The Rise of Platforms and Digital Ecosystems in the ‘Sharing Economy’
Digital transformation has been at forefront of many organizations’ strategies in recent years and continues to be a critical factor for business success in the year ahead. Companies have been increasingly integrating their core business functionalities with third parties and their platforms, building a digital environment to grow revenue. However, the manner of execution could be shifting towards a new paradigm of platform-based business and technology innovation.
Born digital platform companies such as Amazon and Uber have built a multi-billion-dollar business at a never-before-seen speed in the corporate world, disrupting industry after industry with their platform business models and challenging some of the long-established companies in their field. We are witnessing a fundamental shift in how business and technology is shaping up. The secret to success has been an ability to execute on platform-based digital businesses backed by building unique technology platforms that are intelligent, open, connected and scalable.
The innovation has been to move from a traditional ‘pipe’ based approach, where business co-ordinated activities such as, sourcing raw materials through manufacturing, distribution, customer sales and service, to a business platform one, where the business becomes the enabler in a connected ecosystem of customers, vendors and partners that can efficiently exchange value between themselves. Establishing a digital ecosystem helps businesses build connections between people, departments, organizations, partners, adjacent industries – and even the competition.
Ecosystems help companies get closer to customers. An interconnected platform has the added capability of gathering and analysing huge amounts of data generated by the ecosystem to enable more intelligent transactions and decisions to be made i.e. customer and vendor reviews, personalised recommendations, offers and predictive supply. Companies are either creating the ecosystem or are trying to become a part of an existing ecosystem to help fill the gaps in their offerings.
Platforms will also pave the way to new and unexpected business opportunities. Take for example the increasing use of enhanced multi-device, multi-channel connectivity, mobile, IoT and big data functionalities - these will become far simpler to implement and integrate over the Cloud. The scale and flexibility on offer will also make it possible to build and innovate on existing business processes far more easily. New partnerships can be formed with the successful ones allowing businesses to prosper and grow together in the long-term, through the easier integration of services. Going it alone can no longer be considered an option. In fact, we believe the Platformation™ * framework will become the de-facto standard for balancing business and technology requirements to achieve platform-based digital transformation.
Doing all of this might require complete re-imagining of a business with advanced technologies and design thinking for business model and process innovation Whether you decide to do this internally or with an outside partner the technology leader tasked with making it all happen i.e. the CIO, CTO or CDO of the organisation, has to be in lock-step with the approach – it’s better to know early before everyone heads in different directions.
On a cautionary note, operating in this kind of an environment, raises the spectre of data leakage. It’s important to take steps to stay secure. Clear boundaries and open communication with partners are critical as are the protocols adopted and the type of information shared.
If businesses are to remain relevant and flourish in the sharing economy they will need to rapidly improve their understanding of platform-based digital business and technology transformation initiatives. It is little wonder that the S&P 500 is expected to have more than thirty platform-based players by 2020, representing some of the largest and fastest growing companies on the index. According to Gartner’s 2017 CIO Agenda report, 79 per cent of top-performing digital organisations participated in a digital ecosystem. By comparison, fewer than half of the companies rated as average operated in a digital ecosystem.
The opportunities are limitless if we can execute on the concept of platforms underpinned by digital ecosystems. The ‘sharing economy’ will blur the lines between industries and even competitors, and has the potential to shape entire markets that are better connected and more efficient.
Tridip Saha, Head of Business-Europe, Sonata Software
ICO warns of privacy concerns on the use of LFR technology
“I am deeply concerned about the potential for live facial recognition (LFR) technology to be used inappropriately, excessively, or even recklessly. When sensitive personal data is collected on a mass scale without people’s knowledge, choice or control, the impacts could be significant,” said Elizabeth Denham, the UK’s Information Commissioner.
Denham explained that with any new technology, building public trust and confidence in the way people’s information is used is crucial so the benefits derived from the technology can be fully realised.
“It is not my role to endorse or ban a technology but, while this technology is developing and not widely deployed, we have an opportunity to ensure it does not expand without due regard for data protection,” Denham added.
The Information Commissioner’s Office has said it will work with organisations to ensure that the use of LFR is lawful, and that a fair balance is struck between their own purposes and the interests and rights of the public. They will also engage with Government, regulators and industry, as well as international colleagues to make sure data protection and innovation can continue to work hand in hand.
What is live facial recognition?
Facial recognition is the process by which a person can be identified or recognised from a digital facial image. Cameras are used to capture these images and FRT software measures and analyses facial features to produce a biometric template. This typically enables the user to identify, authenticate or verify, or categorise individuals.
Live facial recognition (LFR) is a type of FRT that allows this process to take place automatically and in real-time. LFR is typically deployed in a similar way to traditional CCTV in that it is directed towards everyone in a particular area rather than specific individuals. It can capture the biometric data of all individuals passing within range of the camera indiscriminately, as opposed to more targeted “one-to-one” data processing. This can involve the collection of biometric data on a mass scale and there is often a lack of awareness, choice or control for the individual in this process.
Why is biometric data particularly sensitive?
Biometrics are physical or behavioural human characteristics that can be used to digitally identify a person to grant access to systems, devices, or data. Biometric data extracted from a facial image can be used to uniquely identify an individual in a range of different contexts. It can also be used to estimate or infer other characteristics, such as their age, sex, gender, or ethnicity.
The security of the biometric authentication data is vitally important, even more than the security of passwords, since passwords can be easily changed if they are exposed. A fingerprint or retinal scan, however, is immutable.
The UK courts have concluded that “like fingerprints and DNA [a facial biometric template] is information of an “intrinsically private” character.” LFR can collect this data without any direct engagement with the individual. Given that LFR relies on the use of sensitive personal data, the public must have confidence that its use is lawful, fair, transparent, and meets the other standards set out in data protection legislation.