Business Model Innovation

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Platforms That Grow Are More Than Matchmakers

  • Frontiers

  • Research Highlight
  • Read Time: 8 min 

Platform businesses, like Airbnb or Lyft, often talk about themselves as if they’re merely matchmakers. That’s a smart pitch — when a company is negotiating with investors. But any platform that wants to succeed will have to learn something Airbnb did: Matchmaking isn’t everything. Success also depends on identifying and mitigating risks for your buyers and sellers. The quantity and quality of goods or services bought and sold on your platform will be proportional to the amount of risk mitigated.

Why Companies Need a New Playbook to Succeed in the Digital Age

  • Blog
  • Read Time: 4 min 

In the digital world, companies need to become a destination for customers. The key is using digital as differentiation and offering customers something compelling. This requires a new playbook for how to do business as well as new ways of engaging customers. The trend is for individual and business customers to prefer just one or two powerful ecosystems in each industry, raising the stakes for leaders to better understand their options and clarify their own game plans.

Why Some Platforms Are Better Than Others

Executives often look at the network effects of digital platforms as a key source of competitive advantage — without understanding that platforms need to also leverage other factors at play in the local markets and among preferred customers. Network effects can help, but on their own, they offer very limited competitive value.

Surviving in an Increasingly Digital Ecosystem

  • Research Highlight
  • Read Time: 5 min 

Companies today will have to reinvent themselves to survive, and every large and ambitious company should be trying to figure out how to become a destination for its customers. Consumers are voting with their mobile devices and choosing from a handful of dominant “ecosystem drivers”— businesses such as Amazon and WeChat, which become destinations for their customers’ needs by offering complementary or sometimes competing services — for each domain in their lives.

For a Return on Platform Investment, Focus on New Capabilities

  • Blog
  • Read Time: 5 min 

Business success today requires taking part in open platform ecosystems. But too many world-class product and services companies find their platformization quests narrowly defined, and end up with constricted or conflicted implementations. The ability of information systems and devices to exchange data isn’t enough in and of itself. Instead, developing new capabilities is the key to platform innovation that will add value to an organization.

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All Platforms Are Not Equal

  • Frontiers

  • Research Highlight
  • Read Time: 12 min 

The emergence of a handful of high-profile virtual monopolies built on digital platforms has directed a huge amount of attention to the network effects such platforms fuel. But not all platforms are equally powerful. There is a reason why Airbnb is a better business than Uber.

Reshaping Business With Artificial Intelligence

Disruption from artificial intelligence (AI) is here, but many company leaders aren’t sure what to expect from AI or how it fits into their business model. Yet with change coming at breakneck speed, the time to identify your company’s AI strategy is now. MIT Sloan Management Review has partnered with The Boston Consulting Group to provide baseline information on the strategies used by companies leading in AI, the prospects for its growth, and the steps executives need to take to develop a strategy for their business.

Platform Sprawl Leaves No Industry Behind

  • Blog
  • Read Time: 5 min 

A decade ago, Apple’s iPhone cornered the mobile phone market by developing a platform interface that expanded its product from a simple one-task tool to a multitask utility. Using platforms to gain competitive advantage is no longer unique to Apple — it is happening in other industries across the board as readily available platform options grow in number.

Building a Winning Business Model Portfolio

Many companies today are operating several business models at once. But despite the potential that business model diversification has for generating growth and profit, executives need to carefully assess the strategic contributions of each element of their business model portfolio.

The Silicon Valley Caravan: What Sets the Tech Upstarts Apart?

For tech giants and startups alike, Silicon Valley success is grounded in core business values and processes rather than technological know-how — with a unique twist. Tech businesses have made a commitment to flexibility that allows them to reshape their business models to the needs of an ever-changing digital environment, which gives them an advantage over less-adaptable traditional companies.

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What You Need to Know Before Starting a Platform Business

There’s a great deal of enthusiasm about platform strategies these days. Entrepreneurs pitch their startups as the next Uber, the next Facebook, or the next Airbnb, while executives in established companies are retooling their strategies around platforms to drive growth and compete digitally. But creating a successful platform business is not easy — as economists Richard Schmalensee and David S. Evans explain in this MIT Sloan Management Review interview.

Analytics as a Source of Business Innovation

The 2017 Data & Analytics Report by MIT Sloan Management Review finds that the percentage of companies deriving competitive advantage from analytics increased for the first time in four years. Incorporating survey results and interviews with practitioners and scholars, the report finds that companies’ increasing ability to innovate with analytics is driving a resurgence of strategic benefits from analytics across industries. The report is based, in part, on MIT SMR’s seventh annual data and analytics global survey, which includes responses from 2,602 business executives, managers, and analytics professionals from organizations located around the world.

Free Webinar: Building a Business Creation Engine

  • Blog
  • Read Time: 1 min 

MIT SMR coauthors Clayton Christensen and Derek van Bever discussed their recent article, “The Hard Truth About Business Model Innovation.” They explained how understanding the stages of business model development is crucial to creating a successful process for repeated innovation.

The Next Wave of Business Models in Asia

The first wave of innovation from emerging markets in Asia has been predicated on the replication of existing business models at lower cost. The second wave, which could be even more disruptive than the first, fundamentally reimagines various facets of the business model to find new, often digitally enabled, ways in which resources and processes can be leveraged. Such companies identify creative ways for partners, stakeholders, and customers to be involved in value creation and capture.

Do You Have the Will for Digital Transformation?

Research shows that successful digital transformation does not require secret digital knowledge; it simply requires the boldness to recognize that digital transformation is occurring and to begin trying to adapt your business to account for and capitalize on these trends.

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Free Video Panel: Creating a Data-Driven Enterprise: Real-Life Cases

In a video panel and Q&A, MIT SMR editors discuss key insights from a recently completed series of in-depth case studies on how prominent organizations are using data and analytics to transform their operations. They review Intermountain Healthcare, GE, Nedbank, and the City of Amsterdam’s efforts to become more data driven. This set of diverse organizations offers a unique perspective on the challenges and opportunities associated with becoming a data-driven organization.

The Hard Truth About Business Model Innovation

Attempts at business model innovation have led to both repeated failures as well as seemingly inexplicable successes — and few formulas to help guide business leaders. Yet a study of both failures and successes shows that the journey to successful innovation is predictable, although “travel time” differs by industry and circumstance. The manager’s dilemma is to identify whether the journey is one the company wants — or needs — to take.

The Sustainable Tactics You Don’t Know, But Should

Businesses looking for sustainable business models need a strategy, but there are plenty of useful tactics available. As part of our series on building abundant enterprises, we look at regenerative marketing and collaborative exchange — just two in a list of 15 possibilities.

Managing Tensions Between New and Existing Business Models

Exploring new business models may be a good way to stay competitive, but doing so can create tensions internally, in areas such as organizational structure and competition for resources. Companies exploring business model innovation may not recognize the inevitability of these tensions and thus be poorly prepared to manage them. But understanding these issues may lessen some of the organizational challenges associated with business model innovation.

Showing 1-20 of 59