Platforms & Openness

There is a rush currently underway in business to become a platform company – provider of an ecosystem. Platforms make intuitively good business sense. The openness of a platform attracts many more participants who either by their presence or their expertise (often both) enhance the base value of the platform. And the platform always gets paid for the facilitation. Consider the Kindle platform of Amazon for example – writers, publishers, readers using the platform pay Amazon for either end of the reading transaction (Kindle is not such an open platform really though writers can self publish on it – perhaps Salesforce is a better example. But you get the drift)

Primary and most significant cornerstone of a platform offering is its openness. That is what attracts participants and builds out the ecosystem at scale. Viewed differently, openness is also a culture. This unique intersection of culture and business model is what makes successful platform companies. If the internal culture of a company is that of opacity, parochialism and fights over turf it is very likely the company will bring the same behavior in the way they run the platform. This pisses off participants (like Facebook a few years back was alienating “partners” by building out on their core platform what the partners were bringing in to the ecosystem. This is – besides plagiarisation – a culture of turf build out, which leads to a culture where no one shares anything for the fear of the idea getting stolen). Once partners on a platform shy away, there is no way the firm can reap benefits of providing the platform at scale. The consequence is mostly a regression into becoming a product company earning one time license fees

Remember the saying – culture eats strategy for lunch? It is true. If you are aspire to becoming a platform company ensure the cultural revolution of being more open, collaborative and tolerant (even for disruptive ideas) starts happening closer home

 

Small and Medium Aspirations

Small and Medium Enterprises (SMEs) represent the vast middle earth in the Indian business ecosystem. And as I write this, a gruelling war is getting fought by a multitude of firms to win this middle earth. Win relationships, win mandates, win contracts, win engagements – all so that when these SMEs become adults, businesses who have won now have prominent seats at the table

In a way we think of SMEs as a different class of businesses altogether. During a requirement analysis phase – for building a product or a service – the trap is in hastening to believe that SMEs have very unique businesses issues and try solving them. Quite the contrary – SMEs most often have the same set of challenges that large established players have. So rather than focusing on the challenges of SMEs, a better approach is to focus on their aspirations. Every small and medium business wants to become like – and be treated like – the big guys. The last thing they want is a condescending salesperson turn up at their doorstep and explain how – almost out of pity – they put together a product or solution for them

If a business is serious about serving SMEs it needs to work to help the SME get rid of that very tag. Help the small business to become as competitive – if not more – than the big business. Help the medium sized business break through the growth ceiling. In short, do just two things – one, align to aspirations and, two, help the Davids beat the Goliath (yes, even if Goliath happens to be your client)

Simply Steve

Aha, Mr. Steven Jobs. Welcome Sir. I daresay the world has gone into a mourning with your untimely death. And we are trying to understand why”. St. Peter’s at the Pearly Gates was both anxious and curious as he welcomed the technology magician
“Quite Simple”, said Jobs. “Let me show you” – and he unslung his backpack and took out a handful of Apple products and laid them out
“That’s it?”
“Yeh, that’s it. Sorry if you were expecting more but I guess you have to wait for some more while for that. Not until Bill shows up”, Jobs chuckled as he took a dig at his favorite punching bag

I woke up the news that Steve Jobs is no more. Pages of flowing eulogy has already gotten written by authors who are better and people who were lucky to have had personal run-ins with the great man. So I will, like Jobs’ product portfolio, keep this a short affair.

And Simple

If there is one lesson Jobs taught us businessmen it was simplicity. Simplicity in business models, simplicity in portfolios, simplicity in design and simplicity in commercial models. The world is already far too complex and evolution isn’t exactly an accelerated science – which means people in this world have far more deconstructions to handle than expect to have to do the same with technology. Technology whose calling card promised to make life simple in the first place. Jobs’ business played purely to that feeling. In world where everyone was designing with the SUV Syndrome, Steve Jobs discarded layer after layer of complexity to finally reach the core. And then he drew as few concentric circles as he could. Doing less is not a sin, doing more – and spectacularly complicating things, is.

With this knowledge, what would you do to your product? To your business? And to your life?

PS: This post is my tribute to Steve Jobs. I wrote in on Pages on my i-pad 1 and posted using the WordPress app. Thank you, Steve. I know it’s tough, but try to get some rest Sir.

Playing in a Sandbox

What if LinkedIn decided to play in Facebook’s sandbox? Afterall, both are about creating social connections and sharing networks & information within that social circle.

The answer to the choice lies in aspirations. A newbie firm wants to test the waters and looks at the path of least resistance. A social business, they might argue, has got to mostly do with people. So why not gravitate to where most people are? The trouble with this is that the answer is correct but the question is wrong. The fabric of a social business is not the people per-se but what those people do within the sandbox. A social sandbox is like a society – and people get enamoured by reciprocating behavior as much as they put off by actions that seem incongruent to that sandbox-society. Example, notice how many times your eyes roll-over when you notice someone posted that “my cat’s just rolled over” type update on LinkedIn?

The sandbox you choose has got to answer a very important question. If you were given the choice of asking the entire population of your intended audience live inside a gated community what would that community look like? If that looks like Planet Facebook, please go ahead and play in that sandbox. But please ask yourself this question before you make the choice

PS: LinkedIn was a poor example perhaps – it had critical mass – and a different sandbox already as Facebook started its own growth. But you get the drift. Branchout is a better example and they made a choice of playing in Facebook’s sandbox

Of Embargoes and Selective Scarcity

My first career was as a spot FX (foreign exchange) trader on a corporate treasury desk. Esoteric theories I had learnt at business schools around currency pricing very quickly went out of the window (for a strange reason, our dealing room did not have windows, but that’s not really the point). The ubiquitous volatility of the trading day however seemed to take a breather around 5:30pm India time (around when my boss would go down for a smoke) – a mere pause before the madness resumed in doubled frenzy just after 6:00pm. Precisely at 6:00pm, which was 8:30am EST, the US markets released macroeconomic/monetary data that traders instantaneously interpreted and positioned themselves to trade accordingly. I later learnt that journalists were all herded into a room ahead of the news release, given copies of the about-to-be-released data to digest but they could only wire out the information (and analysis if any) at 8:30am IST. This was the information embargo

Institutions mostly apply embargoes on news and research for different reasons. Non scoop: Ensuring one news agency cannot “scoop” the news ahead of others. This is particularly important if the news has potential to cause a major disruption of status quo. Client protection: Applied in case of research, premium client engagement conditions might dictate that the wider distribution happens after a period that allows premium clients to digest the content.

Embargo, looked differently, also allows the creator of the embargo control the subsequent distribution (news is just a special case – my intent here is to generalize). For example, Department of Labor releasing US non-farm payroll data embargo at 8:30am EST ensures that all wires – all of them – write about it precisely at that hour, creating a critical mass, rather than fragmented reporting. Same goes with film reviews coming out on a Friday morning after special screenings on Thursday nights

Technology – both software and hardware – has started with embargoes (in a different way, though). Premium agencies – like All things D, Techcrunch, Wired etc – get advanced versions of gadgets they write on.  What if commonly downloaded software had embargoes? Several people could download it and use teaser versions before all of them got authorized at a precise time. It will allow creation of a crescendo that culminates in the same news-styled time-synchronized buzz. The software creator could actually control the period and pitch of the crescendo by creative releases of used features. I wonder if this approach has ever been tested with software

On the other hand, creating a non-synchronized embargo (kind of a carefully-careless embargo design) is interesting. This is where a software releases selective features to users depending on their usage. So it will be likely that two users will see, during the embargo period, different features of the software attuned to their usage. Imagine the social media going crazy with “hey, my version of <insert software name> allows me this, how come yours cannot” and “oh, hell, why on earth can I not do what you seem to be doing with your <insert software name>”. Yes, it will be crazy, but it will be fun. And it will start a conversation going

Now, the LinkedIn Walled Garden

Professional networking site LinkedIn announced on 6th April something that Facebook had done a while back. LinkedIn was opening up its platform to developers

A platform company has the luxury of creating an illusion of openness. There is a term for it too – walled gardens. You are free to plant a tree, trim the bushes and grow some vegetables but all within the confines (or constraints) defined by the wall. The platform company, LinkedIn for example, provides the markup language that defines what you could do – maybe on your website – with their assets.  If that asset happens to be people, profile and their social behavior then the platform company is sitting on a proverbial gold mine. People – and social relationships – are ubiquitous. It is difficult to imagine a web service that does not have – or would not benefit from – some analysis of people, perhaps their members or people they refer to in stories or people that comment on their website – the list can be endless

I had written a post sometime back about how Facebook and LinkedIn seemed to be converging in terms of how people were using it. The two platforms continued to nudge – knowingly or otherwise – users in the path convergence with features like “what’s in your mind” (LinkedIn) and polls (Facebook). Indulging in some amount crystal ball gazing, the evidence of trend seems to imply that open social networking and institutional social networking will find their own spaces. In other words, time will see the emergence of specialized social networking. Think of a social network of medical professionals, researchers and investors that have interest in commodities and so on. Open social platforms have the right technology to diversify their ad-centric and premium membership (in case of LinkedIn) business to platform walled garden initiatives, but they were never designed to be specialized networking venues (This has worked, in a way, against LinkedIn earlier. While LinkedIn had “Answers” for a while, it never was able to offer what a StackOverflow could. Or for that matter Quora, which incidentally I think is a touch overrated)

Keep a keen eye on how social network platforms evolve. And watch out for firms that leverage the APIs to create innovative extensions

Picture courtesy: LinkedIn Developer website

+1? I don’t Quite Think So

While a sizable proportion of world population was watching two sub-continental teams battle it out for the ICC Cricket World Cup, the folks at Google were doing a +1 (for those who don’t know, “+1” is digital shorthand for “that is cool”. I have seen many do a +100, especially on Twitter, which I extrapolate to “that is 100 times cooler”. But you get the drift). So here is what Google will do with “+1”.

As you see results of your search, you will notice a “+1” icon next to the results. You could, depending on how useful you found a particular link, click that “+1” button and in a way vote that link up (you can instantly undo a “+1” too). Now say your friend Jason also was searching for the same (or similar term) and your “+1”-ing of a particular search result will get highlighted to him in the results he gets to see.

In a way this is Google’s way of overlaying a social graph on search results, which is where the world seem to be going. Opinion however is divided on whether it makes sense to overlay the search on social graph or vice versa (I am partial to the former part of the argument). Here is a rather quick analysis of Google’s +1 strategy

  1. This is not new. Remember, Google used to allow users to “star” search results – that is, one could vote up a particular result in terms of relevance. The “+1” strategy in a way expands that, bringing in a social angle (Update: It seems Google has withdrawn that feature. However, I could still see a yellow star against some of the old search results I had previously upped)
  2. The success of Google’s “+1” depends on the strength of its social platform, which by any indication is quite weak. It failed to do much with Orkut, which has been obliterated by Facebook in user acceptance. Buzz landed up in a confused state and has remained that way till now, unsure of where it belongs in Google’s social assets and strategy. The bottomline is that not many use Google as their social platform for the company to be able to show the most socially relevant searches to an user in “+1”
  3. Google can however do smarter things with “+1” using GMail as lever. With the ability to snoop on our GMail messages and GTalk activity, it can not only understand some of our social relationships (not to the extent that Facebook can, though) and the strength of nodes of our social graph. That information can be brought back to enhance the +1 experience. It could do the same through Google Reader, bringing back to “+1” the sharing activities that it allows within the RSS Reader.

The long and short of this is that Google has a fair amount of assets to become a serious player in social search. It however starts with the disadvantage of having to build the social graph as an afterthought to its core strength of search.