Want FREE Templates on Organization, Change, & Culture? Download our FREE compilation of 50+ slides. This is an exclusive promotion being run on LinkedIn.


PLATFORM STRATEGY TOOLKIT



In describing the value of Platform Strategy, Microsoft's CEO Satya Nadella astutely observed, "Our industry does not respect tradition—it respects innovation." Amidst the Digital Transformation, it’s apparent that forward-thinking organizations that leverage Platform Strategy tend to be the most successful. These companies understand the power and potential of creating multisided platforms (MSPs) that link producers and consumers and create ecosystems of users and resources.

At its core, a Platform Strategy is a model that facilitates the exchange of value between two or more user groups. It builds on the idea of Network Effects where the value of a product or service increases as more people use it. Uber, Airbnb, and Alibaba are prime examples of businesses that have successfully implemented a Platform Strategy.

The Power of Platform Strategy

One only has to consider disruptors such as Amazon and Netflix to see the power of Platform Strategy. These companies have managed to reinvent entire industries through the strategic deployment of platforms. By creating ecosystems in which value can be exchanged, they have drastically lowered Operational Excellence and improved customer service.

Key Elements of a Successful Platform Strategy

Challenges in Implementing a Platform Strategy

Despite the potential payoffs, companies face many challenges when implementing a Platform Strategy. These can include developing the technical infrastructure, enforcing standards and rules, and maintaining trust amongst users. It's also vital to maintain a balance between the needs of the producers and consumers; too much swing either way can lead to user attrition.

Best Practices for Platform Strategy

  1. Create a compelling value proposition: It is crucial to articulate why users should engage with your platform. The value proposition should be clear, concise, and relevant to your target audience.
  2. Optimize for Network Effects: The value of the platform increases with the number of users. Strategies should be in place to attract, retain, and maximize the value of each user.
  3. Build Trust: Transparency, fairness, and security are key in maintaining the trust amongst users of your platform.
  4. Iterate and Innovate: Don't be afraid to learn from your mistakes and adjust your strategy accordingly.
  5. Incentivize user base: Encouraging users to interact with your platform can be achieved by providing incentives, be it financial or non-financial.

Tying It All Together: The Role of Leadership in Platform Strategy

While Strategy Development and technical considerations play a role in platform success, it's equally important to consider the role of Leadership. Effective leaders understand that a successful Platform Strategy relies on creating a Culture that embraces Innovation, Change Management, and continuous improvement. Fostering such an environment allows a company to pivot, react, and seize new opportunities as they arise, ultimately propelling a successful Platform Strategy.

For more information, have a look at these management topics:




CUSTOMER TESTIMONIALS




SELECT CUSTOMERS
Since 2012, we have provided best practices to over 10,000 businesses and organizations of all sizes across the world—in over 130 countries. Below is just a very small sample of our customer base.



Did you know?
The average daily rate of a McKinsey consultant is $6,625 (not including expenses). The average price of a Flevy document is $65.







Browse our Business Toolkits
to quickly find the documents you need.
Each business toolkit is a collection of documents around a common management topic.





TOP 40 TRENDING TOOLKITS


  Show all available toolkits.

Download our FREE Strategy & Transformation Framework Templates

Download our free compilation of 50+ Strategy & Transformation slides and templates. Frameworks include McKinsey 7-S Strategy Model, Balanced Scorecard, Disruptive Innovation, BCG Experience Curve, and many more.