Thinking in Platforms: The Many Trains of Thought
The idea of “thinking in platforms” is not novel. More commonly referred to as “platform thinking,” the concept most often refers to a business model where a platform is created that provides the opportunity for an ecosystem to grow and add value. In this platform business model, the ecosystem includes several categories of participants from the platform creator to the producers that sell on the platform to the consumers. To take full advantage of the potential benefits of thinking in platforms, it is important to consider the perspectives of the various ecosystem participants.
Before Platform Thinking
Digital platform thinking has evolved over centuries. For example, before the Industrial Revolution, the canals that still support our global supply chain were one of the primary methods used to move goods. During the Industrial Revolution in the early 1800s, the invention of the steam engine was used to develop railroad technology. It took many decades, but a new “platform” of transportation emerged around rail systems to create a successful ecosystem for commerce.
Cloud platforms are the railways of today's digital transformation economy. The potential of platform thinking develops and becomes exponential as cloud platforms support the new platform business model. Consider Uber, another transportation platform where platform thinking is the driver. The original ride-sharing platform enabled an ecosystem that has evolved to include package delivery and food delivery. The platform is the business model, and the traditional linear supply chain-driven structure was replaced by monetizing an ecosystem where connecting producers and consumers provides the value. Per the nature of a platform, new lines of business can be created—as with Uber, Amazon, etc.—by using the same platform with comparably minimal development effort, resulting in new opportunities for customer value. The platform business model creates a win-win-win situation for the platform, provider and consumer.
From a Platform Creator Perspective
As an entrepreneur or startup, the perspective of platform thinking as a business model has unicorn potential. Notice the top five companies by market capitalization are platform companies: Amazon, Apple, Microsoft and Google/Alphabet. Venture capitalists like Software-as-a-Service (SaaS) platforms.
If you are an existing technology provider and your product does not already provide an extensible platform to support data and functionality to be integrated and/or consumed by other participants, perhaps platform thinking could boost your product roadmap. And if you are a product developer, platform thinking should already be front of mind.
From a Producer Perspective
The benefits of thinking in platforms go beyond the platform creator perspective to provide opportunities for producers and consumers. That is the whole point of this type of thinking. Even if your business model is not a platform, as an enterprise you are most likely a platform consumer and potentially a producer by adding some customer value within the platform ecosystem. If your business has IT and/or software engineering teams, there is a wealth of opportunity when thinking in platforms. For example, consider platforms that your customer already is using. Does it make sense to integrate your product to increase customer value and improve user experience and productivity? This may include researching whether monetizing that value via a marketplace—e.g. AppExchange powered by the Salesforce Platform—makes sense.
From a Consumer Perspective
When thinking in platforms, perhaps the most often overlooked perspective is that of the consumer. Particularly in large enterprises, there is often untapped potential to take advantage of existing enterprise SaaS platform capabilities. Google Workspace, Salesforce.com and Slack are some favorite and obvious examples.
Here is where your organization’s digital transformation strategy can benefit from thinking in platforms. As mentioned in the first post in this Practical Cloud Journey series, one of the elements of the cloud journey is understanding the role of the platform in the enterprise. For the IT decision-maker, when evaluating competing SaaS products, the offering that also provides a platform will be a differentiator. Even better if the product provides a marketplace and out-of-the-box integrations with existing enterprise solutions. Thinking in platforms should remind IT and enterprise engineers of the possibilities available for custom integration and extensions to deliver value to internal customers.
The importance of this consumer perspective is increased as the amount of enterprise data and systems increases. The ability to integrate systems and data to improve business productivity is at the heart of digital transformation. It is the platform that has given rise to the digital transformation movement, and therefore why we must remember to think in platforms from multiple perspectives.
The consumer perspective should also consider marketplaces for the same reason. Also, the platform marketplace is not just for SaaS products—Infrastructure-as-a-Service cloud providers are now providing marketplaces that benefit producers and consumers. By the way, a producer that participates in a cloud platform marketplace may very well represent another platform. This reinforces the exponential potential of the public cloud and explains why it is often the go-to for startup platform creators.
Here’s one final example that may help, building on our Google Workspace enterprise platform reference. A lot of corporate data—and I mean 95% of all information, or so it seems!—is in a spreadsheet. Recently, we were talking with a client about how a knowledge worker (not an engineer) could use a Google Sheet to keep track of patient pickups and drop-offs for a paratransit service (getting outpatients to and from medical appointments).
In order to turn that list of appointments into something really useful, we wanted to hook up a couple of APIs to a menu in the Google Sheet: think “geocode the patient and facility addresses,” then “find the most optimal way to get patients to appointments on a daily basis.”
In a non-platform way of thinking, we would probably want to build an app, figure out authentication for sensitive patient records and so on. Instead, we turned to AppsScript to do some light automation. This may seem like a trivial example, but the benefits of using the platform underneath the office collaboration tools are many:
- We didn’t have to train an office worker on a new app. Just use a spreadsheet!
- We didn’t have to write an app. We just wrote a little script and made it work within that spreadsheet.
- We didn’t pass sensitive data outside the organization. We kept it within existing boundaries established by corporate IT.
- We didn’t have to buy any new products. We leveraged the built-in capabilities of our collaboration tools.
It is getting to the point where thinking in platforms is becoming second nature to anyone participating in the digital transformation movement. However, participating in the platform ecosystem—especially for delivering digital transformation to the enterprise—is challenging work. This just creates opportunities for cloud products and professional services companies to develop targeted offerings intended to help enterprises and platform players accelerate and take better advantage of thinking in platforms.