Massive new startups like Uber taxis, Airbnb and many more are pioneering the ‘On Demand Economy’, implementing a Cloud-based On Demand Business Framework which overlays a ‘digital mesh’ across a marketplace of vendors, such as taxi drivers or travel accommodation.
The repeatable secret sauce is the Platform Business Model, described in detail through academic literature and popular business books.
For example the MIT book ‘Platform Revolution‘ describes these hyper-scale disruptors like Netflix, Uber, Airbnb, Facebook, Twitter et al, as the book describes:
“Facebook, PayPal, Alibaba, Uber-these seemingly disparate companies have upended entire industries by harnessing a single phenomenon: the platform business model.”
The book builds on prior MIT research, such as this detailed 2007 research report on Platform Networks, this highly recommended presentation Platform Strategy and Open Business Models, and in a simpler format in this presentation, which defines:
“A “Network platform” is defined by the subset of components used in common across a suite of products (Boudreau, 2006) that also exhibit network effects. Value is exchanged among a triangular set of relationships including users, component suppliers (co-developers), and platform firms.”
Throughout these materials they provide an anatomy of these business models, exploring dynamics such as “multi-sided pricing“.
Platforms are marketplace models, ranging from the people-centric services like Uber taxis and Airbnb accommodation, through to electronic distribution channels like Apple and X-Box. MIT examines the different permutations and shares those best practice insights.
The Platform Manifesto
MIT describes it as a transition to a multi-sided market model, which they capture eloquently in this presentation, via one scenario that describes the shift as ‘From Warehouse-Powered Store (with a goal of liquidating inventory) to Ecosystem-Powered Marketplace (with a goal of governing ecosystem interactions)”. (Slide 26).
Government as a Platform – Toolkit and Modeling App
Applying the model to the public sector is described as ‘GaaP’ – Government as a Platform, and in conjunction with Tr3dent we have started developing a toolset, app and consulting capability to model this scenario.
The Digital Ecosystem Blueprint is a report template that defines combinations of Role Models, Business Model Canvas designs, API links and other building blocks of a digital business model.
This is produced from Tr3dent’s Transform Accelerator app, and we have defined a central template pool that customizes it for the Scottish public sector. The download below provides an example output that acts as a starting template for planning an Ecosystem-based digital transformation model.
This is an ideal starting phase for embarking on an overall Digital Transformation journey, clarifying executive vision into a number of key planning documents that can shape later IT work efforts, communication programs and other transformation resources, providing the foundations for a Digital Roadmap.
Download: Digital Scotland Ecosystem Blueprint