MIT Sloan Management Review Article on For a Return on Platform Investment, Focus on New Capabilities

The mere mention of Alibaba, Netflix, or Facebook evokes “platform envy” among executives at traditional, legacy organizations. That’s understandable. From Google to GitHub, platform companies — businesses that create value by connecting participants — continue to disrupt global industries and established business models alike.

Companies alert to strategic opportunities recognize that business success today requires taking part in and even creating open platform ecosystems — it’s not enough just to promote digital transformation. As the CEO of a global German industrial equipment supplier told me, “We know that in an internet of things world, we must go beyond products and components, and embrace platforms.” Every serious business is trying to embrace and extend its inner Amazon; to paraphrase Amazon CEO Jeff Bezos, “Go platform or go home” is the new managerial mantra.

About the Author

Michael Schrage is a visiting scholar at the MIT Initiative on the Digital Economy and a visiting fellow in the Imperial College Department of Innovation and Entrepreneurship. He has served as an adviser on innovation issues and investments to organizations that include Mars Inc., Procter & Gamble, Google Inc., Intel Corp., BT Group plc, Siemens AG, NASDAQ, IBM Corp., and Alcoa Corp. He has presented workshops on design experimentation and innovation risk for businesses, organizations, and executive education programs worldwide.

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