Platforms Are The Foundation For New Value Creation

Dan Bieler
Principal Analyst
March 17, 2017

While a lot has been written about consumer-facing platforms like Facebook and Uber, the platform impact on business-to-business relationships has not been as extensively investigated. However, these “business platform models” are transforming the way how traditional businesses create value. Business platforms will reorganize a wide variety of markets, work arrangements, and ultimately value creation and capture.

Business platforms push productivity improvements beyond automation activities. The real value creation now comes from analyzing data. These platform dynamics force every business to rethink its approach to innovation, marketing, sales, product development, delivery, and customer engagement. Business and technology leaders need to prepare to platform dynamics for several reasons:

  • Platforms change customer behavior and how businesses interact with customers. Business platforms will trigger radical changes to how we work, engage with customers, create value, and compete for the resulting profits. These business platforms offer companies fast access to scalable expertise at transparent cost and drive the much needed agility to quickly adjust customer experiences to changing requirements.
  • Business platform value creation centers on information gathering, sharing, and analyzing. Platforms focus on information exchange and provide an easier, more transparent way to access, analyze, and share this information. Business platform owners are developing power that may be more influential than that of the actual factory owners. But business platform owners do not have to own all factors of production; they tap into the expertise of platform participants.
  • How you deploy and use technologies determines your future — not technology itself. Technologies like cloud, big data, and algorithms will not dictate the future of your platform. The platform that creates most customer value wins — so design operations workflow around customer processes. Enterprise customers need to be able to model their specific business processes on top of business platforms. Do not start with the technology when building a business platform. Focus on the interaction that creates value between people or between machines.

The focus of my report, Business Platforms Power Your Digital Business, provides insights for businesses that are considering developing their own platform as well as those that want to use existing platforms.

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