platforms in manufacturing – emergent themes related to ... · platforms in manufacturing –...
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Platforms in manufacturing –Emergent themes related to organizing business with platforms.January 17th, 2017 @ Design Factory
Dr. Ville Eloranta, Postdoctoral ResearcherDept. of Management Studies & DIEM, Aalto University
@villeeloranta www.linkedin.com/villeeloranta
Platform Value Now focuses on understanding the fast emerging platform ecosystems, their value creation dynamics and requirements of the supportive institutional environment
1. “Command and control” has been thedominating organizing paradigm in platforms
2. State-of-the-art research leanstoward decentralization and value sharing.
3. Holistic perspective is needed to leverage the situation
Key messages of this presentation:
@villeeloranta www.linkedin.com/villeeloranta
Key messages of this presentation:
1. “Command and control” has been thedominating organizing paradigm in platforms
2. State-of-the-art research leanstoward decentralization and value sharing.
3. Holistic perspective is needed to leverage the situation
Platform – everyone’s favorite term withso many definitions.• Uber, AirBnB, Amazon, Alibaba à Multi-sided marketplaces• Android, iOS à Industry platforms• Tekla BIM, VAG, Boeing à Supply chain integration platforms
Prevailing perspective to organizing business with platforms
Governance paradigmVertical and horizontal control and integration
Value appropriation modelOwnership of critical components, legitimacy, and architectural
control
1. “Command and control” has been the dominating organizing paradigm in platforms
2. State-of-the-art research leanstoward decentralization and value sharing.
3. Holistic perspective is needed to leverage the situation
Key messages of this presentation:
@villeeloranta www.linkedin.com/villeeloranta
State-of-the-art platform discussion has started to challenge the “command and control” perspective.
Growing customer anger towards”new data-driven ownership models”
”Service Democracy” movement, enabledby combining IoT, AI, and blockchains
Organizational research from the last 15 years finally goes into practise…
… also in manufacturing!
A new school of platform discussion is emerging viewing platforms as complex adaptive structures.
“command& control”
-based platforms
complexadaptiveplatforms
Complex adaptive structure approach to platforms§ Platforms aim for continuous change and adaptability§ Linux, Wikipedia, Supercell, SSAB à Platform organizations
Decentralized governance structure.
Value is by definition shared meritocratically among all platform stakeholders without major power accumulation
But isn’t decentralization bad for money making??
1. “Command and control” has been the dominating organizing paradigm in platforms
2. State-of-the-art research leanstoward decentralization and value sharing.
3. Holistic perspective is needed to leverage the situation
Key messages of this presentation:
@villeeloranta www.linkedin.com/villeeloranta
Leveraging the extremes with a holistic perspective.
Holistic framework of different platforms
a fewfirms
eco-systemscale
Holistic framework of different platforms
“command& control”
-based platforms
complexadaptiveplatforms
§ Core: Protected resource (technology, data, etc.)
§ Centralized§ Builds lock-ins and inertia§ Leverages market pockets
(short-lived)§ Optimized for profits and
power
§ Core: Shared intent§ Decentralized§ Sharing of resources and
capabilities§ Prefers survivability over
short-term profits§ Optimized for adaptability
Holistic framework of different platforms
“command& control”
-based platforms
complexadaptiveplatforms
a fewfirms
eco-systemscale
Holistic framework of different platforms
“command& control”
-based platforms
complexadaptiveplatforms
a fewfirms
eco-systemscale
Holistic framework of different platforms
“command& control”
-based platforms
complexadaptiveplatforms
a fewfirms
eco-systemscale
Holistic framework of different platforms
“command& control”
-based platforms
complexadaptiveplatforms
a fewfirms
eco-systemscale
Holistic framework of different platforms
“command& control”
-based platforms
complexadaptiveplatforms
a fewfirms
eco-systemscale
Holistic framework of different platforms
“command& control”
-based platforms
complexadaptiveplatforms
a fewfirms
eco-systemscale
@villeeloranta www.linkedin.com/villeeloranta
Holistic framework of different platforms
“command& control”
-based platforms
complexadaptiveplatforms
a fewfirms
eco-systemscale
possibility for high profits, but risk of low adaptability
in rapidly changing environment
@villeeloranta www.linkedin.com/villeeloranta
Holistic framework of different platforms
“command& control”
-based platforms
complexadaptiveplatforms
a fewfirms
eco-systemscale
high adaptability, butvery challenging value
appropriation
@villeeloranta www.linkedin.com/villeeloranta
Leveraging the extremes.
Holistic framework of different platforms
“command& control”
-based platforms
complexadaptiveplatforms
a fewfirms
eco-systemscale
hybrid strategies combine platform
organization (survivability) and platform offerings
(short-term profits)!
Holistic framework of different platforms
“command& control”
-based platforms
complexadaptiveplatforms
a fewfirms
eco-systemscale
adaptableorganization
profits fromapp offerings
hybrid strategies combine platform
organization (survivability) and platform offerings
(short-term profits)!
Holistic framework of different platforms
“command& control”
-based platforms
complexadaptiveplatforms
a fewfirms
eco-systemscale
adaptability of theSDK developers
profits fromthe controlled app
marketplace
hybrid strategies combine platform
organization (survivability) and platform offerings
(short-term profits)!
Holistic framework of different platforms
“command& control”
-based platforms
complexadaptiveplatforms
a fewfirms
eco-systemscale
illustrativeexample
on how SSAB’ssteel material could be
integrated toindustrial platforms
adaptability fromopen material intelligence
communityhybrid strategies combine platform
organization (survivability) and platform offerings
(short-term profits)!
Alternatives:
1. Maximize profits2. Strive for survivability3. Leverage the extremes with a hybrid strategy
1. “Command and control” has been the dominating organizing paradigm in platforms
2. State-of-the-art research leanstoward decentralization and value sharing.
3. Holistic perspective is needed to leverage the situation
Key messages of this presentation:
@villeeloranta www.linkedin.com/villeeloranta
More readings…§ Eloranta, V. & Turunen, T. (2016). Platforms in service-driven manufacturing: Leveraging complexity by connecting, sharing, and
integrating. Industrial Marketing Management, 55. 178–186.§ Eloranta, V. & Turunen, T. (2015). Seeking Competitive Advantage with Service Infusion – A Systematic Literature Study. Journal of Service
Management, 26(3). 394–425.§ Eloranta, V., Orkoneva, L., Hakanen, E., & Turunen, T. (2016). Using platforms to pursue strategic opportunities in service-driven
manufacturing. Service Science, 8(3), 344-357.§ Eloranta, V., Turunen, T., Melgin, T., Hakanen, E., Töytäri, P., & Rajala, R. (2016), “Strategic Perspectives of Industrie 4.0 and Industrial
Internet”, in: Grubbström, R. W. and Hinterhuber, H. H. (Eds), Proceedings of 19th International Working Seminar on Production Economics, Innsbruck, Austria, pp. 137-148.
§ Hakanen, E., Eloranta, V., Töytäri, P., Rajala, R., & Turunen, T. (forthcoming). Material intelligence: Cross-organizational collaboration driven by detailed material data. Proceedings of Hawaii International Conference on System Sciences (HICSS).
§ Töytäri, P., Turunen, T., Klein, M., Eloranta, V., Biehl, S., & Rajala, R. (forthcoming). Overcoming Institutional and Capability Barriers to Smart Services. Proceedings of Hawaii International Conference on System Sciences (HICSS).
§ Töytäri, P., Hakanen, E., Eloranta, V., Turunen, T., Rajala, R., & Melgin, T. (2016), “Increasing information intensity in industrial service operations”, in: Grubbström, R. W. and Hinterhuber, H. H. (Eds), Proceedings of 19th International Working Seminar on Production Economics, Innsbruck, Austria, pp. 391-402.
§ Turunen, T., Eloranta, V., & Hakanen, E. (2015), “Leveraging big data in industrial service business – from protection to sharing and recombining””, in: Zhao, X., Zhang, J. and Han, H. (Eds), Proceedings of QUIS 14 – Accelerate the Impact of Service Research, Shanghai, China, pp. 946-955. (Honorable mention award winner)
§ Eloranta, V. (2016). Servitization, strategy and platforms. Aalto University, School of Science. Department of Industrial Engineering and Management. Doctoral Dissertation Series 74/2016. Helsinki.
@villeeloranta www.linkedin.com/villeeloranta
More informationDr. Ville Eloranta, Postdoctoral ResearcherDept. of Management Studies & DIEM, Aalto University
@villeeloranta www.linkedin.com/villeeloranta
[email protected], +358 40 706 7012