Only few platforms are created –› Thresholds for participating in the early stages of development should be lowered

Challenge: Only few platforms are created

In the manufacturing industry, platform-based business activities have not been and are not being created sufficiently. To create a virtuous cycle of participation and growth, a sufficient number of parties becoming involved in digital platforms is required. In the early stages of digital platform development, three factors make companies’ thresholds for participating higher: a lack of trust, a lack of competence related to the platform economy, and closed ICT systems.

(1) Lack of trust: The threshold for participating in platforms is high, especially in their early stages, as companies fear that data critical for competition flows to competitors through digital platforms. This distrust also stems from a lack of clear operating models and common practices in data sharing.

(2) Lack of competence related to the platform economy: The industry has not much of experience of multi-party digital platforms. There is little expertise related to operating digital platforms or organising business activities through them. The lack of competence is particularly emphasised in small and medium-sized enterprises and where an organisation is developing its operating practices, for instance by transitioning from the sale of production commodities to the sale of services. In addition, the manufacturing industry is not familiar with the basic principles and calculation methods of digitalisation and data value.

(3) Closed ICT systems: To protect critical competitive advantage, manufacturing industry systems of both vendors and users are often closed, whereas the systems of many machines and devices, including aeroplanes and power plants, may be closed for safety reasons. This is why few open digital and platform-based architectures exist in the manufacturing industry.

Recommendation: Thresholds for participating in the early stages of development should be lowered

• Supporting the creation of platforms and the early stages of their development. Public funding instruments should be allocated to financing the creation and development of platforms. Support is also needed to moderate the creation of platforms, where a trusted party brings together others on the platform. Particular attention should be paid to building trust and developing platform business competence.
• The goal of innovation policy should be to create a platform-based marketplace. The creation and development of platforms should be the main objectives of innovation funding for the platform economy. For example, lowering the participation threshold should be added to the indicators for assessing the effectiveness of support instruments, besides the novelty value and commercialisation of innovations. Otherwise, the impacts of public support will not go beyond individual development projects and the piloting of commercialisation.
• Standardisation and regulation of the platform and data economy should be promoted. National innovation policy actors should collate and integrate standardisation and regulation solutions produced at the sectoral level, in national programmes and by international bodies. The manufacturing industry has already formed several co-creation platforms and consortia, such as DIMECC One Sea and Intelligent Industrie, the German Industrie 4.0 and the Business Finland Industrial Internet programme, as well as the International Data Spaces Association and the European Union’s DG CNECT. Solutions that have proven good should be scaled, for instance by taking them into account in support instruments and legislation.