Scott Brinker’s posts always inspire new insights and ideas. One, in particular, that especially resonated with me was on platform dynamics. One takeaway is that SaaS/cloud platform dynamics enable a magnitude of value-add creation which feeds back onto the ecosystem’s growth and stickiness.
I believe successful growth driven executive leaders inspire and navigate their organizations with similar dynamics.
I appreciate Scott for allowing me to modify his originals for these comparative illustrations.
One main reason I enjoy the martech space is that it provides me insights to identify the likelihood of high-performance companies sooner. These companies produce resilient technology ecosystems, strong communities, and far significant investment returns. In part, this insight leans on monitoring leaders and organizations that parallel these platform dynamics.
Let’s explore why.
Scope and then Empower Everyone
Platforms and Organizations have two parallel themes: Empowerment + Scope.
Below, Scott beautifully illustrates how each platform supports the layer above. There are three striking notions:
1) Quantity 2) Extensibility (Utility), and 3) Pull.
The handful of cloud platforms serve as a consolidated general-purpose foundation. These cloud platforms support the millions of ‘custom apps’ with diverse business-specific needs.
Now, let’s transform our technology-based narrative to an organization-centric ecosystem breakdown… Poof!
NOTE: Let’s put aside the customer for these examples. We can agree each organization and its broader ecosystem strives for optimal customer-centricity.
Notice that successful dynamic leadership actually serves the community at large. The teams and individuals of the organization play their role in navigating and adapting to the best course of the ecosystem’s needs.
We saw these dynamics emerge during the transformation at Adobe into the cloud. In their cloud transformation, Adobe was in constant communication with the ecosystem of customers, partners, advocates, and shareholders. They shared their plan, expected pains, and outcomes, which were all transparent. More importantly, the empowered teams and individuals charged forward within their scope of responsibilities.
A platform requires confidence, trust, and a collective sense of accomplishment. So did Adobe’s new organizational mindset. This would prove to be a powerful tailwind and a 10X shareholder return in only seven years!
By empowering greater influence and confidence within the organization, Adobe effectively extended it throughout the community, stakeholders, and industry.
Building Upon Influential Foundations
Product confidence and community support help platforms rapidly scale. Let’s now consider the following dynamic.
Every app or platform has a foundation. Custom apps are built from the apps/platforms below.
This empowerment translates well into organizational leadership.
The community influences the organization. Leadership navigates the organization to support the community.
While the above statement in itself is obvious, the parallels to modern platforms are uncanny. Going against the grain of the community creates significant headwinds and even consequences. Culture, tone, and empathy are powerful leadership tools in a more decentralized organization. More curious thinkers and agile development inspire new product offerings.
Leadership, like platforms, must empower and positively enable people to open doors to new opportunities. This is especially critical in a fast-growing ecosystem.
Atlassian and Salesforce both exemplify evolutions well beyond their initial target persona. They have *rapidly* evolved to become an essential cross-silo business operations platforms. This extensibility leadership mindset to serve an evolving community is a style that mimics these platform dynamics. Salesforce has now entered the Dow index after only two decades of existence. Atlassian recently invested $50 million to push beyond their collective offerings.
These actions spill over now into attracting strong partner relationships.
Breaking Growth Barriers with Partnerships
Another illustration from Scott describing the roles app platforms play in the ecosystem.
Below, Teams and Specialists (App & Specialist Platforms) flesh out an organization. So, Partnerships (custom apps) then are incredibly pivotal to what I call an organization’s “resilient growth.” Partnerships are critical in modern moat building, especially in a digital marketplace.
Care in communication, collaboration, and productivity with employees and partners must extend into the broader community. This relationship enhances the organization’s balance between growth and talent, reach and credibility, leadership, and execution. These ‘fulcrum teams’, responsibilt for the balance, range in their definition and scope. Anything from product management, product marketing, and even various strategic operations roles can all play this part.
A notable example is Hubspot, also expanding beyond their initial ICP (ideal customer profile). They have an incredible responsibility to build the right ecosystem prioritizing culture of talent and team dynamics. Hubspot exemplifies this through relationships and conscientious support of partners and advocates. The company continually invests in the community as a core company asset. At the same time, it weighs its vision and growth with the trend in the industry.
This shift in weight allocation creates a see-saw effect—a timely shift between Leadership / Shareholders and Partners / Customers’ goals. Enough constant movement delivers an optimal balance on the fulcrum. They do this through their content creation, product, support, and integration points for the community. The near-perpetual motion continually generates higher customer retention and growth through its constant evolution. Hubspot has more than 10x in value since its public debut in 2014.
This balancing act is a crucial differentiator between rising SaaS companies and those with limited growth potential.
Value-Add Promotions
Lastly, in this illustration, the value-add leaps between ‘chasms.’
Within high-performance organizations, the value-add is the scope of responsibility. Still growing, apps always provide key value-add solutions to focused problems. With growing value-props, eventually, apps can elevate to a greater platform status.
Likewise, organizational talent is critical to the scope of their role. Much like growing apps, rising stars who become promoted gain greater scope and empowerment authority.
- The Marketplace Chasm → Partner & Community relationships with the Company.
- The Executive Chasm → Value-add Teams’ relationships with leadership.
What’s exciting is that greater fluidity and connectivity between these relationship ‘chasms’ signals more significant growth ecosystem potential…
Form Follows Function
… as does leadership.
Modern software is rapidly evolving on how platforms/apps play a role in the digital arena. I continuously study the intersection of people, data, and money, especially in tech. There are remarkable similarities between leadership and platform dynamics. And the signals they produce are telling.
- Organizations that share modern platform dynamics have greater agility and marketplace insights.
- Community, a growth asset, requires regular investment in the platform of trust, transparency, collaboration, and empowerment.
- Performance leaders develop culture platforms to empower value-add talent. Also, they ensure substantial partnership success for “resilient growth.”
A high-level example, the wildly talked about FANG (or other growth company acronym) stocks which exhibit this DNA, has outperformed over 400% over the S&P 500 over the last six years. Adding Apple increases the performance. Among private SaaS startups, the gaps are even larger.
Like platform ecosystems, performance leadership creates critical flywheels and moat creation effects. These effects create on-going opportunities, especially significant in a subscription-like relationship with customers.
Rising leaders, modern marketers, and growth investors should pay attention to this leadership style as it is found in the most highly valuable organizations and brands.
I have an assignment for you. Where do you find opportunities of influence throught performance leadership dynamics? What were your takeaways from them?
Full disclosure, I am a long investor and have recommended investment into SFDC, TEAM, ADBE, HUBS because of the trends and dynamics described in this article.