As high-tech industries become increasingly modular and interconnected, in an age when it's in just about everyone's interest to innovate, a new kind of leader is emerging: the platform leader, a company that provides the technological foundation on which other products are built.
Clearly, the most successful companies are those that orchestrate industry-wide innovations to support their products and others'. By definition, platform leaders who succeed can exert a strong influence over the direction of innovation in their industries and thus over the network of firms and customers - the "ecosystem" that produces and uses complements. But not all industries are suitable for platform leadership strategies. The dynamics that make it possible occur only under certain conditions: when the firm's product has limited value when used alone, but gains value when used along with complements. That's why becoming a platform leader today is like stumbling upon the Holy Grail - many seek it, but few achieve it.
High-tech strategy experts Annabelle Gawer, INSEAD Professor of Strategy and Management, and Michael Cusumano, Professor of Management at the MIT Sloan School of Management, present a framework for designing and implementing a successful platform strategy. Based on several in-depth case studies an incisive analysis, they explain how Intel, Microsoft, and Cisco (the head-of-the-class in platform leaders) established themselves and grew to dominant positions. They also profile Palm, NTT DoCoMo and Linux, labelled as the "platform leader wannabes." The authors hold each one up to discussion that hinges upon four levers of platform leadership: scope of the firm, product technology, external relationships and internal organization.
Harvard Business School Press, 2002