PILOT - Platform Strategies for Incumbent Organizations: Kick-off Presentation

A multi-sided digital platform creates value by facilitating transactions and enabling innovation. A digital platform enables direct interactions between two or more groups that are affiliated with it (Hagiu and Wright, 2015). It is the presence of network effects, particularly indirect network effects (i.e., more users on one side of the platform attracts users on the other side(s)), that define the digital platform.

The digital platform business model is capable of substantial revenue growth and increasingly mediating more and more socio-economic activity. While only about 12% of incumbent organizations have a digital platform strategy (Bughin and van Zeebroeck, 2017), “fewer than 5% of traditional companies have a coherent platform strategy that is integrated with their corporate strategy” (Torrance and Staeritz, 2019), and fewer than 2% have an active digital platform (Bughin and van Zeebroeck, 2017).

We seek to research how IRI members perceive the threat of digital platforms to their business models and how they are responding to it by engaging in business model innovation.

 

Presented by: 
Ruben Mancha
Assistant Professor of Information Technology
Technology, Operations, and Information Management Division
Babson College
 
Steven Gordon
Professor of Information Technology
Technology, Operations, and Information Management Division
Babson College