Strategic Technology Platformsby Sam Mishra, Author, Strategic Case Analysis
Let's think for a minute what platforms are? Platforms are where trains slow down, stop, people get in and out of the trains, and trains speed up, and trains leave. Platforms are essential to trains.
In similar fashion, the million apps (or software applications) written to the iPhone platform depend for their speed and locomotion on the iPhone application platform. To a large extent, the fact that iPhones have taken off teach to the uninitiated in technology a crucial product strategy paradigm: technology managers should move beyond conventional thinking about strategy and capabilities to compete on the basis of platforms, or complements to their core products / product lines.
Let's read the DUMB and DUMBER section from a past home page of the portal to get warmed up a little bit:
Dumb and Dumber
I have a friend / side-kick; he is humane, somewhat geeky, and completely opinionated. But he does not get strategy. He also hates Zuckerberg, since he thinks Zuckerberg stole the code from his Harvard project and got Facebook started. In fact, he calls it "Fakebook." I have had many dialogues with him regarding how trying to be rich is not a crime in this world choke-full with greedy bankers and stealing entrepreneurs (as you know, I love dialogues: my first book Strategic Case Analysis contains a multitude of solved business cases in a Socratic Dialogue format). I have told him that by not having a "Fakebook" account, he was missing out.
So, one day, I decided to teach him strategy, and in the process, make him love Facebook, or "Fakebook." I wanted to explain that Facebook has a good strategy, since it is not a "product," but a "platform." To explain to him that Apple took off after it changed its strategy from Products to Platforms, I started talking about i-Phones (yes, the i-Phone platform to which a million apps have been written)... However, he was already angry that I was not angry with Zuckerberg or "fakebook." So, my friend started arguing over Skype (back then, I had a Motorala, and was waiting for the iPhone 4G model): "I own an i-Phone, do you own one?" Before I could delve into Product vs. Platform Strategy, he signed off...
Dumbfounded, I wrote him this mail:
"But I forgive u, since u dont understand strategy...zuckerberg is executing...u r starving...the point is not who owns the iphone and who doesn't the point is who understands strategy and who doesn't
u don't get it hence i call u dumb
did u know twitter generates all the rss feeds for u
did u know an app connects twitter with facebook
did u know facebook paid off the guys in harvard and settled the law suit
who are u
above all laws
u r a hater too, u hate zuckerberg
I thought the sidekick would wake up, and send me a nice mail. But he was sulking, since I had called him dumb. So, I sent him a second e-mail, explaining the "Platform Strategy" that high-tech companies need to adopt to win:
"This is how Twitter and FaceBook help me by automating my work for free ---
Even people in India use it for viral marketing. You must be dumb to be stuck in the google world of products (my friend loves all things Google and hates everything Facebook). The world has moved to platforms, and Fakebook is one such platform. Thousands of small entrepreneurs feed their belly by writing apps to the Fakebook platform. I used iPhone as a platform example --- once Apple did that (and changed its focus from products to platforms), its stock started going up... that is strategy.
But you quarrel about who owns an iphone and who does not --- you must be really dumb. And dumber to waste money on the gadget, when u have no income (back then, he was unemployed, or seriously under-employed).
If you are so serious about copyright infringement, write to the judges who settled the fakebook lawsuit..."
While I am hopeful that my friend will someday forgive Zuckerberg for "stealing" the "fakebook" code from his "Harvard employers;" you have hopefully understood the new realities of networking effects we live in... In particular, for high-tech businesses, for a while, it has been not just products, but also services. And now, a paradigm shift is emerging: it is not just products (and services), but also platforms. Especially when it comes to high-tech products and solutions, one can't win by just a services strategy anymore; one needs to think platforms.
Dumb and Dumber Section Ends
FRANTERACTIVE THOUGHT LEADERSHIP SUMMARY: A platform strategy, as opposed to old-fashioned product strategy in terms of products and services, requires an external ecosystem to generate complementary innovations. As a result, "iterative feedbacks" between the complements and the platform help the technology / product underneath the platform increase its potential for growth and innovation at a rate unmatched by single firms trying to innovate alone!