Digital transformation continues to be a critical factor for business success in the year ahead– but the manner of execution of this needs to shift to a new paradigm of platform based business and technology innovation. Here CEO hears from Tridip Saha, Head of Business Europe Sonata Software, on the trends in platform-based innovation in business.
Born digital platform companies such as Uber and AirBnB have been disrupting industry after industry with their platform business models and an underlying approach to technology that is very different from what has been seen as digital – viz point applications of digital technology to business processes enhancement.
The innovation has been to move from a traditional ‘pipe’ based approach where a business co-ordinates activities such as sourcing raw materials through manufacturing, distribution, sales and service to customers, to a new paradigm where a business has become an enabler by setting up a business platform system with a connected ecosystem of customers, vendors and partners that can efficiently exchange value between themselves. An interconnected platform has the added capability of gathering and analysing huge amounts of data generated by the ecosystem to enable more intelligent transactions and decisions to be made i.e. customer and vendor reviews, personalised recommendations, offers and predictive supply.
Platforms will also pave the way to new and unexpected business opportunities. Take for example the increasing use of enhanced multi-device multi-channel connectivity, mobile, IoT and big data functionalities, these will become far simpler to implement and integrate over the cloud. The scale and flexibility on offer will also make it possible to build and innovate on existing business processes far more easily. In fact, we believe the technique, platformation* will become the de-facto standard for balancing business and technology requirements to achieve platform-based digital transformation.
Doing all of this requires talent, in abundance, and the skills required could arguably be only found in places such as advanced software product firms, Silicon Valley start-ups and innovation centres of the world’s leading enterprises. The task at hand requires reimagining a business with advanced technologies and design thinking for business model and process innovation. To keep ahead of the curve, you’ll need some agile development and delivery. Essentially, you’re going to need a high-calibre team whether internally or with a partner or possibly both with some of the most evolved skill sets in the market. And just for good measure, since you’ll be radically reinventing current businesses or building new ones a culture of free-spirited exploration, co-operation and ‘maker’ culture wouldn’t go amiss.
The technology leader tasked with making it happen, whether you are the CIO, CTO or CDO of your organisation, must also be in sync with this thinking before embarking on any platform journey – it’s better to know now before you all head in different directions.
In summary, businesses need to rapidly shift gears to understand and execute on platform-based digital business and technology transformation initiatives, if they are to remain relevant and flourish in the emerging economy. It is little wonder that the S&P 500 is expected to have more than thirty platform-based players by 2020, representing some of the largest and fastest growing companies on the index.
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