Future-proof your business with The Platformed Enterprise

I've been writing about business platforms and ecosystems, laying the groundwork for the model I'm sharing here in this post. If you missed it, you might want to visit this post, which introduces the topic at a high level, and this post where I define ecosystems and platforms in more detail. Another that may be helpful is this one that outlines "nested strategy" -- keep the Enterprise level in mind as you read further here.

To recap: In order for a business to become future-ready, it must shift from a siloed, linear model to a more dynamic, ecosystem-based model. The metaphor for business changes from a machine to a biological system that simplifies complexity and enables agility and resilience.

I like Yochai Benkler's definition of platform: “a technical and organizational context in which a community can interact to achieve a specific purpose.23  This takes the concept of platform well beyond the technology realm, but the same basic concepts apply. A platform in the technology context defines the shared purpose, standards and rules for anything that sits on the platform. Just as Apple developers must play by a different set of rules than Microsoft developers, one could argue that the entire Apple brand is a platform that defines an extremely coherent, differentiated plug-and-play environment and experience for customers and the broader ecosystem.

The platformed enterprise™

As discussed here, a core concept of an ecosystem is value exchange across diverse parties with complementary self-interest. To create a thriving business ecosystem, one must consider the "keystone species", ie. your priority customer. In a biological context, the keystone species is what holds an ecosystem together, and it influences all other types of plants and animals that make up that ecosystem. An ecosystem for a grey wolf is radically different than the one for a starfish. That means that the core value desired by your keystone customer informs your entire ecosystem internally and externally. For example, Apple's keystone customer type is "rebels who think different" -- which attracts and influences the entire ecosystem that forms around it regardless of customer type (individual, SMB or enterprise) or geography.

Which brings me to the model itself:

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The model is built in layers, designed to simplify the complexity of organizations and extended partners, with everything sitting on top of the strategy layer.

The Strategy Layer

Strategy at the enterprise level must be defined first, and is entirely based on the keystone customer. When you first define the keystone customer mindset or psychographic (examples here in Enterprise level), it serves as the organizing principle to simplify business ecosystem design.

The strategy layer defines the required ecosystem for attracting your keystone species, the specific value sought by the diversity of "species" within that ecosystem, and how players and motivations interact to create differentiated value across the entire system. It includes customers, employees and partners (offerings and experiences), as well as the broader communities and the environment in which the organization operates (informing a more aspirational purpose, plus increased ROI for sustainability and CSR).

“People think focus means  saying yes to the thing you've got to focus on. But that's not what it means at all. It means  saying no to the hundred other good ideas that there are. You have to pick carefully." - Steve Jobs

Focus is critical here; without a very clear definition and prioritization of your keystone species, you're left with trying to be all things to all people... which means you're nothing to anyone. No ecosystem will form or thrive around diluted focus with no clear way to decide what should be in or out of the system. Steve Jobs focused on a specific mindset, resulting in Apple being the first company to hit $1T in value.

The experience layer

This is the actual customer experience. It should itself be platformed, ie. fully seamless across departments and business units, and informed by the guidelines in the strategy. If you are aiming to create a platform-based business model, it sits in this layer; design should focus on the specific value exchange between platform participants.

But of course this focus on business model alone is not enough. You need to also apply platform principles to your…

operating model Layer

Your strategy and customer experience must be supported by an operating model (org structure, metrics, processes, etc) that is fully aligned and optimized for the specific value you’re trying to create. By defining the rules of the platform, you work more efficiently and eliminate redundancies. As you mature, you’ll also able to do things like externalize your core competencies across partners and a broader ecosystem to achieve unprecedented scale.

By thinking of your organization as a platform-based ecosystem designed to deliver a specific differentiated value, you can vastly streamline your business and achieve measurable efficiencies internally.

The Technology Layer

Most talk of platforms focus here, on the technology layer. But we believe that technology must be addressed last, because technology is an enabler of value creation. What value must be created across the ecosystem, across which entities, and how is that value exchanged? Digital transformation must be built on a solid understanding of the goals at the strategy, experience and operational layers in order to be successful.

In my opinion, this is the root cause of digital transformation failure. Digital is often tackled as a siloed initiative without being fully integrated into the rest of the business in a way that delivers a set of specific outcomes aligned with the enterprise-level differentiated value.

Questions or comments? As always, thanks for reading... your comments are very welcome. Stay tuned for more on this topic.