A Platform Strategy Won’t Work Unless You’re Good at Machine Learning
Harvard Business Review | May 14, 2018
By Megan Beck and Barry Libert
Platform business models are booming—becoming bigger and more powerful than ever. Just consider that a few tweets from the president caused Amazon’s market capitalization to fall by about $40 billion, or that Russian influencers were able to reach 126 million people through Facebook. At OpenMatters, we spend a lot of time studying network orchestration—business models where companies facilitate relationships and interactions, rather than serving up all the products, services, and pieces of content themselves. Think Facebook, Uber, Pinterest, Alibaba, Airbnb, and the myriad “unicorns” that are being showered in investor dollars. These companies are groundbreaking, leveraging networks effects and near-zero scaling cost to trounce competition or define new markets. However, not all platform plays work—the business model alone isn’t sufficient for success. There are lots of things that can make a platform succeed or fail, of course, but an increasingly central aspect of a successful platform strategy is machine learning.
