Value Designing

Platform understanding is growing

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I have put some focus back on the platforms recently, as this is becoming a real imperative to understand the whole meaning and implications of platforms, with the necessary management they require, so as to enable us to rethink different business models for the future.

There are without doubt real business implications in taking on a platform strategy as they really will be having such a transforming effect on all we do within companies and way beyond with others, including customers and even past competitors. They uproot the present and much of the established practicies.

They are changing the face of markets, industries, and competition but we within the established business world, mostly formed in the 20th centure seem slow to recognize their incredible impact, if we applied this platform thinking towards our own business, what would it mean?

There is a recognition that all innovation does not occur inside, it occurs from ‘open’ collaboration. It occurs from engagement and appreciating many others have better insights and possible answers, it is the power of combining them that has such economic consequence and great value creation potential. Our businesses are all becoming based on platforms.

The difficulty for many of us is first understanding what a platform is all about. The getting a clearer picture of the different types of platforms. Each has different tasks in building their specific “network effect” and how they are set up to interact and the type of problems they are attempting to solve. Some are really open, some are seeking growth, some are seeking collaborators to come together and work on ‘cracking’ more complex problems that one individual company would not be able to do.

In some of my recent updating of the platform breaking scene, I came across a terrific site that has created an open initiative to help entrepreneurs and organizations of all sizes to relate and build successful platform businesses, called Platform Hunt.

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Ecosystem approaches are simply radically different, be ready.

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There are significant differences between the ecosystems we might consider. Let’s reflect a little here, some recap and explore some further thoughts.

They all have complexity, they all need highly collaborative platforms to exchange and build through, they all need constant focus on aligning individual ecosystem players needs with the vision and prospective rewards this can bring to all participating parties.

The more engagement with the final ‘consumer’ throughout the process of insight,  discovery to solution building, to eventual proposition outcomes needs the highest ‘active’ attention and communicating for all involved.

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Adjusting to the Changing Landscape of Ecosystems

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the changing landscape for ecosystem and platform thinking

We all are being told repeatedly that opportunities will increasingly emerge outside of the traditional established lines of business, as new digital technology solutions take increasing hold in our adjusting to the changing landscape of our thinking in ecosystem designs.

The issue is how we go about adapting to these and taking advantage of the changes all businesses are undergoing. These will be through different approaches to designing and extracting the potential value gained and will form around ecosystems and their management, through technology solutions provided by platform providers.

I am not sure how you feel, but It seems disruption is in everything, in what we need to undertake, in what is coming towards us in change. It has a common purpose, often far less sinister than promoted.

Disruption is requiring us to re-equip and open up, as we learn to deal in this changing world where connections can emerge from anywhere at any time, offering a new ‘line of sight’ onto an existing business concept.

We need to respond quickly and in those different, collaborative ways. Digital challenges are everywhere, to explore and exploit.

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Amazon and Whole Foods expose an ecosystem gap – the last mile

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In case you were hibernating or out of range of cell cover or WiFi during the last few days, you know that Amazon has made an offer to acquire Whole Foods.

This places the largest online merchant in direct competition with some of the largest retailers in the US – grocery stores – and continues Amazon’s move into “bricks and mortar” businesses.

On this blog Paul and I have been writing about the importance of innovation in platforms and ecosystems.

With this acquisition, Amazon is attempting to extend its platforms into the “real” world and link up its power in the online world with physical stores.  Amazon understand a lot about attracting customers to its site, and does a reasonably good job at distribution.  Amazon gains a trusted “bricks and mortar” company that is respected (or sneered at) by consumers.  Whole Foods isn’t nicknamed “Whole Paycheck” for nothing, and there are some interesting dynamics between a company that isn’t concerned with profits and a company well-known for top of the line products and good customer service.  But we aren’t here to evaluate the integration of these companies, as much as to identify an ecosystem gap.

Amazon and the last mile problem

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The Future Is Within Health Ecosystems

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Source: IBM Institute for Business Value

I have struggled to get my head around the effect of ecosystems within the healthcare system; it is so complex.

In recent weeks, I have recognized the barriers and opportunities around the challenges of building ecosystems for health services to deliver real change within our healthcare and its management.

To help me, I have found some excellent observations to gain this deeper appreciation of the complexities involved. The links are shown at the bottom of this post.

This is my opening summary to relate my understanding of how ecosystem designs might help change this vital sector of our economies.

The first starting point is that the patient themselves have to become the centre of any future healthcare system, based on ecosystem solutions. Why? Firstly, the patient or customer will increasingly be demanding and expecting personalized treatment and want to be able to shop around to achieve this. Secondly, they are expecting and wanting to be part of a controlled method and choose advice and care delivery more than ever. Thirdly, they will shop for quality and cost as the cost models will increasingly look for this personalization to determine the premiums. The final customer will be central to drive the change, and the providers of ‘services’ keen to reposition themselves as responsive to this ‘need.’

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Blockchain and distributed ledgers as innovative platforms

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It had to come to this eventually.  The emergence of Blockchain and distributed ledger systems illustrates how innovation is moving from focus on products and services, which are interesting but don’t provide a long-lasting competitive advantage, to a focus on platforms and ecosystems.

Over the last few weeks this need for a lasting competitive shift in focus was emphasized as Ford pushed out its CEO because he wasn’t changing the company fast enough. As discussed in this blog previously, the automotive sector must rethink its competitive position.  Increasingly, people want flexible transportation – from cabs, Uber, public transportation and/or their cars.

The automotive manufacturers (Ford, GM, Fiat, Mercedes, etc) must shift their focus from building physical cars to providing transportation – a shift in thinking and strategy.

In a very similar manner we can see that banking and financial services are moving from offering discrete services (mortgages, loans, checking/savings accounts, etc) and are considering how to either own or integrate with larger platforms and ecosystems, because the older conventions are less attractive to emerging customers and technology is advancing so quickly that soon many different companies and industries can offer banking-like services.

Distributed ledgers and Blockchain may point out a new competitive platform that some firm is going to capitalize on.  For example, we can imagine a time in the not too distant future where a large company that supports and relies on an extended supply chain – the automotive industry for example – could dictate that all of its supply chain participants must interact using Blockchain.  Then we’d have a company spanning, industry wide ERP like platform.  If this sounds crazy, don’t laugh.  The government of Dubai just announced that within five years every entity that interacts with the government must do so using Blockchain.

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Many-to-Many (M2M) Business Ecosystems are far more challenging

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Our experiences determine to a large degree, success or failure. When you are reliant on others to collaborate and exchange knowledge, for the better good, you need to make sure there is a consistent validation process.

Building the multi-sided solutions where an ecosystem of providers is collectively working towards finding solutions that radically advance on existing ones, you have to enter these type of relationships with your eyes wide open, they are extremely hard and demanding.

They are complex in their relationships, collaborating and exchanging knowledge and expertise to get to a given ‘transformation’ point. You have to become adaptive.

They are differences in the different types of business platforms and who engages with whom and where they enter the value building chain. In my last post “Seeing differences between B2C and B2B within Ecosystems and Platforms” I covered the major differences between them.

Here in this post, I explore the considerable differences between ones that are one-to-many in the relationship that most of our digital platform solutions have been evolving into (B2B, B2C) and many-to-many. The complexity rises to a very different level.

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Seeing differences between B2C and B2B within Ecosystems and Platforms

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Jeffrey wrote a recent post “No walled gardens in B2B platforms” and started with this: “Paul and I have noted throughout our writings on platforms and ecosystems the key differences between companies that interact primarily with consumers (B2C) and companies that interact primarily with other corporations (B2B)”

I wanted to highlight some key differences as a follow-up post and was beginning to work on this when up “pops” a really valuable article by McKinsey “Finding the right digital balance in B2B customer experience”.

Jeffrey and I have championed the idea that customer experience is the ultimate innovation outcome, based on strong ecosystems and platforms so this caught my attention. The article does a good job of focusing the B2B companies to putting customer-centricity and experiences at the heart of their strategy. This offers good advice on the one-to-one model but less on the complications of many businesses working with other business on a two-sided platform of multiple participants

The writers for this McKinsey article, rightly point out the root of the problem is that while the role of customer journeys is central to both B2B and B2C, their incidence and importance are different for B2B and they go on and explain the chief differences.

I’d like to “lift out” these four chief differences McKinsey defines and discuss these more in the multi-sided platform context and ecosystem needs, going beyond the customer experience ones.

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Are you in a fog or a cloud? Get ready for more complexity to come

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So what is the difference between a fog and a cloud? Well, actually bandwidth is part of the answer and where data needs to be situated.

Slow connections are driving the cloud closer to the actual asset that has the information, the cloud needs. “Fog computing, or edge computing” is getting closer to those local computers and devices to solve this bandwidth problem we all will be having it seems.

Solutions are looking far more to the how and where we store data and how we are setting about how to access it.

Fogging solutions are coping with the problem that sensor loading is creating altering what goes to the cloud and why

The reason why I’m interested in this, on a dedicated site discussing platforms and ecosystems, is that this fog computing is attempting to solve multiple problems at the edge where innovation lies far more for us to understand, where the devices and their users generate the insights and raw data.

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When a platform becomes an operating system

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In the last post Paul wrote about Bosch, and its focus on the industrial internet of things (IIoT).  Bosch, GE and other industrial companies are attempting to create industry leading or at a minimum industry standard platforms to link industrial organizations and create standards, with the hope that new ecosystems and new solutions are built on top of those platforms.

Each of their goals is to capture, manage and exploit information generated from thousands of activities and sensors throughout the industrial platform.

Here we can the see opportunity and the challenges associated with an IIoT play:  building a platform and managing the data of an industrial giant means managing (and harvesting) a tremendous amount of data.

But it also means plugging into or interfacing with other systems and platforms, as none of these companies can create a holistic platform or replace all of the platforms and systems in a large company.  Bosch, GE and others can create really powerful and important platforms in sections or functions, but must integrate and share data with other platforms.  While they can create really powerful and compelling platforms, these platforms are by necessity limited to specific capabilities or functions.

Now for something completely different

Let’s examine then, the power and flexibility that an Amazon, for example has in its quest to build platforms through its AWS offerings.  First, it is focusing on business to consumer (b2c) or in many cases a category that Paul has coined:  consumer to consumer (c2c).

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