Evolution of B2B Platforms in Industry

Guest: Marin Jovanovic

Bio: Marin Jovanovic is an Associate Professor at the Department of Operations Management at Copenhagen Business School and a Visiting Scholar at Luleå University of Technology. He holds dual Ph.D. degrees in industrial economics and management from the KTH Royal Institute of Technology and in industrial management from the Universidad Politécnica de Madrid (cum laude). His research focuses on the digital transformation of manufacturing, maritime, and healthcare sectors, platform ecosystems in the business-to-business (B2B) context, and artificial intelligence. He has published extensively in journals such as Organization Science, Journal of Product Innovation Management, Technovation, and Industrial Marketing Management. He also serves on the editorial boards of Journal of Product Innovation Management and Journal of Business Research.

Summary: In this episode, Marin Jovanovic discusses the evolution and characteristics of B2B platforms, contrasting them with B2C platforms. The conversation covers the peculiarities of B2B platforms, including data governance, network effects, transaction value, and the complexity of governance in multi-firm ecosystems. Marin also highlights the growing importance of data utilization, modular structures, and the emergence of generative ecosystems and meta-organizations in the B2B space. The discussion further explores the potential of AI in conjunction with platforms, particularly in the medical sector.

Key Discussion Points:

• Definition of Platforms in the B2B Context: Marin shares his journey into platform research, transitioning from servitization to industrial platforms.
• Main Findings and Peculiarities of B2B Platforms: The discussion highlights differences in network effects, the higher value but lower volume of transactions, and the increased awareness and demands of participating companies compared to B2C platforms.
• Data Governance in B2B Platforms: Key challenges include the complexities of data governance, revenue sharing, and the project-specific nature of agreements.
• The Role of Humans in Matchmaking: The conversation explores whether highly specific B2B transactions might require more human intervention in matchmaking rather than relying solely on algorithms.
• Cyber-Physical Integration: The importance of merging information systems and management in the context of autonomous solutions is emphasized.
• Challenges in Explaining B2B Platform Models: The barriers in conveying the concepts of B2B platforms and ecosystems to managers, using the example of 5G technology, are discussed.
• Modularity and Generative Ecosystems: The significance of modularity in both architecture and management for fostering flexible and reconfigurable B2B ecosystems is highlighted.
• Open Innovation and Open Organization: The discussion connects B2B platforms to concepts of open innovation and broader organizational collaboration.
• Microservices and Ecosystem Envelopment: The relevance of microservices for customization and the increasing convergence of platforms into "platforms of platforms" or meta-organizations is explored.
• Data Monetization in B2B: The potential for companies to sell and leverage data, drawing parallels between B2B and B2C models with examples like smart cities and business analytics, is discussed.
• Physical Assets as Pivots for B2B Platforms: The idea that valuable physical assets owned by companies can serve as the core of B2B platforms, using the concept of "solution enabler platforms," is examined. Different types of B2B platforms based on control and decision rights, such as consortium platforms and algorithmic governance, are also introduced.
• Future Research Focus on AI and Platforms: Marin shares his current research interest in the application of AI in specific sectors like medical technology and how AI solutions interact with existing hospital systems and potentially aggregate on platforms.

Publications & Projects Mentioned:

• Porter, M. E., & Heppelmann, J. E. (2014). How smart, connected products are transforming competition. Harvard Business Review, 92(11), 64–88.
• Jovanovic, M., Sjödin, D., & Parida, V. (2021). Co-evolution of platform architecture, platform services, and platform governance: Expanding the platform value of industrial digital platforms. Technovation, 102218. doi:10.1016/j.technovation.2020.102218.
• Sjödin, D., Parida, V., Jovanovic, M., & Visnjic, I. (2020). Value creation and value capture alignment in business model innovation: A process view on outcome-based business models. Journal of Product Innovation Management, 37(2), 158–183. doi:10.1111/jpim.12516.

Links:

• Marin Jovanovic’s research blog: Industry Platforms Research.