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In September 2016, our team was welcomed to the production facilities of a Dutch business-to-business (B2B) supplier of food solutions and supplements for the bakery and bakery-related food industry. (In the following we will address the firm as “SampleCompany” in order to keep the company’s privacy.)  SampleCompany aims to provide its customers with steadily innovative products and services which incorporate emerging trends such as sustainability and healthy ingredients. Without a doubt,  being the market leader in the Netherlands and among the most important players in the Benelux, the company is highly successful.

As competition increases and much more business data is available today, SampleCompany has come to realize that IT will be a competing factor in the future. While the business strategy has worked well for SampleCompany in the past, the company only recently (starting December 2015) put a new emphasis on IT by introducing a CIO, expanding the IT department and the formulation of an actual IT strategy. Our video illustrates facts about the company itself, our data collection process at the firm and the topic of alignment of IT and business strategy.

So, what is SampleCompany’s problem? After analyzing all the data the firm provided to us, we realized that the core issue is in short: “SampleCompany is lacking transparency of current IT landscape and all processes within the company.”

What should SampleCompany do and why should it do anything about it? Our solution suggests the company to obtain business process management software (BPMS). The introduction of business process management software will provide the firm with a central platform to store the company’s processes. Further, the BPMS can be connected to other systems such as the ERP the company will be using. Once all departments’ processes are entered into this BPMS system the evaluation of processes and resource deployment can begin. Since now all process steps, interdependencies and use of IT are entered, strategic management can assess which processes need revising.  The IT department, which should be involved in the process can simultaneously address IT usage inefficiencies.

Why should SampleCompany do anything about its problem, how can the business be transformed? Inefficient processes and inefficient IT deployment mean that not only value but also money which could be redeployed for other means is lost. The newly gained transparency with the help of BPMS will transform SampleCompany into a much more efficient company improving value-creation and competitiveness at the same time. This transformation to transparency will be of great importance in the future as business becomes more and more IT and process driven.

How should the firm approach the implementation of BPMS? In our report, we provide the reader and also the firm with steps and a timeline suggestion- from stating the business needs to an actual introduction of BPMS- to the SampleCompany. In an additional step, we have assessed risks, mitigation strategies and recommendations which the company should consider throughout the project. Among these, clear expectation management, support from top-level management and thorough employee training are the most important takeaways.

We hope that our suggestion will help the company to achieve the desired transformation.

Team 49: Sanne Legtenberg – 461533, Sam Buunk – 459362, Julia Dahm – 460607, Carla Osterholz – 459302

Cover picture: Bonita Soft, 2016 http://www.bonitasoft.com/products (last accessed: 13.10.2016)

 

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In our TOTW project we looked at thetransformation of the transportation industry. Specifically how BlaBlaCar and SnappCar help thousands of strangers to find a convenient and comparably cheap way of getting from A to B. We have shortly summarized basic company facts in the table beneath the video:

http://https://www.youtube.com/watch?v=w0C61dE7ckE&feature=youtu.be

	BlaBlaCar	SnappCar
Participants	> 20 Mio (worldwide) (Bloomberg, 2015)	200,000 in DN,NL,S (Wharton, 2016)
Total estimated value of platform	$1.6 billion (Bloomberg, 2015)	$6.28 MIO
Charges to participants	Fixed fee: 0.99€ (NL) Variable fee: 11,90% of fare (NL) BTW	Fee: at least 8.75€ (NL)
Acquisitions (so far)	5	1

BlaBlaCar and SnappCar are leading and still growing players in the transportation industry. But they could never have gotten this far without help, which is why we also introduced Cindy, Kate and Tom. (you have not met them yet? Here you go: https://www.youtube.com/watch?v=w0C61dE7ckE&feature=youtu.be). Cindy was looking for a ride to Maastricht while Tom offered a seat in his car for the desired trip and Kate offered her entire car. SnappCar and BlaBlaCar both provided a possible platform for these three strangers to meet.

The questions we answer in our video are: Platform-mediated networks: What are they? How do they make money? How do they compete?

The basic idea behind both platforms is as old as time: it is trade! “You have something I need or would like to have, while I have something you need or would like to have.” In our example, some users offer an entire car or seats in their car, while passengers are looking for a means of transport. BlaBlaCar and SnappCar provide the platform for both sides of users to meet. Why do they do it? Because there is money to be made! Over time, the platform providers have proceeded to charging fees to one side of the users. BlaBlarCar adds a booking fee on the fare price (BlaBlaCar, 2016), while SnappCar charges at least a basic fee (SnappCar, 2016), which is not always greeted by the users (Die Zeit, 2016), but how do you decide which platform you use?

This question is answered by the network effect! BlaBlaCar has millions of users worldwide-tendency rising; SnappCar’s reputation in its operating countries has been immensely growing since its inception. Clearly, you will choose the platform where you are most likely to find what you are looking for! The more drivers/car owners, the more passengers on the other side and vice versa, the cross side effect! The goal and decisive competing factor for either platform is to continuously concentrate as many users on as possible on their own platform. If they manage to win the race against their competitors, the Winner-takes-it-all!

But what will the future look like, both BlaBlaCar and SnappCar somehow do a similar thing; could they not merge to one platform? Possibly! Our chosen platforms do not competing head-to-head (yet) but they have strong complementary features. We believe that it is likely that one player will take over the other and integrates the complementary functionality in the future; this would be envelopment (Eisenmann, Parker, Van Alstyne, 2006). As competiton in the ride-sharing sector is rising, we strongly believe that these firms will look do anything to get into the winning position. What do you think? Watch the video and feel free to discuss!

Group 49: S. Buunk(459362), J. Dahm (460607), S. Legtenberg (461533), C. Osterholz(459302)

 

Sources:

BlaBlaCar (2016), https://www.blablacar.nl/faq/vraag/hoe-worden-de-reserveringskosten-berekend-en-wat-dekken-ze last accessed 25.09.2016

Bloomberg (2015), www.bloomberg.com/…/blablacar–value-hits-1-6-billion-after-latest-funding-round Last accessed 29.09.2016

Die Zeit (2016) http://www.zeit.de/mobilitaet/2016-08/blablacar-gebuehren-mitfahrgelegenheiten-kosten, last accessed 25.09.2016

Eisenmann, T., Parker, G., and Van Alstyne, M.W. 2006. Strategies for Two-Sided Markets. Harvard Business Review 84(10) 92-101.

SnappCar (2016), https://support.snappcar.nl/hc/nl/articles/203671771-Hoeveel-kost-huren-via-SnappCar-Last accessed 29.09.2016

Wharton – University of Pennsylvania (2016), http://knowledge.wharton.upenn.edu/article/peerby-snappcar-europes-sharing-economy-driven-efficiency/ last accessed 29.09.2016

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Platform-mediated networks are everywhere, the most prominent among them Facebook and Google. Those two love your data input as much as the famous “fat kid loves cake”. It should not be news to anyone these days that every step you take on the internet and especially on these platforms is monitored and either analyzed for personalized advertising or security (Hello NSA!) purposes. Regularly, your and my Facebook friends go crazy and post something like: “I do not allow FB to xyz according to their policy change 1,200,500.” Hate to break it to you, but by logging in or using the Google Search machine you as good as confirmed those already. We get annoyed, we fear data breaches, we worry about hacking but yet give our personal information freely to just about any online platform.

Why are we still using these networks? Easy! Because everybody else does (Facebook, Instagram etc.) or because I find exactly what I’m looking for there (Google, instead of Bing, who is this Bing anyway?!) This is the famous network effect at work and it is SO useful! Google for instance mediates multiple types of networks: sellers and buyers, advertisers and customers, those asking a question and those who have an answer. Thus, networks are mediated within pretty much no time; being listed first for a search query almost guarantees success.

Yet, there is sharp contrast between companies’ data policies with regard to data protection from governmental side and even more so the selling of data to third parties (AppleInsider, 2016). On the other hand, customers seemingly become more concerned about the use or their data: Google itself found that UK citizens’ have increasingly searched for cyber-security related issues and questions in 2015 (Telegraph, 2015). With regard to platform-mediated networks, the researchers Li and Pavlou ( found that we often face the network value versus-information privacy concerns dilemma, a “trade-off between positive network externalities (network value) and negative network externalities (information privacy concerns)”. As true as this may be, most of the times we willingly set our concerns aside to “get our value”; using the services a platform offers to us. So how big is this dilemma really? Are we customers really that concerned about what happens to our data? Are we more in fear of the mean, unknown individual hacker when in fact, we should be worried about all the platforms we give our consent to collect and use our data?

A nice illustration of what how data is used and how users regularly act on the internet is illustrated in the documentary “Terms and Conditions May Apply” by Cullen Hoback (2013). The movie shows how people consent to all sorts of terms and conditions with regard to their privacy rights without actually reading them; the former is certainly complicated – and knowingly so- by companies which follow non-transparent and questionable data policies. If you want to gain a short overview of recurring issues and greyish areas and techniques today’s companies apply, I recommend watching this movie. A lot of things have changed since 2013, some things may be presented too simplified or overly drastic but still, it is an interesting watch!

Now back to you: Do you sometimes catch yourself in the” network value versus-information privacy concerns dilemma when using an online platform” or are you regularly “not that bothered”?

 

Sources:

AppleInsider (2016) http://appleinsider.com/articles/16/02/17/user-security-privacy-issues-draw-sharp-contrast-between-apple-ios-google-android-in-fbi-encryption-case last accessed September 25th, 2016

Hoback, Cullen (2013) “Terms and Conditions may apply”. (Movie)

Li, T., and Pavlou, P. 2016. What Drives Users’ Website Registration? The Network Externalities versus Information Privacy Dilemma. Working Paper.

Telegraph UK (2015) http://www.telegraph.co.uk/technology/google/11814471/google-reveals-spike-in-british-privacy-concerns.html last accessed September 25th, 2016

Cover picture: http://3.bp.blogspot.com/-o0UBqCvAd_M/Ul7XViQ5WoI/AAAAAAAAO7o/qV-hpMc3dfo/s1600/terms_and_conditions_may_apply.jpg last accessed September 25th, 2016

 

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Remember the days when you had to wait until your favorite movie came out on DVD? Remember when you had to wait for bestsellers to finally be published in your country in your own language? No, the manufacturer did not burn or print those books, DVDs or CDs on a single computer one-by-one. This is a typical case of windowing! Delaying or sequencing the introduction of the newest media was and is a strategic decision- and it seems to become of renewed interest for information goods, especially music and movies. But one step back, what is this “windowing”?

Academically: “Windowing—the process of managing the release sequence for content so as to maximize the returns from intellectual property rights (IPRs)—is changing because of transformations in the way that television is distributed and consumed.” (Doyle, 2016)

Too academic? then how about a practical approach: If you want to have access to new songs/albums/movies right when they are released on certain platforms, you have to pay. Only after an undetermined amount of time (“Patience is a virtue”), non-premium customers will eventually be able to access the same content.

Spotify, Tidal, Netflix etc. all provide us with low-cost access to information goods such as movies, series, music or any type of other media we want.  Modern technology facilitates or enables the often illegal copying and distribution of these items.  While all of the named platforms make money through advertising and different versions of accounts (free-basic-premium access), pricing and versioning models are getting old and especially music artists become increasingly frustrated about the (financial) valuation of their work. An illustration of this frustration went through the media in early 2016, when Adele and Taylor Swift among other artist’s work were not available on Spotify upon new release (TheChordist, 2016). Yes, I know, you might not be a fan of either but still: a popular artist or producer withdrawing the permission to provide content can have a powerful impact in today’s world where everything is a mouse-click away. Surely, actions like these are not only caused by IPR (protection) issues but also financially motivated. Without a doubt, the tone and dynamics with regard to goods in the entertainment industry are changing. Again in academic language: the newest developments have “necessitated new thinking about how best to organize the sequential roll out of content so as to build audience demand, avoid overlaps, and maximize returns”. (Doyle, 2016) or in translation: The decision of when, where and for how much money should entertainment media be offered needs revising for multiple reasons.

While windowing is not new it might just be the revived trend for pricing and product offering. According to Sony Entertainment CEO Michael Lynton “Going forward, you will see some version of windowing in the music industry,” (Billboard, 2016) predicting a growing trend towards new pricing models for streaming platforms in general. Spotify on the other hand contests this claim, arguing that “exclusives get in the way of that for both sides*” (* musician and customer) (TheVerge, 2016).

From my point of view, the increasing amount of disputes indicates that pricing information goods in the streaming industry is becoming increasingly difficult. And I believe that windowing is almost certain to be introduced extensively in the foreseeable future; not only for music but also for example, Netflix series. What do you as a (potential) customer think?

• Will windowing be introduced extensively across the streaming industry?
• (How much) Would you be willing to for an early access to certain music or series?

 

 

Sources:

Billboard.com http://www.billboard.com/articles/business/6882769/sony-entertainment-chief-streaming-windowing-spotify-response 21.09.2016

Doyle, G. (2016). Digitization and Changing Windowing Strategies in the Television Industry Negotiating New Windows on the World. Television & NewMedia. Sage

The Chordist https://thetrichordist.com/2016/05/16/windowing-works-9-of-the-top-13-uk-albums-not-on-spotify/ 21.09.2016

TheVerge http://www.theverge.com/2016/2/18/11054460/spotify-exclusive-content-apple-tidal last accessed, 21.09.2016

Cover picture: Fastweb.com (2016) http://www.fastweb.com/student-life/articles/keep-calm-and-wait-for-college-admissions-decisions. A MONSTER company. Last accessed 21.09.2016