by Mr. Ryssdal — Strongly believing in the power and advantages of platforms. So if the original plan does not work, don’t give up, look for alternatives. Applause.

A similar approach presented Gisbert Rühl, CEO of Klöckner — the metal industry player. Some years ago they created “” as a marketplace for the metal industries. The incumbent company became a producer of the marketplace, but channel conflicts made it really hard to scale The solution? Create a totally independent platform.

With XOM they launched another white label marketplace for the industry, now they have two platforms in the market competing each other.

Industrie 4.0 — turbo charge Europe’s industrial sectors with platform thinking

This was a session I really was looking for: How to transform very traditional and asset heavy industries.

A very common strategy to build platforms is to look for information asymmetries and high fragmentation in the market. Patric Hellermann, Chief Venture Officer of Heidelberg Cement showed how heavily fragmented the construction industry is and this creates space for a lot of platform opportunities.

From B2B to B2B2C

The discussion continued and both, Patric Hellerman, as well as Tom Tischner, CEO of Axoom, made it clear:

“There is not B2B platform without C” — Tom Tischner, CEO of Axoom

Spotting a platform opportunity is one thing, but you have to create a compelling value proposition for the platform stakeholders. And this starts with the final consumer in mind.

A strong lesson we teach our masterclass participants all the time — using our newly designed “Platform Stakeholder Persona” canvas you can deep dive into the jobs and motivation of the stakeholder.

Europe’s tech ecosystem — how to stimulate and leverage innovative startups?

In this sessions it was all about the different models on how corporates and startups can play together or how corporates can use the speed and agility of startups to disrupt their own industry.

One particular model seems to make a real difference— Co-Creation. An approach of Europe’s leading company builder Factor10. Felix Staeritz, CEO, explained this highly successful approach: incumbent companies are joining forces with factor10 to create, invest and scale in new ventures. Compared to traditional approaches where consultants like Accenture or earning money just by building the new venture for the corporate, this new approach hard links the success of factor10 to the success of the new venture. For me this shows a truly partnership between a service provider and incumbent firm.

Platform Expert Sangeet and the PIK Team

DAY 2 — Impact on Industries

After day 1 with an high-level overview about Europe and examples from different companies, the focus of day 2 was to dig deeper into very specific topics. There were sessions in parallel where 4–5 leading thinkers and experts discussed different aspects.

Session 1: Next generation platform thinking

This panel discussion was led by Geoff Parker (Prof at MIT) and accompanied by platform guru Sangeet Choudary and platform players Daniel Lok (UBER), Alexander Schwarz (AirBnB) and Deborah Sherry (GE).

Very quickly it was clear that next generation of platform thinking is all about AI. Platforms are not just collecting data or sharing / exchanging data, they are using the AI to build “intelligence” which can be shared / sold to the platform stakeholders.

I only can support this observation. I was part of the journey releasing the “Data Intelligence Hub”, a data marketplace offered by Deutsche Telekom. Exactly the point of data intelligence based on machine learning algorithms is the core differentiator from other P2P data exchanges.

In a very good presentation by Tim Jaeger, Global Head of DIS at Roche, explained how the medicine company is using data and data intelligence to further enhance the patient journey from illness to healthiness. Transforming the business model from “razor blade” to “clinical decision support”. Interesting side fact: He stated that the FDA now shifts their thinking to adopt regulation processes to be ready for digitalisation / platforms.

Session 2: New Ecosystem Opportunities

In 5 panels in parallel the participants explored new opportunities in Consumer lifestyle, Financial services, Software & Hi-Tech, B2B networks and Travel & Transport.

I attended the Travel & Transport session to support my friends Klaus Schaaf (Head of Blockchain at Volkswagen) and Michael Jacobides (Prof for Digital Ecosystems at London Business School).

For me the discussion showed a big span between companies like Porsche (very traditional, very product focused) and Taxify (very open, distributed approach). E.g. Porsche is building a “platform” but what it means are digital services enhancing the physical product (car).

But this is not a true platform approach, I understand that it is hard to do in a very specific niche, but there are opportunities. Like Volkswagen, the mother company of Porsche. They are currently investing in Mobility as a Service initiatives based on blockchain. Showing their understanding of a potential digital ecosystem.

Also when you talk to Michael Jacobides from the London Business School. One of the leading thinkers about digital ecosystems. He clearly describes that the future of platforms is in thinking broader — ecosystem.

I call this the “strategic hard fork”, a decision companies have to make right now. Focussing on becoming a platform or going beyond to join forces with other industry players to create a shared digital ecosystem.

More about “strategic hard fork” in one of my next blog posts.

Session 3: Key capabilities and skills for platform success

This session again was parted into 5 discussions in parallel: Network effects & APIs, Exponential Organizations, Digital Identity, Mechanics of Online Marketplaces and Strategic Investment Options.

I attended the last one about investment options just because this is one of the most critical questions incumbent companies have when they talk to me about platforms. Mostly they already have a very good understanding about potential platform opportunities but they don’t know if they should build, buy or co-create.

And as I explained earlier in this post, the most promising one for me is to Co-Create with digital powerhouses. This helps to leverage the speed of implementation and hardly link the partner to the success of the new venture. Win-Win.

Closing Session

After all those create insights and discussions it was time to reflect on the main stage. Simon Torrance invited Markus Fuhrmann (DeliveryHero), Michael Jacobides, Rahmyn Kress (Henkel) and Samy Jandali (BASF) to the stage.

And two messages sticked with me:

First: Markus Fuhrmann explained that he sees a clear advantage of incumbent players vs. startups in launching a platform — they know the pain points of the customers already. Often the incumbents have long time relationships with the customers and know the problems, but they are lacking to transfer the insights into platform opportunities. Compared to a startup, which doesn’t know the industry and is lacking the insights, this could be a substantial advantage in being a quick problem solver.

Second: Rahmyn Kress, CDO of Henkel, stated that “disruption happens, but corporate culture prohibits innovation”. Most of the people love the comfort zone, but only a few really wanna walk the talk. And he continues with

“digitization is nothing, important is business innovation”.

And this is absolutely true and thats why people love the Platform Innovation Kit. It’s a simple and easy-use toolset to build Platform Business Models, not IT or product platforms.

This Summit was awesome — bringing the best thinkers & practitioners of Platform Business together. And it shows that there is hope for Europe to compete in this global battle for platform dominance. I really looking forward to the Summit 2019 and if there is progress.

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Matthias Walter

Matthias Walter

Helping incumbent organisations fightback against digital disruption with platform-based business models | Creator of the Platform Innovation Kit

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