Beyond uber how platforms rule the world Matthias Walter T-Systems MMS The platform innovation company
What are platform business models and why they are so successful How to build and grow a platform business See some examples beside the well-known
Full service Digital transformation Our solution portfolio Digital Digital Strategy & Transformation Consulting Strategy Customer Operational Digital Marketing Enterprise Portals Journey Excellence Digital Commerce Social Collaboration Digital Service Industry 4.0 Procurement Excellence Digital Mobile Solutions Cyber Security & Data Privacy Capabilities BI & Big Data Test & Integration Center Web Application Mgmt & Hosting Cloud Platform Solutions
T-Systems Multimedia Solutions GmbH Customer Satisfaction Great place to work The platform innovation company 96% agile, flexible, professionell, reliable, digital: a Great Place to Work 1.600 We are Our customers love us and recommend us. (Results from customer survey) Architects, Software Developer, System Engineers, Consultants, Projectleads, Tester, Security, Reelection as Partner Revenue 93% Designer … 2015 in Mio. € 155 Average Age Customer projects in 2014 2.786 37 years our customers would reelect us as a partner (Results from customer survey)
Digital Disruption? Source: http://www.spiegel.de/fotostrecke/taxifahrer-proteste-gegen-uber-in-frankreich-fotos-fotostrecke-127851.html
Digital Disruption! Source: http://www.spiegel.de/fotostrecke/taxifahrer-proteste-gegen-uber-in-frankreich-fotos-fotostrecke-127851.html
uber drivers > yellow cabs in nYC Only 4 Years
Why Softw tware are Is Eatin ing g The World rld By MARC ANDREESEN August 20, , 2011 11 This week, Hewlett-Packard (where I am on the board) announced that it is exploring jettisoning its struggling PC business in favor of investing more heavily in software, where it sees better potential for growth. Meanwhile Google plans to buy up the cellphone handset maker Motorola Mobility. Both moves surprised the tech world. But both moves are also in line with a trend I‘ve observed one that make me optimistic about the future groth of the American and world economies, despite the recent turmoil in the stock market. Marc Andreessen In short, software is eating the world. More than 10 years after the peak of the 1990d Twitter are ntro in Silicon
But …
„Software alone is a commodity. There is nothing stopping anyone from copying the feature set, making it better, cheaper and faster.“ - FRED WILSON, FOUNDER OF USV -
What about those?
Market capitalization 1995 -> 2015 x 150 SOURCE: Mary Meekers „Internet Trends Report2015“
What is the business model?
Platforms rule the internet 13 of 15 = platform business models SOURCE: Mary Meekers „Internet Trends Report2015“
What is a platform business model?
Platform (n): A multi-sides business model focused on creating value by facilitating transactions between two or more interdependent groups (usually consumers and producers). SOURCE: Peter C. Evans
connects many peers Consumers PLATFORM Producers Partners (multi-sided market) Platform Owner
Linear Business Platform Business Sells a product or service to a Facilitates a transaction between consumer multiple parties Owns one side of the transaction Owns infrastructure that facilitates the transaction Products have inherent value Platforms add network value „I derive value from my use of a „I derive value from other peoples use product“ of the platform“
example vs.
Other uses of the term „ Platform “ Computing Platforms Product Family Platforms Industry Platforms Platform as a Service
Platform becomes the new standard
Platform examples Exchange Maker Platforms Platforms Closed Services Development Controlled Product Development Open Payments Development Content Investment Social Networking Communication
Platforms today (2015) number market capitalization employees SOURCE: Global Platform Survey, The Center for Global Enterprise, 2015
Platform types SOURCE: Global Platform Survey, The Center for Global Enterprise, 2015
Platform companies by type (2015)
Platform companies by type & region (2015)
Platforms by enterprise type (2015) SOURCE: Global Platform Survey, The Center for Global Enterprise, 2015
Platform businesses in the S&P 500 30 25 20 15 10 05 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020
What are the factors that drive platform scale?
Key platform scale drivers Minimal costs of production / distribution Network Effect powered by positive feedback Behavior design & community culture Learning Filters Virality (not recommendations)
Show me the money! (How can I build my own platform business?)
A lean (startup) approach Prototype Business Model 2 Scale Build & Ideate 1 5 3 Launch 4 Product-Market Fit
Generate a portfolio of ideas & select the most promising one 1 Ideate Build a team Analyse technology trends Platform Business Visions Be creative Create Business model visions Platform Portfolio Matrix Score visions & decide
Pick your Role wisely Partner -> contribute Owner -> build & manage
Desktop for products SOURCE: Mary Meekers „Internet Trends Report2015“
Mobile for services SOURCE: Mary Meekers „Internet Trends Report2015“
On-demand platforms enabled by mobile + sensors + humans SOURCE: Mary Meekers „Internet Trends Report2015“
Identifying Platform opportunities Reduce high transaction costs or remove gatekeepers Underserved groups that need each other Potential complements Latent supply Large, fragmented supply
Platform portfolio matrix Stars Revenue per Producer Unknowns Consumer Growth Rate
Define the platform business model & collect early feedback 2 Platform Business Model Define platform business model Canvas Prototype Understand critical elements & success factors business model Digital Innovation Model Define and understand target user experience Customer Journey Map Build partner relations Get feedback
Platform business model canvas Owner Consumer Producer Partner Value Propositions Value Transactions Key Platform Components
Create and Launch a Minimum Viable Platform (MVP) 3 Customer Journey Map Understand Stakeholder Build & Journeys Digital Innovation Model launch Agile development to speed up Design Sprints prototyping and MVP Strategy Components building Define launch strategy considering key strategy components
Key platform components Tools & Services Match Making Rules & Standards Audience Building
Chicken-and-egg solving strategies 1. Enter with significant pre-invest (e.g. XBOX) 2. Build a cooperative strategy (e.g. Android) 3. Act as producer (e.g. iPhone) 4. Use an evolution strategy (e.g. AirBnB) 5. Subsidize high-value users (e.g. UBER) 6. Target a user group to fill both sides (e.g. Etsy) 7. Provide single user utility (e.g. early Instagram)
Validate with real market feedback & decide 4 Customer interview Perform Customer Interviews validate Data analytics Analyze acceptance and opportunities for growth and Business plan improvement Review decision criteria, business plan and decide (pivoting)
Scale 5 Platform Business Model Define & Plan Growth Options scale Roll-Out Plan Market Features Pivoting Execution
Mistakes to avoid Don‘t try to be good at everything Don‘t screw up pricing Don‘t think: If we build it, they will come
Sounds good, but show me some examples?
Example: Smart City Platform Deutsche Telekom
smartcity platform Deutsche telekom Consumers Producers Partner Owner
Example: Hmm Deutschland gmbh E-health platform for barmer gek Opticians and hearing 154,000 doctors aid 10,000 specialists 21,000 medical aid stores pharmacies End-to-end End-to-end medical aid medical aid management management Process takes just a few hours One platform Prozess komplett for all digitalisiert Reduced transaction costs Medical aids delivered in hours
E-health platform Hmm deutschland gmbh 154,000 doctors Opticians and hearing aid specialists Consumers Producers 21,000 pharmacies 10,000 medical aid stores Partner Owner
Example: MMS as a platform partner Consumers Producers T-Systems Owner MMS
Example: T-Systems as a platform enabler Consumers Producers T-Systems Owner
Let‘s rule the world!
Start your own platform business! Owner Consumer Producer Partner Free to use / download at www.creatlr.com
One more thing
Recommended sources Amrit Tiwana Phil Simon David S. Evans David S. Evans S. P. Chaudary (2013) (2011) (2011) Andrei Hagiu (2015) R. Schmalensee (2011) Platform Business Model Canvas @ creatlr.com Matthias Walter (2015)
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