The Elements of the Platform Organization
Emerging & Organizing around Learning
Recently, at Platform Design Toolkit we’ve been often in touch with clients wanting to apply platform thinking internally, being it on their open innovation strategy, the design and development of their organization itself or other aspects, often in a broader effort to focus more on human potential and social interactions.
The key question we keep stumbling upon is: “how can we apply platform thinking internally?”
To some extent, using the word “internally” is not that correct anymore, at today: organizations increasingly see themselves as a blurred (inside-to-outside) continua, encompassing employees, partners, collaborators and other players from the ecosystem — as for examples with corporations exploring open innovation strategies with startups, developers and more. To explore this new idea of what an organization should be in a networked age, we definitely need new concepts; this new language needs to go beyond the one we’re used to use in the age of the Fordist organization: here’s where platform thinking can help.
But why should platform thinking be applied more widely also inside what we — used to — call the organization? The reason is quite simple: organizations are not impermeable to the general enablers of the platform economy. Pervasive technology, interconnectedness and almost-zero coordination cost also exist “inside” companies as individuals and machines are now radically and continuously interconnected.
>> Intrigued by this topic? don’t miss previous reflections <<
What does it mean to apply platform thinking?
As the reader may know, definitions of what a platform is, abound. In our approach, applying platform thinking means to design a System of Value Creation that can be represented as a Transactions/Relationships engine and a Performance Improvement/Learning engine.
On the other hand, as we partially explained already in the post dubbed “there’s no such thing as a Platform”, we believe that the learning processes in emergent-platform organizations happen on three different contexts, the organizational level (collective learning), the personal level (competitive learning) and the relational level (collaborative learning).
At the organizational level, emergent-platform organizations can learn by leveraging on data, measures and metrics. Organizational learning involves for example business model validation, measuring participation and engagement, evaluating experience, efficacy and more.
Personal, competitive, learning mostly happen inside the value creation structure, inside the platform itself. This is not a new insight at all — as we explained already in our whitepaper — the power of platforms lies in being, at the same time, collaborative and competitive contexts: giving everyone the same starting points, the same enabling services and tools, while encouraging massive reputation harvesting and, in the end, the emergence of the best.
At this level (individual), learning happens mostly thanks to the platform provided support services: the platform helps entities grow their performances, hone capabilities and generate reputation through enabling and empowering service that are available in the key moments when the entities need help, in their journey from onboarding to catching relevant new opportunities.
Relational learning facilitates this evolution and happens mostly thanks to direct human relationships, increasingly in the form of tutoring, mentoring, partnering and listening.
All these learning processes are powered by two essential organizational enablers: the intelligence (capacity to generate actionable insights from information and data) that helps organizations to learn faster and focused and the culture (intended as the set of values and beliefs that are developed, shared and transferred among participants) that support mostly relational learning among participants.
If we picture out a symbolic representation of the platform-organization we can pin down a few stacked layers: at the basic layer we have intelligence and culture on top of which sits the platform (the shaping strategy) that empowers the real value creation process that happens by means of it, supported and facilitated.
Depending on the value creation process — that might be strongly different among platform organizations — we have very different platform shapes.
Sometimes the value creation process is highly replicable even if complex: this is typically the context where SaaS helps manage complex multi sided market networks, a good example being honeybook or houzz. In other cases the value creation is quite transactional and straightforward and here’s the domain of vertical apps like Uber and Airbnb.
In further cases the value creation process is thoroughly and deeply complex, like in the case of companies and organizations providing design, research, consulting and knowledge work: in this case the “platform” is more a mix of software, practices, protocols, tools and (even unwritten) elementary rules such as a shared project management or strategizing approach.
Beyond the differences, an organization that wants to tap into the plus of the platform approach — like scalable growth and learning — should take care of designing a platform strategy that carefully facilitates the value creation process it wants to empower: designing proper contexts and channels is key to improve the possibility of a transactions/relationships to happen and therefore generate individual and relational learning.
As an example: let’s say that you want to use platform thinking to rethink the way your company incubates innovation from collaborations with the startup ecosystem. A revenue share agreement standard to start from when dealing a partnership, an — easy to adopt — investment term sheet that can be easily customized, are to be considered the channels where a transaction (a deal, an investment) can easily happen.
The last ingredient of the platform organization: Governance.
All these elements need to evolve over time: governance it’s the practice that the organization uses to evolve and iterate it’s basic functioning components to adapt to the changing environment.
Governance gives the organization a vision to tend to and the energy to evolve in that direction. Governance is the process that is in charge of evolving the key components of the platform-organization (the culture, the intelligence, the platform — and the governance itself) and to run the platform model execution.
From my previous experience in emergent platform-organizations, I can tell that some elementary, recurring, components of governance are needed to ensure that the process leads to continuous learning and organizational improvement. Governance should feature at least:
- a recurring ritual of coordination, priority setting & strategy-making
- contexts for shared vision making
- a decision making framework to ensure decision are taken in a trusted environment
If you want to adopt platform thinking to rethink your organization — or part of it — try to look at the existing situation and ask yourself where these elementary components are:
- are there channels ready to enable simple value creation?
- what are the intelligence metrics to understand how the system is performing, as a whole, in terms of learning? Is it getting better?
- does the company have a culture of nurturing, mentoring, tutoring that ensure relational learning?
- is the governance process ensuring the organizations can learn, adapt and evolve?
Being it a single process or the whole organization, if you want to rethink how your organizations works in the connected age, you can start from this simple model and ask these key questions.
In the meantime, in the background, we are working to provide you with open and accessible tools to assess and design your platform organization strategies in co-creation and be able to experiment and test them.
Stay tuned!
Side note: I’m going to give a Platform Organization Masterclass at at the OuishareFest in Paris in July, look it up! Paris.ouisharefest.com
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