MIT Sloan Management Review

Corporate Strategy, Management of Technology and Innovation

 

The Elements of Platform Leadership

By Michael A. Cusumano and Annabelle Gawer

April 15, 2002

With vision that extends beyond their current business operations or the technical specifications of one product, platform leaders can create an industry ecosystem greater than the sum of its parts.

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You would think that a company like Intel, which in 2001 provided nearly 85% of the microprocessors for personal computers, would feel relatively secure. But companies holding the keys to popular technology don’t live in a vacuum. In many cases, they are dependent not only on economic forces in the wider world but also on the research-and-development activities of partners. David Johnson, one of the directors of the Intel Architecture Labs (IAL) in Hillsboro, Oregon, goes so far as to call that reality desperate. “We are tied to innovations by others to make our innovation valuable. If we do innovation in the processor, and Microsoft or independent software parties don’t do a corresponding innovation, our innovation will be worthless. So it really is a desperate situation for us.”1

The Desperation of Being on Top

Although leading companies from all industries know that business in our interconnected world has become too complex for complacency, the issues are particularly clear in the information-technology industry. There, platform leaders (companies that drive industrywide innovation for an evolving system of separately developed pieces of technology) are navigating more frequent challenges from wannabes (companies that want to be platform leaders) and complementors (companies that make ancillary products that expand the platform’s market). To put their organizations in the best competitive position, managers need to master two tricks: coordinating internal... To read the complete article, login or sign-up using the form below.

 
 

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