No company can manage on its own nowadays. And certainly not now that the pandemic is giving digitalisation worldwide a turbo charge. What should they do? Working together in a platform is a good survival strategy and the best way to enable rapid growth.
“Large companies have brand awareness and brand equity. They have capital, many partners, a good network. They have channels of communication. And often they also have very good data,”says Hugo Raaijmakers, global head of digital platform strategy and innovation at PA Consulting. "All in all, a perfect starting point for a digital platform."
On the edge
“What large companies previously lacked was a sense of urgency,” Raaijmakers continues. “But the current pandemic means that every company is now on the edge. So now is the time to really start working on a digital strategy. And I advise large companies to immediately turn this into a digital platform strategy. Because if one thing has become clear to me, it is that platforms are the future.”
You are stronger together
Forbes publishes a list of the world's most valuable companies every year. The top five? Apple, Google, Microsoft, Amazon and Facebook. What do they have in common? They are all companies with a data-driven approach and a strong platform strategy. "And no, that is no coincidence," Raaijmakers emphasises. “Those companies treat data as their most valuable asset. They are also not afraid to try new things and venture into new markets. In doing so, they make full use of the ecosystems that digital platforms offer. You are stronger together. If you ask me, being fully committed to digital platforms and ecosystems is currently the most successful way to enable rapid growth. And companies that realise that are the clear winners. ”
It’s only the platform that is on the balance sheet
Raaijmakers cites Uber as an example. “That company has found two groups that fit together perfectly: people who need a taxi and people with a car who have the time and desire to take people from A to B, and who find that a pleasant way to make money. In turn, Uber makes money by cleverly bringing those two groups together. And it’s only the platform that is on their balance sheet."
“I noticed how useful their solution is when I was in London and couldn't use my Uber app. Finding an empty taxi was a disaster! In the end it took me an hour. That is a very big difference for Uber: a car will drive up to you within three minutes and then be exactly where you are. Brilliant. Many people do not realize how many experiments and adjustments were required to make that process run as smoothly as possible. ”
Frightening the competition
"At the other end of the spectrum is Amazon, a real platform giant," says Raaijmakers. “Their platform connects dozens of players who together increasingly manifest themselves in almost every conceivable market; from retail, education, healthcare and financial and professional services to energy, electronics, logistics, gaming, media and entertainment. The only way to compete with that is to set your own position in the platform economy. Digitisation is a precondition for this."
Global digital acceleration
“The special feature about this time is that the pandemic is a huge digital accelerator,” he continues. “I think when we look back five years from now, we will realise that COVID-19 has brought about a digital revolution worldwide. This development is currently providing enormous opportunities. But as a company, of course you have to tackle that.”
“The first step is: develop a strategy to determine what your position will be in the ecosystem of the platform. What other players are there in your ecosystem? What could be good business models? Which partners do you need to make a platform a success? As soon as you know where you want to go, you can start innovating in a targeted way. By developing digital possibilities that match the position you want to take, you create an agile organisation that is able to make optimal use of the advantages of the platform economy.”
Finding a good problem
“It is important to have an open and investigative mindset,” Raaijmakers emphasises. “So don't immediately think in terms of solutions, but first find a good problem. Many people skip that step. But every successful innovator starts with a problem and then validates in the real world whether people really experience it as a problem. So if you begin there, you will immediately have a good head start.”