2. Future of Industry Ecosystems – Platforms
and Sharing Economy (IDC)
- Customer needs/ wants/ experiences are dependent on complex products and supply chains.
These are difficult to address by any one organization
- Industry ecosystems leverage the sharing of data, applications, operations, and expertise
- Several key drivers and challenges significantly influence the purpose of an Industry ecosystem
References:
• https://blogs.idc.com/2020/09/23/the-future-of-industry-ecosystems-built-on-the-platform-and-
sharing-economy/
• https://en.idate.org/product/digiworld-yearbook-2020/
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3. Concepts
• Digital business models
“a business model describes the rationale of how an
organization creates, delivers, and captures value”
Alexander Osterwalder
(Author of Business Model Generation)
Digital Business Models Are Web Based/ Internet
Models
• Ecosystem concept is multi faceted
One powerful way is to think of Ecosystems as
interconnected firms or systems that have a shared
purpose in delivering value
• Platform Ecosystems – the collection of the platform
and the apps specific to it. (Platform Ecosystems
(Platform Ecosystems by Amrit Tiwana)
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4. Digital business models
4
Digital Business Models are web
based/ internet models
Evolving digital business models are
creative frameworks of integrated
business models growing in pace
with changing business
environments
Types of Business Models Brokerage,
Advertising, Infomediary, Merchant,
Manufacturer, Affiliate, Community,
Subscription, And Utilities (Prof
Rappa)
Prof Michael Rappa on Digital
Business Models
5. Digital business models - Examples
5
ONLINE LEARNING AND FEEDBACK
SYSTEMS – MOOCS
COMMUNITY MODEL – OPEN SOURCE
COMMUNITIES – GITHUB, LINUX,
RESEARCHGATE, INDUSTRY WIDE
COMMUNITIES INTUIT, SAP
ON DEMAND SUBSCRIPTION SERVICE –
SAAS
SOCIAL NETWORKS – KICKSTARTER,
INNOCENTIVE
6. Shifts in business models (Social, Mobile,
Cloud) – Part A
• Customer centric
• Mobile Payments
• Currencies
• Gaming for work
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Reference: Ted Shelton’s Business Models for the Social Mobile
Cloud
6
7. Shifts in business models (Social, Mobile,
Cloud) – Part B
• Decision making with AI / data driven
• Experience value
• Networked social sales and support
• Collaboration for safety and security
• Transparency and openness
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Reference: Ted Shelton’s Business Models for the Social Mobile
Cloud
7
18. References
• Examples – taken from platform scale by Sangeet Paul Choudary
• Web based business models: http://digitalenterprise.org/models/models.html
• Definitions and concepts from the following books
- business model generation by Alexander Osterwalder & Yves Pigneur
- business models for the social mobile cloud by Ted Shelton
- platform ecosystems aligning architecture, governance, and strategy by Amrit Tiwana
- Business of Platforms by Cusumano and Gawer
articles/ Readings
https://www.semanticscholar.org/paper/Digital-business-ecosystem%3A-Literature-review-and-a-Senyo-Liu/cae5a25e0f1a6b7808620ca7a9d981029df61d33
https://www.researchgate.net/publication/265922355_Evolving_Internet_Business_Model_for_Electronic_Commerce_Using_lexible_Systems_Methodology
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19. Watch
• Business Model Canvas explained
https://vimeo.com/78350794
• https://www.youtube.com/watch?v=7NMQD0RDMV4
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Any discussion about digital business models, Platforms and Ecosystems is about concepts that promote a language to describe how your organization functions.
Alexander Osterwalder simplified the powerful concept of Business model with a few building blocks which we hear quite often.
Any business is simply put about customers, offerings, finances to support, sustain, and grow and an operating infrastructure. With digital, the business is setting the stage for powerful and complex environments to operate. It is preparing for above and beyond what exists. Designing simple models and operating frameworks to adapt and scale, size and reach preparing for growth is the goal of a digital business.
The questions you seek about the customers you are serving, the value you are delivering with your diverse and bundled product and service offerings determine the purpose of your business. How you reach is a major theme behind this introduction as we delve into digital platforms and ecosystems.
Given an objective like coming up with a digital courier service model – the evolving aspect demands adapting to the situation based on the industry trends and changing business environments and technologies.
Consider how UPS and Fedex have evolved over the last decade.
The SWOT of UPS 2019 describes UPS as a global integrated network.
Compare it with the SWOT of UPS 2008… considering opportunities in an expanding CHINESE market.
In the evolving internet business models article, the author identified factors that are determined by a situation and how the changing business environment affects the evolution.
Situation comprises the business environment, the mega trends, the model development team is the actor and the process is evolving an integrating model.
Discuss the Situation Actor Process (SAP)- Learning Action Performance (LAP) framework suggested in the article for evolving UPS the next couple of years.
Expanding on business environment, Osterwalder refers Business Model environment in terms of context, design drivers, and constraints. They include the key trends, industry forces , market forces, and Macro-economic forces (Refer to Strategy section)
Discuss MOOCS - Coursera, EdX, Udemy.
https://www.amazon.com/MOOCs-Open-Education-Around-World/dp/1138807419
Learner centered environments – reach and scale
Salesforce: Subscription service, Bundling and free offers.
Community Model: GitHub:
https://digital.hbs.edu/platform-digit/submission/github-the-home-for-open-source/#
Social networks – Kickstarter, Facebook, Innocentive
On Kickstarter’s impact:
https://www.kickstarter.com/blog/kickstarters-impact-on-the-creative-economy
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2443114##
Facebook:
https://www.wsj.com/articles/facebook-the-inside-story-review-the-path-to-domination-11582606800
Customer centric – in the retail industry, customer is in control. There is a basic shift under way in consumer expectations and a tug of war between online and on ground store. Retailers are forced to think whether they are representing the supply side or the demand side.
Mobile payments –
Currencies - There is a tendency towards corporate sponsored currency – encouraging our dependence – see airlines loyalty programs for example. Rewards miles bookings, Evolution of the concept of stored value with money, A willingness to trust in entities other than governments, an exchange of value between two parties in which a seller provides value to a buyer. Virtual and sovereign currencies have their own place. Think about buying a car. Apps are the new plastic.
Expand the concept of virtual currency to employees at work, stakeholders to business – make it a game.. Gamifying is about emphasizing the desired behaviors with an ongoing reward system.
Any decision will be looked upon with trust when backed with data and experimentation.
A PLAN for incremental development of the basic idea with feedback loops to analyze the data.
Examining the types of questions asked and problems solved is a way to probe into the state of capabilities of the systems for the business. Tom Davenport brought up analytics maturity levels at the organization level more than a decade ago on how to take the first steps for exploring data based decision making in his work “Competing on Analytics.” He later discussed the three stages of Analytics maturity (Davenport, T. H. (2013)). He called the era of Business Intelligence as Analytics 1.0 (up to the mid-2000s with enterprise data warehousing capabilities and business intelligence software), Analytics 2.0 as the era of Big data (internet based social media and networks begin to amass data), Analytics 3.0 as the era of building analytical power into consumer products.
Machine learning is different. The talk about machine learning is around predictive or descriptive learning using big data applying statistical and mathematical models that scale.
Experience value – Think Nike’s value to the athlete. Think the self actualization pyramid – Maslow’s hierarchy of needs.