Today, more businesses are moving their products to the cloud as part of their digital transformation strategy. In fact, as of 2022, almost 23% of businesses with advanced functionalities (multiple applications/products) have moved their workloads to the cloud.
As cloud adoption maturity grows and more companies migrate their IT infrastructure to the cloud, we’re witnessing a considerable shift from developing products to building platforms.
Companies like Google, WordPress, Airbnb, YouTube, Uber, and Facebook are among those successful platform businesses that testify to the power of this architectural prowess over the more traditional product-oriented approach.
But what has made these software companies take the leap from building standalone products to platforms? That’s a question worth putting to the test. But before we can do that, it’s essential to understand what a platform really is.
What Is a Platform?
A platform is a combination of multiple similar products of a business across various segments. A typical platform maintains a range of software products that can cater to different user needs, thus bringing in significant value and the much-needed competitive edge.
With a great platform, one can witness a vivid difference in the speed, cost, and efficiency of developing new software products. Because having a platform strategy eliminates the need to develop a product from scratch.
Gartner’s definition of “Cloud Management Platforms” reads excellent within this context. The consulting giant refers to them as “integrated products” that “incorporate self-service interfaces, enable metering and billing, integrate with external enterprise management systems, include service catalogs, allow for enhanced resource management, etc.”
All in all, a platform works to:
● Ease the collaboration between the different stakeholders
● Standardize the data among the various systems
● Increase the scalability and flexibility of all the systems on board
● Create a unified user experience across all the systems
● Improve performance of applications integrated with the platform
Why Companies Need to Transition to Platforms
Developing a standalone product every time the need arises can cost tech companies heavily. If they’re looking for a better monetization opportunity while developing great products, having an effective cloud platform strategy is the way to proceed.
Here are more reasons why businesses need to consider progressing from product to platform seriously:
Gain a Larger User Base
A platform offers more utility by catering to the needs of various user groups. The business can rest assured of attracting a wide range of stakeholders — ranging from developers to service providers to product users.Airbnb and Uber, for instance, are platforms that connect app users to service providers directly. Thus, they foster seamless collaboration between all the parties — creating a win-win for them.
Better Customization of Products
Customizing software products per the market requirements over a platform is comparatively easier than standalone. As the products are interconnected, once the product is tested over a platform, adding customized tools to it is far less complex and does not require testing from scratch.
Increased Revenue and Scalability
A self-explanatory benefit of having a platform strategy is the possibility of attracting a vast user base for different product segments. Additionally, developing products is cheaper with platforms due to lower manufacturing costs and a lesser need for extra resources, licenses, and tools.Besides, platforms can indefinitely scale in terms of the number of users, performance, and optimized software products.
Enables Collaboration and Data Sharing
Cloud platforms are built to enable increased collaboration amongst its tools and stakeholders. They communicate by sharing data and internal processes within the existing products. So, one needn’t integrate independent tools for each product on the platform.
A successful cloud platform strategy is not a lift-and-shift approach but a thoughtful, incremental approach to product development. Let’s dive into the elements that make up an effective cloud platform strategy.
Considering the Scope of Work and Resources
A multi-sided business model, like the platforms, requires more planning, additional resources, and a careful examination of the scope of work. Often, businesses may already have handy resources for product development, but they need to look into the available revenue and additional resources before implementing a clean platform strategy.
Sufficient Knowledge and Skilled Personnel
If the goal is to build a high-performing platform that generates more revenue, having dedicated teams with sufficient technical expertise is crucial. Developing user-oriented products or customizing features can be impossible without appropriate skills and understanding of requirements.
An Effective Toolbox and Technology Stack Selection
The tech stack and toolbox form the primary building blocks of any development. They could make or break the cloud platform’s development approaches.A tech stack or a toolbox involves a mixture of programming languages, frameworks, and tools. One must carefully select them by investigating factors like project requirements, complexity, product specifications, speed, budget, and more. No doubt, sound technical expertise can be highly beneficial for an apt selection.
A Centralized Data Lake
A cloud platform enables the use of a data lake which is a crucial element for optimized use of data storage, both structured and unstructured data. And more businesses are using these as they provide a basis for data analytics, visualizations, and artificial intelligence apart from storage options.As per Denodo’s survey, 48% of organizations consider data warehouses and data lakes as their “top initiatives” concerned with cloud adoption.Indeed, using centralized data lakes can be highly beneficial in cloud platforms and product development, as they are proven to facilitate scalable platforms. They are highly cost-effective and simplify data storage, processing, and management.
Using the discussed cloud platform strategy, you can considerably fast-track your go-to-market (GTM) strategy as there are lesser hassles, unlike developing a regular product. Since most collaborative tools and add-ons are already in place, new development takes relatively less time, with platforms enabling quicker GTM for your products.
The Bottom Line
Any business’s greatest challenge while transitioning to a cloud platform strategy lies in re-modeling their business processes alongside their priorities and evolving customer needs.
But as more companies move towards digitization, using a cloud platform strategy for product development is the need of the hour.
And it’s highly unfeasible to build a platform or have a strategy in place without proper guidance and technical expertise.
With a partner like Pratiti Technologies, you can leverage the platform advantage for your business and witness rapid growth. Get in touch with our in-house platform experts today!