Let’s Talk About the Cloud Platform Strategy in Product Development

Introduction

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.

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