From Products to Platforms

At any major construction site in your city, you’re sure to find platforms. As a building rises higher and higher, the platform provides a place where a variety of people—including electricians, engineers, site supervisors, and inspectors—can stand.

Digital platforms serve a similar purpose—and as technology evolves, their value will grow exponentially. The proliferation of cloud, social, and mobile technologies have contributed to what has been called “a globally accessible network of entrepreneurs, workers, and consumers who are available to create businesses, contribute content, and purchase goods and services.”

As Mark Bonchek and Sangeet Paul Choudary have argued, there are three key factors that determine the success of a platform strategy: the ability of others to plug into the platform to share and interact, the ability of the platform to attract those who will produce and consume content, and the ability of the platform to foster exchange and create value.

In every sector of the marketplace the shift from products to platforms is already well underway. Your company should not be asking how to keep up. What you should be asking is what steps you need to take in order to set your company apart.