The creation of digital platform in the case companies is a natural consistency to emergent B2C platforms, which have become popular among their users and have disrupted many industries.
As emphasized continuously throughout this thesis, change is occurring in all of the industries, if not at this time, it will in the future, and companies should prepare for it. The interviewees are asked about how the external environment has influenced the creation of digital platform, and during the interview it is discussed what the company’s reaction and actions towards the opportunities have been both on organizational and managerial level. Company’s reaction to external environment emerged as a main theme throughout the interviews. The findings suggest few interesting areas to elaborate on such as how external environment proposes opportunities, company’s capabilities to react to opportunities, company’s capabilities to capture opportunities and lastly, company’s capability to reconfigure operations based on external environment.
Technology and digitalization
In both of the cases, technology and digitalization are seen as important drivers in digital platform integration. The reality is that every industry will be provided opportunities and threats caused by digital disruption, and the company can choose to take an offensive or defensive position. Both of the case companies have decided to acknowledge that technology will shape their industry and they need to act upon it. An interviewee with years of experience in a traditional company describes the influence of the technological change:
“I would say that of course in our industry but also kind of in the whole world. So we can see that every industry is being turned upside-down or fundamentally changed by different megatrends including technological disruption and our industry is no different.”
“A lot of these forces and changes that are happening are both threats and opportunities simultaneously. This upgrading of customer expectations, that can be a threat of course but it can also be a great opportunity if you can meet those and embrace them.”
One reason why technological advancement is pointed out, is that platforms have been becoming more popular among consumer and the ease of using platforms is emerging also on business side. The changes in consumer business is influencing the traditional B2B businesses through changing expectations of individuals. An interviewee with experience both in B2C and B2B platforms describes the opportunity as:
“In the consumer side, platform economy has been on the rise for a long time and there the expectations of the user experience have increased.”
“The growth of e-commerce web shops could be added too, which has been on-going for a long time, but maybe its increase in versatility from big to small, local to global, is one of the background factors.”
Capturing the opportunities
The common nominators between the case companies have been the technological advancements and trends that have emerged from it in their own way in the company’s external
environment. Although, the case companies’ industries are extremely different, both of them have been able to screen and assess what opportunities technology can offer for their business and what are the necessary steps to take in order to stay offensive rather than have to defend in the future. As the environment proposes opportunities for companies, they need to be open minded and assess what benefits or threats emerge from it. Although, neither of the companies’
competitors are seen to have influenced the integration of digital platform business, it is acknowledged that they want to stay ahead of competition and sustain their advantage.
When the opportunity has been noticed, a company has to find a way to capture the opportunity.
As mentioned, the platform as a result has not been as conscious decision as one might think.
The culture and attitude towards new innovations play an important role in generating new ideas. Additionally, if company has certain processes on how to take ideas forward help the process. Some interviewees state that there are certain processes developed in the company to capture opportunities:
“We have so to say basic processes, and it depends a bit whether it is a big or a little thing.”
“Depending on the opportunities, there are processes how to start testing.”
In both of the cases, the digital platform was not completely planned to be the end result. When companies started to reconfigure the existing processes and co-create with customer on how value could be created, the result was a platform. Also, simultaneous internal processes enabled platform development in the other case. An interviewee explains the birth of the platform:
”It didn’t originate in a way, which also happens, that hey let’s make a platform. So, it didn’t actually originate from that, rather it started by reasoning and then we realized that this is a platform or an opportunity for it.”
Based on the opportunities presented to the company by the external environment, both of the companies have started to reconfigure their operations to better serve the opportunity. The changes are connected to creating value differently and enabling the platform integration. The capability of changing the existing operations has been described more in chapter 5.4.
Nevertheless, this is mentioned here, because the need derives from noticing the opportunities and is a logical step to it.
These findings provide partial answers to RQ2: How do dynamic capabilities support the integration of digital platform business? Both of the case companies have been able to sense the opportunities from the external environment and further shape them to serve their business specifically. Companies’ internal, and often invisible, processes have allowed them to seize the opportunity by creating new business models by re-thinking the value creation and how to do business. These opportunities identified have not generated the end results automatically. The companies have had to specifically think what the opportunity means for them, their business and their industry. Additionally, these companies have been able to combine and reconfigure both of their intangible and tangible assets. It is important to note, that it is possible that a company knowingly exploits dynamic capabilities, or it just applies methods and processes that can be identified as dynamic capabilities. For the company to be able to build a digital platform and hence create competitive advantage, it needs dynamic capabilities to identify the opportunities and analyze what the opportunity can mean for their industry and their business.
On the other hand, in order to able to build the digital platform, the company must analyze value creation opportunities and possibilities for new business models. To conclude this theme, the process of change and digital platform integration starts from screening the external environment and megatrends. When a company wishes to start creating competitive advantage with the creation of a digital platform, the starting point is not in the decision to make a platform, instead the company should investigate the external environment and assess the opportunities and threats it proposes for their industry and their company. The company should enable a culture where it is able to act upon the opportunities. Moreover, the company’s management must understand that change is coming. An interviewee with extensive experience says, what every industry and company leader should be thinking:
“So, we can see that every industry is being turned upside-down or fundamentally changed by different megatrends including technological disruption and our industry is no different.”