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Who Ubers Who: What Every Strategist Needs to Know About Digital Competition
@sramjiSam Ramji, CEO
Cloud Foundry Foundation
Continuous Innovation and Digital Platforms
The End of Competitive AdvantageContinuous InnovationCloud Native Applications
Continuous Delivery of Business Value
Digital PlatformsEnterprise API Platform
Platform Business Model
The Dawn of a New Era
Internet All The Things
A shift in business matchingthe shift in human behavior
Since 2000, 52% of the Fortune 500 are no longer
on the list
Continuous Reconfiguration
Options Valuation
Constructive Disengagement
Innovation Proficiency
Amazon
Netflix
Allstate
GE
Lockheed Martin
Continuous InnovationContinuous DeploymentContinuous Integration
Continuous InnovationContinuous DeploymentContinuous Integration
waterscrumfall
PAIRcloud native applications
WITHcontinuous delivery of business value
waterscrumfall
Microservices
Containers
12-Factor Applications
cloud native applications
Ephemeral
Scalable
Agile
cloud native applications
Run in the cloud
Support any client device
Connect to legacy data and processes via APIs
cloud native applications
Enterprise
Services
Legacy Systems
IBM Watson
PivotalAnalytics
Right-sizing digital innovation
Focused on cycle time optimization
Smaller teams and faster tools
continuous delivery of business value
Two-pizza teams
Silo-breaking
continuous delivery of business value
“Any organization that designs a system (defined broadly) will produce a design whose structure is a copy of the organization's communication structure.
Melvyn Conway, 1967
continuous delivery of business value
“When looking to split a large application into parts, often management focuses on the technology layer, leading to UI teams, server-side logic teams, and database teams. When teams are separated along these lines, even simple changes can lead to a cross-team project taking time and budgetary approval. A smart team will optimise around this and plump for the lesser of two evils - just force the logic into whichever application they have access to. Logic everywhere in other words. This is an example of Conway's Law in action.”
James Lewis and Martin Fowler, “Microservices”
continuous delivery of business value
dev+ops
continuous delivery of business value
waterscrumfall
continuous delivery of business value
Stories Chat Dashboards
continuous delivery of business value
Containers Automation Cloud Management
runC
continuous delivery of business value
Currently shipping
appfog
digital platform = APIs
Amazon’s pace of innovation is blistering
Amazon’s baseline issharing by default.
All teams will henceforth expose their data and functionality through service interfaces.Teams must communicate with each other through these interfaces. There will be no other form of inter-process communication allowed: no direct linking, no direct reads of another team’s data store, no shared-memory model, no back-doors whatsoever. The only communication allowed is via service interface calls over the network.It doesn’t matter what technology they use. All service interfaces, without exception, must be designed from the ground up to be externalizable. That is to say, the team must plan and design to be able to expose the interface to developers in the outside world. No exceptions.Anyone who doesn’t do this will be fired. Thank you; have a nice day!
“Jeff Bezos
CEO, AmazonSource: “Steve Yegge’s Rant”
The new baseline issharing by default.
“An architecture to move at the pace of change.”Key pillar of innovation strategyFuture proofs existing assetsMakes AT&T network into a platform and addressable by other innovatorsCreates permeability
“[The API program] is an architectural choice one makes for speed.”
John Donovan, Sr. EVP, Technology and Network Ops, AT&T
“If you have infrastructure assets and are going to operate at a pace at which the external market is moving, you have to take capabilities—industry-specific or not—and make platforms from them.”
John Donovan, Sr. EVP, Technology and Network OpsAT&T
“We’re pivoting toward architecting everything we do in an API-centric way.”
Jacob Feinstein, Sr. Director, Core ITAT&T
The new baseline issharing by default.
Nike 2006
Nike 2013
AT&T 2010
AT&T 2014
GE 2011
GE 2015
Nigel Fenwick & Martin Gill (2014),
“The Future Of Business Is Digital,”
Forrester Research
Platform Business Models
Platform Business ModelsiTunesiOS
Platform Business ModelsGoogleGoogle+
Platform businesses are built on network effects.
The more network effects, the stronger the platform.
Kindle
User Book
PSP
User Gam
Zune
User Music
MicrosoftSonyAmazon
Eisenmann, Parker, Van Alstyne (2011), “Platform Envelopment,” Strategic Management Journal.
MP3
User Music
Video
TV
Games
Dev
Web
HTML
eBooks
Pub
Calls
User
Apple
VS.
VS.
VS.
VS.
VS.
VS.Parker, Van Alstyne, and Choudhary (2014)
Eisenmann, Parker, Van Alstyne (2011), “Platform Envelopment,” Strategic Management Journal.
Eisenmann, Parker, Van Alstyne (2011), “Platform Envelopment,” Strategic Management Journal.
Openness is a critical element of all platform businesses.
Eisenmann, Parker, Van Alstyne (2011), “Platform Envelopment,” Strategic Management Journal.
V4V3
Price
q1
p1
Quantity
V1V2
Platform sponsor gives away platform value.Partners build apps for installed base, adding new layers of value.Platform sponsor benefits from increased sales & royalties.Partners benefit from cost savings and installed base.
Parker, Van Alstyne (2011), “Innovation, Openness & Platform Control,” SSRN.com.
Platform models generate profit through first and third party usage.
Most firms can only concentrate on most
valuable apps
Profits increase when others add to
platform’s “Long Tail”
Parker, Van Alstyne (2011), “Innovation, Openness & Platform Control,” SSRN.com.
Platform models build digital ecosystems through virtuous cycles.
[Ecosystem Competition]
Kishore S. Swaminathan (2009), Chief Scientist, Accenture
In closing
Empirical Approach to Digital Transformation
Continuous Innovation
Digital Platform
Further reading:
The End of Competitive Advantage (McGrath)http://12factor.net (Wiggins)Migrating to Cloud-Native Application Architectures (Stine)Microservices (Fowler)Platform Revolution (Parker, Van Alstyne, Choudhary)The Power of Pull (Hagel, Brown, Davison)
