We apply platform traits to drive value creation and sustainable growth.
(5 minute read on our core philosophy)
a new mindset is needed
Most businesses follow the principles of Henry Ford, who invented scalability over 100 years ago. But times have changed, and Ford’s linear, siloed methods cause more problems than they solve in today’s complex, fast-changing environment. They create friction internally, fail to drive customer loyalty, and contribute to today’s broader societal and environmental challenges.
When we look at the companies that are thriving today, they follow a totally different underlying mindset. Consciously or not, they’ve shifted from a metaphor of machines to one of living systems. Every organization is an ecosystem operating within other ecosystems — and you can’t control an ecosystem; you can only shape it through your DNA.
Platforms point the way
Forget what you think you know about platforms. They aren’t just for operating systems or becoming the next Uber of your category. At its heart, a platform defines the rules and standards for any ecosystem that sits on top. In this way, it functions like a DNA sequence that defines exactly what an organism will grow up to be.
If you’re trying to create a platform-based business model without also platforming your strategy and operating model, you’ve sown the seeds for your future downfall. If you’re a traditional business trying to figure out how to participate in the platform economy, this is where you should start.
The five traits of a platformed enterprise
Amazon and Apple aren’t leaders because they use a platform-based business model. They, and others like John Deere, use these five platform traits throughout their entire business. While it may feel like an insurmountable challenge to achieve all five, it’s totally doable; our Alignment workshop takes a high-level pass across all of these traits, and you’ll walk away with a clear vision and path to operationalization. The rest flows easily from there.
focus on a keystone outcome
Too many vision and mission statements are inwards-facing, focus on growth for growth’s sake, and often aren’t actionable. Conversely, high-growth firms focus on a big, aspirational purpose that can be operationalized, driving value creation for customers and the wider ecosystem in which they operate. An actionable purpose sits at the intersection of:
what outcome your keystone (priority) customers will pay you for
what you can credibly promise
what provides clear guidance for experiences and initiatives
what the world needs that requires an ecosystem to deliver. In other words, you want to set the vision big enough to enable you to grow into being an ecosystem shaper for meaningful impact, not just a vendor hawking widgets.
What’s a “keystone outcome”? In any biological system like a wetland, ocean or forest, you’ll find keystone species (like coral or grey wolves) that hold the entire ecosystem together. In the business context, that’s your priority customer, defined in a way that transcends and unites demographic segments; the outcome they seek forms the basis for your purpose and overall organizational platform. We have a methodology to help you do exactly that.
Every high-growth firm has laser-like clarity on their singular outcome-based purpose. If the purpose is designed correctly, then it will be blindingly obvious to every employee, function, business unit and partner what their role is in achieving it. This is about line of sight from every ecosystem participant to the intended outcome, while also baking in clear rewards and value for these participants.
Most executives will say, “of course our vision is clear!” But ask a representative sample of mid-level leaders (as I have done many times) and you’ll hear a resounding chorus of “we don’t know how to bring this vision to life.” And this is why these companies are stuck.
Coherence is the degree of unity across the experience and entire ecosystem to create the intended singular outcome.
Coherent light or water molecules are lasers that can cut through steel; likewise, the degree of your organizational coherence is a direct measure of your power. Imagine: if your organization was as aligned as a laser, fully optimized to deliver a single outcome that customers wanted to pay for, how successful would you be? How far could you go?
Focusing on a keystone outcome enables you to back-cast, a concept borrowed from scenario planning. Backcasting aligns people, processes and technology against the outcome, cutting away what’s non-essential in value creation. In backcasting, you start with an outcome and work backwards to implications for your organization.
You will find that different keystone outcomes lead to very different business implications and digital requirements. This is why technology needs to come last, not first, in your strategic thinking process.
Optimization defines the rules of the platform in order to create shared value. What should be standardized and centralized for efficiencies? What can be flexible and modular to ensure customer relevance and agility? What should the system be optimized to deliver? Apple is optimized for a seamless product experience with very little degrees of freedom; it uses one P&L and decisions are centralized. Conversely, Amazon is optimized for “immediate gratification” and agility; the goal and metrics are clear, but there’s a high degree of flexibility and empowerment baked in. For more information, refer to this McKinsey article on how platforms and modularity are used in high-performance product development teams; all we’ve done is extrapolated this practice to the entire organization and operating model.
Replication is how a mature platformed organization replicates itself like a beneficial virus. Once the rules of the platform (ie. your DNA) are defined correctly, you’ve laid the groundwork to replicate:
into new markets, like Virgin and Apple
core assets across an ecosystem, like Uber’s rides or AirBnB’s rooms
core internal capabilities into monetizable products like Amazon Web Services or Amazon Services.
If you’d like to learn more about how to quickly begin applying these traits to your organization, set up a no-obligation 30-minute intro call here if you’re compatible with the GMT+3 time zone. If not, or if you have a few questions first, please email me directly at firstname.lastname@example.org and we’ll find a time that works.