I am getting fascinated by platforms and ecosystems. Does it show? This is why I am increasingly spending more time in this area as it is highly innovating in its potential.
I am constantly educating myself on this, as there is so much of this being new, or emerging, to make the connections for where innovation is going in “dual” tandem with technology and digital. A recent post I made tells of this growing connection for a new ROI.
I decided to become focused on business platforms and ecosystems for a number of reasons- firstly they are fascinating me ( I know I have to get a grip!) and more importantly for my business advisory work going forward in connecting innovation into this world.
So this posting site is a place where I share a number of strands of thought to provide increased understanding, to get others to become comfortable on their “learning journey” of new emerging industrial digital technology models, ones that offer a very exciting connected future but evolutionary in their nature.
I want to help shape, influence and amplify the breaking story of IIoT platforms-as-a-service as part of my advisory business model (as-a-service) and take them to the most important level of need to understand; the ecosystem building that is required.Taking on new journeys of understanding and potential for innovation is exciting, well for me.
Commercial break over so let’s get back to platforms and ecosystems…
At the moment I have been specifically looking at the questions that seem to be holding IIoT platforms back? There are a number of inhibitors. So how can a number of dark clouds dissipate for IIoT platforms to really become the future way of connecting up so much within your specific industry sector? This is first of two posts….
I have been looking at this in recent weeks. This post is just my questioning part. Actually lots of questioning. I’m still looking and figuring a number of different “strands of thoughts” to fuse, so stay tuned-in. We need to question much as we are increasingly placing IIoT platforms into businesses, but it the further step of ecosystem thinking that I believe will help dissipate these current clouds.
Lets first recognize the dark clouds that are forming, holding back real platform momentum and ask some questions:
Some of the largest industrial organizations are offering their clients their take on a digital platform-as-a-service. Included are GE, Siemens, ABB and Schneider Electric and I have been progressively reviewing each of these over on this site. 90% plus desk research and that has been limited by the time it takes, as none of these are providing a comprehensive story of hard, validate facts, they are often chosen to provide the facts that fit their own emerging story. Understandable for them, not for clients wanting to make a decision based on facts, or analysts attempting to validate progress.
In summary, GE has been at the forefront of this in building its Predix Platform. ABB with its Ability platform, Siemens with its Mindsphere, Schneider Electrics has its EcoStruxure offering. I want to turn my attention soon to what I assume (rightly or wrongly) are followers of this front pack. This includes Honeywell, Ericsson, Fujitsu, Rockwell, and Emerson, along with many others working through the decision of how to go digital, what to offer to connect up their customers into their business, what offering become a platform that works for their business.(note again, theirs)
Platforms being built for IIoT are far from open, they are still closed.
Here is where we can certainly start but it might not be based on the right principles to scale. I believe a platform should certainly be constantly working to be open.In platform theory, it needs to attract activity from the whole community that sees ‘s value in being part of it.
We have at least two sides of the IIoT platform
Firstly the supply side, dominated by the provider of the platform services. These are the ones that build, service, support and develop new services. Then we have the demand-side, those that buy the digital and technology solution services. The clients of the Industrial platform providers, the ones that feed the essential “need” or value, in data onto the platform and expect “returns”. If you do not get balance in this, the reciprocating value diminishes fast and the power of the “network effect” falls away. This needs addressing constantly, this really is keeping a balance between the system and a constant work-in-progress to push out and ‘feed’ the system.
At present, I see the platforms as being very Supply-sided. The view of “if we build, they will come” seems to dominate.The demand-side, on the other hand, seems a little muted. They receive but do they get to enable, build and tailor to their specific needs, through being part of the community on the platform or have to accept solutions built by others? They get provide data, they buy apps as their solutions, then they get back information, analytics, and actionable insights. Not a bad deal but is it good enough?They can happily gaze at dashboards that help them to be more productive and take further appropriate actions on top of ones previously but is this enough for the cost of change required? But is clarity of ownership of everything becoming the elephant in the room to address?
Tipping point or chasm?
Why are we not seeing a surge of platform investments by the very clients being told constantly of real productivity gains? Maybe we are close to a “tipping point” or that famous “crossing the chasm” outlined so brilliantly by Geoffrey A Moore.
There is much to reflect upon for platforms-as-a-service that there seems a much deeper need of validating far more before the majority make the commitment. Is it a far too risky investment decision to make? Is the return on investments not as easy to validate, to justify investing in one or the other specific IIoT platform solutions? What is holding many back from investing in IIoT platforms-as-a service solutions?
Understanding the theory “Crossing the Chasm” seems important here.
Quoting part of a Wikipedia reference:
“In Crossing the Chasm, Moore begins with the diffusion of innovations theory from Everett Rogers, and argues there is a chasm between the early adopters of the product (the technology enthusiasts and visionaries) and the early majority (the pragmatists). Moore believes visionaries and pragmatists have very different expectations, and he attempts to explore those differences and suggest techniques to successfully cross the “chasm,” including choosing a target market, understanding the whole product concept, positioning the product, building a marketing strategy, choosing the most appropriate distribution channel and pricing.
Crossing the Chasm is closely related to the technology adoption lifecycle where five main segments are recognized: innovators, early adopters, early majority, late majority and laggards. According to Moore, the marketer should focus on one group of customers at a time, using each group as a base for marketing to the next group. The most difficult step is making the transition between visionaries (early adopters) and pragmatists (early majority). This is the chasm that he refers to. If a successful firm can create a bandwagon effect in which enough momentum builds, then the product becomes a de facto standard. However, Moore’s theories are only applicable for disruptive or discontinuous innovations. Adoption of continuous innovations (that do not force a significant change of behavior by the customer) are still best described by the original technology adoption lifecycle”
So we might be at a chasm point for IIoT platforms-as-a-service. So we are full of those questions, questions, questions, to take us over the chasm- my quest is for finding answers that help make the “jump” happen. I have got some good ideas of where they might come from. There are many gaps to be explored and that is one of my current tasks at hand, as I am sure it is for plenty of others who have more of a “vested” interest.
To understand what is holding so many back in their decision to commit, is the key? Understanding needs are really important.
The investments to be made are seemingly deeply committing and the pressures always become one of achieving a return, providing others within your company that this digital platform solution was the right one to commit too. With so much of platform management still emerging, with plenty of conflicting views, it is an uncomfortable place for those making the decision. They need help, they don’t need “hype”, they need a factual understanding. How much value do we still place on independence and really believe in the “open” prospect?
Being open within any company or organization is still very much simply ‘open’ to their specific interpretation. We are hearing the IIoT platform ‘hype’ of being open but there needs to be a much better reflection of what being open really means and to whom? Open for business does not necessarily mean value for those that sign up and commit, it is the ones that manage the “digital gold” of data that are holding the future value positioning. The present wisdom is that the platform owner is in the driving seat of future value, are others really comfortable with that?
As platform providers race to build ‘apps’ or assign that to others to build, this promotes being open for application developers to add more “apps” to make available on the platform. This is great, it gives a real vibrancy and increased validation but is still ‘only’ part of a bigger solution, as this continues to build the supply-side, whereas today it is resolving demand-sided issues to gain more “network effects,” to turn a platform into a thriving community, growing in inter-dependency on each other.
I recall one insight, it went something like this “it is when the value to the community is worth more than to the platform provider you have a real platform solution”.
Being Open becomes one of the critical aspects to address.
The actions currently being undertaken might be moving towards being open, or they building more constraints for their platforms to be closed off, only available to those that have size, can make the investment and see value beyond the existing paradigms of “improved productivity” or “apps” they can apply to their business. Are we heading for a real open model or just advancing on existing models in (semi) open and selective ways?
Also by having a terrific list of “ecosystem” partners, that that make-up ‘the who’s who’ of consulting, supporting a platform build is equally great but is this open? I believe this heavy stacking on the supply-side in partnering has been part of the problem, even though they might have been essential to building the initial offering, it makes others on the demand side wary of what this might mean. The trojan horse effect of subterfuge? More on this later. Mixed messages need resolving.
I believe we need to dissipate the clouds and open up our thinking differently.
IIoT Platforms are full of constraints, conditions, and commitments. The way they are being built-in the offering might actually be holding back progress as the Business Model is perhaps more one-sided, at the very time momentum is needed, for data volume to build and that needs a different business model design, as ecosystems are designed differently.
For those that have been investing, there might be a good argument to keep on the current BM but there should be a healthy questioning on the present Business Model, does this appeal for the clients, you want to attract? I would argue, the IIoT platform is a different model than an IoT one and needs a new calibration of the BM offering.
I do see some dark clouds as we are very much “stuck” in the near-term horizon unless all these industrial organizations begin to really understand a business need is to focus far more on a thriving ecosystem that is really open, mutual respecting in value and contribution. A different emphasis in the platform building community.
Today IIoT platform solutions seem very internally focus on the one specific organization that is offering the platform and tailoring solutions to their business needs. I am sure they would disagree but growth should be moving at a far more rapid scale of adoption, for greater community value and exploring the ‘greater’ collaboration potential.
Perhaps the way they are structured is not a sustainable business model, and I’ll clarify what I mean by that in a subsequent post or two. What we need to do is open up to the world of ecosystems in its management and governance needed for IIoT. Also part of this exploration of IIoT platforms we need to delve further into the current state of adoption and development and the strategies required.
Part two follows: So are clients resisting IIoT platforms – why?