With 2020 upon us, the emergence of digital platform business models has never been clearer. There are several uber-successful companies that are platform businesses, and they transformed their once traditional model. We now have some perspective/data to draw from and we also have some new firms on the block to pay close attention to.
“Seven of the 10 most valuable companies globally are now based on a platform business model.” -TheInnovator
Today’s hyper-growth-minded companies are looking to digital transformation as the answer. But, scalable growth has quickly become so much more than that. It’s not just digital transformation that needs attention; it’s how to adopt that concept and new activities within your business framework as well as your product/service offerings, and fashion an entirely new model within a new array of thinking. Basically, reshaping your business is required or your competitors will reshape it for you, and it won’t look good.
I feel there are similarities between existing business models and digital platform models. The four common problems mentioned in the Harvard Business School article, How to Be a Digital Platform Leader are all valid and hold true for both platform and non-platform businesses alike (pricing, building and maintaining trust, mistiming the market and hubris).
I believe a few there are some differences, and we should think about a few questions.
- To whom will be the necessary constituents interacting with the business to keep it healthy? These are not just one set of customers, they are customers and suppliers, both of which need to provide sufficient trust to the business and in some cases each other.
- How do we design and build the business so it can be easily scaled using those constituents?
- How do we use and maintain information and data captured from all parties, so it is compliant with the ever-changing global market requirements?
It will be exciting to see how digital platform businesses evolve and how the leaders within them evolve as well. Will it be winner take all? Or will there be room for several players, all carving out their share of the pie? Hmm… only time will tell.
Traditional business models are in dire need of a paradigm shift in thinking. This possibly could open doors for these businesses to see how a digital platform business model can be integrated successfully. If building your own platform business isn’t an option, maybe adapting your business to an ecosystem that is currently platform ready is the answer. The leaders of today’s global firms may need to take some lessons from young B-School entrepreneurs who are platform savvy and ready to take on the world’s largest firms with their platform ideas.
Digital transformation isn’t good enough anymore. It’s old hat. Businesses are now operating faster than ever and their ability to be agile and platform compatible throughout is key.
Scott MacFarland is the Director of Marketing for HMY Yacht Sales in Jupiter, FL. He’s an advocate of exciting new ventures, digital business, marketing, transformation, transformative learning, and how to continue to be at his best in today’s digital marketplace. Scott has had the opportunity to work with some amazing business leaders, all of whom were instrumental in his perspective and desire to continue growing through business change.
Photo Credit: Pexels – CC0 License – Christina Morillo