1.1 Introduction
We live in the era of the “platform society.” We get up in the morning and read our news or catch up with friends on social media platforms. Our journey to the office may involve a platform‐enabled lift in a stranger's car, using Uber. We stay in other people’s homes or rooms when we travel (Airbnb). We purchase everything online, even groceries via Amazon, never thinking to consider where the actual seller is located or who they employ, for how long.
We have become familiar with the new way of doing business that Uber, Airbnb, Amazon, Tencent, Alibaba, and many others have introduced to us and consider this the new normal. Digital platforms and ecosystems are not restricted by borders, locations, and industries (Nambisan et al., 2019). Pioneers ranging from Amazon to Lyft and Zillow and from Airbnb to Zalando and ZBJ are disrupting the retail, healthcare, real estate, banking, lodging, and steel industries, and labour markets (Jacobides et al., 2019). We turn to casual task platforms like Helpling or TaskRabbit whenever we want to hire a person for a specific job.
As such, “there is no doubt that platform models are here to stay” (Choudary, 2015). Choudary claimed in his book “Platforms Scale” that platforms will even become increasingly powerful and concentrate on collecting more and more data to cross- or upsell services. For example, data captured by commerce platforms like Alibaba also served as input to a financial credit rating system. The author argued that platforms that facilitate interactions and capture data will have an increasingly larger role to play in the future of global trade.
OECD: “By 2022, over 60% of global GDP will be digitized. An estimated 70% of new value created in the economy over the next decade will be based on digitally enabled platforms.”
We find supporting evidence at the World Economic Forum (World Economic Forum, 2019) when they state that platform-oriented companies are seriously disrupting traditional business. Even though traditional players are fast in embracing the platform model to safeguard or grow their products and/or services portfolio they risk being overtaken by new players (often start-ups).
Andersson Schwarz (Andersson Schwarz, 2017) warned us that although consumers or users may see digital platforms as technologies that enable us to share, communicate, or transact freely, in reality, they are governing systems that control, interact, and accumulate.
Although more people and things are becoming connected through networks, it is clear that the digital transformation of governments is still only at an early stage and that governments are late in adopting the platform model (Accenture, 2018).
Platforms also change the way we interact with government authorities (using, e.g., online portals and digital registries). However, OECD stated that the policy response of governments to the digital transformation has been mixed. Some are developing a strategic and pro-active approach to leveraging its benefits. In contrast, others have made piecemeal decisions to contain or roll back the consequences of specific incidents (e.g., security breaches) or the impacts of new technologies, applications, or business models (OECD, 2017).
Many policies, and public sectors’ internal processes and dynamics, are a legacy of an analogue era that assumed a physical context and are ill-adapted to the digital era. OECD advises that policymakers must work to ensure that the opportunity offered by the digital transformation is used to improve the well-being of all citizens.
The lack of an integrated, whole-of-government approach increases the risk that policies in one area will have unintended, possibly adverse, impacts on another, or that opportunities for synergies that enhance positive effects are missed.
OECD already recommended in 2014 (OECD, 2014) to optimize public service delivery, whereby the government is no longer necessarily the provider of public services but increasingly acts as a broker that allows for the right solutions to a specific citizen’s problem to be delivered by the provider best fit to do it. This will enable the government to benefit from the effects of scale and network. This is, however, leading to complex trade-offs, such as balancing privacy and convenience.
An example where scale and network effects play, is the rapid rise of Internet Hospital Platforms in China (Wu et al., 2019), sponsored by the government. The Chinese government views digital medicine using the platform model as a solution to address several challenges like the overprescribing of profitable drugs and diagnostic tests (leading to a waste of health resources). China’s fast increase in internet users (from 22.7% in 2008 to 59.6% in 2018) provides an opportunity for the development of digital medicine platforms. The online platform supports the health-care provider at the community level in diagnosis and treatment decisions. The provider can link the patient directly to the platform for a video consultation with a physician. If no diagnosis can be made, the patient is referred to hospitals associated with the platform. As good as it sounds, this way of working also has its challenges, including patient safety, data security, and lack of surveillance and evaluation frameworks.
In summary, adopting the platform model is relevant today and will continue to be the state-of-the-art in public sector innovation (Smedlund et al., 2018).