Trend 3:

Platform
Economy

People First:
The Primacy of People
in the Digital Age

People First: The Primacy of People in the Digital Age

The Accenture Technology Vision 2016 identifies five technology trends fueled by the
people first principle and that are essential to business success in the digital economy.

Intelligent
Automation

Liquid
Workforce

Copyright 2016 A ccenture. A ll rights reserved.

Platform
Economy

Predictable
Disruption

Digital
Trust

New technology platforms are driving

business innovation, everywhere

Driving a geographic dispersion

of technology innovation hubs
Copyright 2016 A ccenture. A ll rights reserved.

Building these types of new platforms

requires starting from the ground up
This includes:
Technical Architecture
Governance
Security

How?
Create open standards and APIs to be
sharable and attractive to ecosystem partners.
Use a cloud foundation, technically
designed to scale with the network
effects of the ecosystem.
Copyright 2016 A ccenture. A ll rights reserved.

Back office systems will

need to support real-time
business models

SAP HANA real-time health

analytics and predictive medicine

As these ecosystems develop

more connections to mobile and
IoT devices, platforms need to
support real-time business models
and data architectures
Real-time is the basis for connected
intelligent machines, vehicles, and
mission-critical facilities
Key enabler = in memory
computing & databases

Copyright 2016 A ccenture. A ll rights reserved.

Real-time use cases abound in the consumer experience

and are rapidly expanding into all business sectors
Real-time use cases abound in consumer smartphone apps
Social/Facebook: share experiences instantly
Transportation/Uber: watch your taxi navigating toward you
Connected Car: infotainment and on-demand services
Chat apps: instant group communications with no latency
Smart home: the lights turn when you walk in the house
TV remote: change the channel from your smartphone

And are driving the next generation of mission critical systems

Healthcare: continuous patient monitoring hospital to home
Industrial: real-time management of $ billions of critical assets
Logistics: real-time tracking of every that moves
Energy: smart grid electricity usage, optimization, and security
Connected Car: emergency services alerted instantly upon collision
Transportation: driverless vehicles of all kinds
Copyright 2016 A ccenture. A ll rights reserved.

These new platforms also = adoption of New IT

Managing platforms and ecosystems of digital
partners and developers communities will drive
your New IT into high gear
Multi-speed
change engine

New IT extends into platform ecosystem

governance to support your ecosystem
Digital business partners
Developer communities
Cloud partners
Security partners

Architected / designed for continuous change

Agile (Release/Change Management):
DevOps (Process, People & Tools)
Testing (Rapid, Ecosystem-based)
Copyright 2016 A ccenture. A ll rights reserved.

By 2018, over 60% of

new apps will use cloud-
enabled continuous
delivery and cloud-native
application architectures to
enable faster innovation
and business agility.
IDC FutureScape: Worldwide
Cloud 2016 Predictions, IDC,
Doc #259840, November 4, 2015
8

Once in place, enterprises will use these

platforms as new types of business models
Platform business models are:

Products have features.

Platforms have
communities
Connected

Collaborative

Scalable

business strategies based on creating

value externally with communities of users,
partners, and developers
Copyright 2016 A ccenture. A ll rights reserved.

Marshall Van Alstyne

MIT Initiative of the Digital Economy
Co-author, Platform Revolution, (to be
released March 2016)

Using platforms is
the business model

Copyright 2016 A ccenture. A ll rights reserved.

10

Is anyone successfully doing this?

Market Cap Valuations
Internet vs. Platform Companies

Market Cap of Top 15 Public Platform Companies:

$2.6 trillion
Market Cap of Private Unicorn Companies:
$500 billion
TOTAL: $3+ trillion
Tech companies & born digital organizations
are dominating the digital economy with platform
business models.
Private venture-backed startups are also driving
record-high valuations:
More than 140 unicorns (private companies
with valuations of $1 billions or more) have
a total market cap of over $500 billion
(The Unicorn List, CB Insights, 2015)

70% of unicorn startups are platform companies

(Center for Global Enterprise, 2015)
Copyright 2016 A ccenture. A ll rights reserved.

+15,187.1%
$2,560,902
Internet
Companies
Apple
Axel Springer
Copart
Fox Communications
IAC/InterActive Corp.
iLive

Tech Companies
and Born- Digital
Organizations

1995

Alibaba
Alphabet
Amazon.com
Apple
Baidu
eBay
Facebook
JD.com
LinkedIn
Netflix

iStart Internet
Live Microsystems
Netcom Online
Netscape
PSINet
RentPath
Storage Computer Corp.
Wave Corporation
Web.com

2015

$MM

$16,752
Internet
Companies

Platform
Companies

Priceline.com
Salesforce
Tencent
Twitter
Yahoo!
11

Companies are using their platforms to lead in the digital revolution

As a leader in the digital revolution for
healthcare, Philips is launching Philips
HealthSuite platform with 3 tech partners:
Salesforce.com
Amazon IoT
Alibaba Cloud.
With a platform business model Philips is
driving new growth paths that complement
its core business in medical equipment.
The platform business model
lives alongside the traditional
product business
Copyright 2016 A ccenture. A ll rights reserved.

12

This is a big picture change

Traditional Value-Chain Business Models

Production

Distribution

Marketing

Platform-Driven Business Models

Developers
Publishers
Content
owners
Retail
Services

Consumer
Platform

Value creation is
linear and one-way
Copyright 2016 A ccenture. A ll rights reserved.

Ecosystem

Value creation is two-

way and continuous
13

Digital leaders from non-tech sectors

are now also building platforms
Having a platform strategy and the
business know-how to exploit it is more
important than owning an ecosystem.
By 2018, IDC predicts that more than
50% of large enterprises and more than
80% of enterprises with advanced digital
transformation strategies will create
and/or partner with industry platforms.1
IDC predicts that the number of industry
clouds will reach 500 or more by 2018,
up from today's 100-plus.2

Industry
Platforms:

Pfizer

Schneider

Novartis

GE

Merck

Bosch

Carepass

ABB

Cigna

Disney

edX

SONY

Walmart

Ford

American Express GM
Nasdaq OMX

TomTom

IDC Predicts the E mergence o f " the DX E conomy" in a Critical P eriod o f

Widespread Digital Transformation a nd Massive S cale Up o f 3 rd P latform
Technologies in E very Industry, IDC, November 4 , 2 015
2 Industry Cloud: The L argest V ertical G rowth O pportunity f or Technology
Vendors a nd S ervices Firms Through 2 025, IDC, November 1 9, 2 015
Copyright 2016 A ccenture. A ll rights reserved.

14

Platform Economy: 100-Day Plan

1. Appoint a C-level champion to lead a
cross-functional team of technologists,
business experts, and economists.
2. Identify and prioritize parts of the
business that are prime for platform
business models.
3. Identify the parts of the business that
are most vulnerable to attack by
disruption from new platform-based
business models (from incumbents and
startups inside & outside industry).
4. Align the platform opportunities
alongside existing product and market
strategies (platform business models
live alongside traditional product
strategies).
5. Present initial findings to the Board
and establish a top-down C-level
enterprise-wide commitment to
pursuing platform business models
as a strategic growth path.
Copyright 2016 A ccenture. A ll rights reserved.

6. Assess your knowledge gaps of the

new rules of business: demand-side
economies of scale, power law
distribution, network effects, and
asymmetric competition.
7. Launch a company-wide campaign on
the new rules of business and platform
business models. Create a network of
internal platform champions to
evangelize the message.
8. Assess your digital technology
capabilities and gaps in building
platform ecosystems.
9. Prioritize the overall opportunities and
threats, and then start with a small
initiative to pilot, including internal
initiatives to start the journey into
platform business models.

15

Platform Economy: 365-Day Plan

1. Finalize plans to launch the initial pilot to work with a cloud partner to build a
platform around one of the most information-intensive parts of the business.
2. Formalize agreements with the cloud partner that will be building the
foundation of the platform.
3. Develop a multi-phase plan to transform parts of the business to platform
business models.
4. Identify platform opportunities inside and outside your industry based on your
executive training programs and platform knowledge base.
5. Establish a formal governance plan and organization to manage digital
partnerships and developer communities in order to optimize the value of the
platform ecosystem.
6. Formalize an approach to track and report on platform growth opportunities,
relevant ecosystems, and competitive threats from both inside and outside
the industry.
7. Communicate the vision of where your company fits in an economy without
industry sector segmentation and with boundary-less competition.

Copyright 2016 A ccenture. A ll rights reserved.

16

Predictions

Immersive becomes Pervasive.

Businesses go beyond AR, VR and MR to create platforms on
which customers, employees and partners can experience all
the five senses together in any environment they choose.
This leads to the early stage of dematerialization where people
can be present virtually anywhere in the world at any time and
meet with their friends.

Copyright 2016 A ccenture. A ll rights reserved.

17

Key Takeaways

Driven by the new rules of

business, platform business
models represent the most
profound disruptive change in
the global macroeconomic
environment since the
Industrial Revolution.

Copyright 2016 A ccenture. A ll rights reserved.

The strategic use of technologies

to create platform business
models is driving unprecedented
growth opportunities in the
rapidly expanding
digital economy.

While tech and digital born

organizations have been
dominating the digital economy
with record-high market caps,
non-tech digital leaders across
all industries are developing
platform strategies now (the
new tech leaders).

18

Whats Next
Non-techs become next innovation giants. Within
3 to 5 Years, non-tech companies will emerge as
leaders of technology and business model
innovation, shifting power away from the traditional
tech and digital born organizations.
New geographic innovation hubs emerge. This
shift will inherently drive a geographic dispersion
of innovation hubs away from tech centers like
Silicon Valley to a variety of global hubs with
industry concentrations.
Ecosystems drive market caps. Within 3 to 5 five
years, market cap valuations will be largely based the
power of ecosystems and digital assets, including the
network effect of platform interactions and control of
key digital technologies such as algorithms and APIs.
Copyright 2016 A ccenture. A ll rights reserved.

19

Thank you
#techvision2016
www.accenture.com/technologyvision
Copyright 2016 A ccenture. A ll rights reserved.