By Simon King
Platforms are BIG
Platforms are garnering a lot of attention these days.
New services in the cloud such as SocialGraph from Facebook, and Amazon's EC2 service platform are showing the potential value of such platforms.
But it's not just as simple as steaming down the track to the platform, as other platform suitors have found to their cost.
Being first may land you last!
In an industry study by the Wall Street Journal, 14 of the 15 platform leaders they reviewed were NOT the first too market. Only SAP, in the integrated business software market has achieved that dominance from start to finish.Source: http://online.wsj.com/article/SB10001424052748704007804574574211232106776.html
Entering the market later seemed to allow the followers to identify what really mattered at the First Mover's expense. The innovator spent all the money educating the market, but the Followers came in with faster, better solutions and took over control.
For a number of iterations, we have watched Apple time their product launches with more powerful devices, larger screens and new features - allowing them to take over the market initially owned by the BlackBerry.
Incremental and Continuous Innovation
Another key trend that the Journal observed, was that leaders continued to develop their platforms - creating extensions which added value for their customers.One of the most comprehensive demonstrations of such an approach was the way that DELL started with an initial concept of custom PCs. They innovated on cell manufacturing, creating a scalable way to for custom manufacturing. They expanded their channel through the web. Which generated more revenue.
The profit was re-invested in further refinements in vendor management and automation. They tried new models such as a stores, but backed away from them if the step wasn't a positive improvement.
For many years this step by step improvement in channel and then manufacturing allowed them to take control of the PC industry.
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