The world is changing and so is the face of businesses. With the advancements in technology and havoc rise of digitalization, across industries, Platform Economy is an increasingly growing concept.
Platform Economy, also known as Digital Economy or Online Platform Economy, is a recurring activity that is facilitated by different platforms. However, this is more than just another online transaction. In Platform Economy, it is all about bringing collaboration online and at the fingertips of the customers. Some of the top examples of Platform Economy includes Amazon, Microsoft, Apple, which are commonly identified as integrator platforms and they enable multiple brands to come together to serve the consumers.
In countries like India, there has been a gradual shift of economy towards digitalization only in the past decade, which has been steadily growing. Platform Economy is a term that captures a holistic approach of the economy that is aided by digital enhancements.
In today’s world, there is a huge variety of digital platforms that are differentiated on the basis of their functionality and type. From service-based platforms such as Uber to product-based ones such as Amazon, payment-based ones such as PayPal and software-based such as Apple - the offerings of these platforms are endless. When compared to the traditional modes of businesses, these platforms have successfully enabled economic growth by four folds. The online platforms used by these digital-based economy have a number of other names beside Platform Economy. Some of them are “Gig Economy”, “Sharing Economy” and “Peer Economy”.
Since the past few years, there has been an increasing demand and corroborative supply of new platforms in the market. Platform Economy might seem beneficial, however, this new wave of economy has received a mixed response from the experts. While one school of thought advocates for the Platform Economy, stating that these platforms can enhance productivity, work as an important tool in reducing costs, make the current market efficient and introduce new markets. The other school of thought that doesn’t support the rise of Platform Economy argue that this method replaces traditional jobs and adds to technological unemployment.
Despite the arguements from both sides, since 2010, there has been regular reviews and analysis around Platform Economy and has become one of the top sources of employment across the globe.
Before we talk about the relationship of Platform Economy with Mechanical Engineering, let us understand this concept further.
In Platform Economy, the experts have identified three types of platforms. This include:
Innovation Platforms: This is the kind of platform that is responsible for providing consumers with technology-based frameworks which can be easily adapted to an individual use rather than catering to a mass at the same time. Some of the top examples of Innovation Platforms are Salesforce, Microsoft and so much more.
Transactional Platforms: This kind of platforms act as integrators. They are known as Digital Matchmakers because they are designed to ensure the perfect mix and match of marketplaces, making them accessible to a large mass of people. These are not just product-oriented businesses, but are people-oriented too. Examples of this kind of Platform Economy include Amazon, Facebook and so much more.
Integration Platform: The perfect blend of Innovation and Transaction, this kind of platforms appear like marketplaces but have so much more to offer. These are not just confined to connecting people or products; they have the ability to merge it all. Most common examples of this kind of platform include Apple Store and Google Play.
What is the role of Platform Economy in Mechanical Engineering?
Mechanical Engineering is an extremely common yet complex realm of study. This field has remained in existence since the emergence of civilization. The products that were pursued as purely physical are slowly undergoing some major transformation. The classic physical structures are gradually entering the hybrid product-service systems. When it comes to B2B in Mechanical Engineering, the way of handling business has stepped into the platform economy model. From products and services to data, it is all conducted through a digital process.
When it comes to Mechanical Engineering, there are 2 major kinds of platforms that this industry uses:
Digital Platforms for Industries: In recent times, instead of selling it to a retailer, the Manufacturing units put products up for sale on online platforms and lets the transaction occur in the virtual marketplace. However, these marketplace are not new; they have been around since Internet Economy came into being. New developments in this kind of marketplace include expansion of equipment, enhancements of the marketplaces and purchasing of products. The example of such kind of platforms include SAP Ariba, Wucato, Zamro and more!
Industrial Internet of Things: For industries that cater to Mechanical Engineering, one of the top requirement is the digital infrastructure. This helps the organizations connect customers to the cloud. The process of adding digital infrastructure not only helps in saving spaces, but retain data for a longer time, making it accessible to anyone throughout the organization. The reduction in error in the output builds customer trust and enables retaining them for long.
How is Platform Economy impacting Mechanical Engineering:
- It brings about a holistic approach in digital management counselling. From procurement to supply - digital platform eases the entire process involved.
- These platforms identify the unique needs of Mechanical Engineering and caters to serve them.
- They help the people involved get a thorough evaluation of the products and services needed, as well as make offers for each of the individual needs.
- These platforms make the coordination and communication within the organization and beyond, hassle-free.
- These platforms are so easy to understand and operate that it has made the entire process seamless. There is lesser confusion, lesser hassle of indulging in bargaining and timely delivery of the products.
- Digital platforms have enabled the co-existing of different ecosystems possible in the same platform. This has also made products being easily visible on the digital world, which, in turn helps in enhancing the sales channel.
How Platform Economy is impacting other industries:
These digital platforms help organizations analyze the data at hand and use it in the right way to get the optimum benefits when it comes to the economic criteria.
The open forum through Digital platforms has helped strengthen the existing ecosystem, build new ones and lay their focus on innovation and transaction.
The Digital platforms encourage better communication with customers and help maintain transparency. It has also helped the service providers understand the reality of demand and supply.
The digital platforms have encouraged the providers build new market mechanism that not only help generate sales, but has also helped them switch to new business strategies to retain customers.
The emergence of Platform Economy in Mechanical Engineering is relatively a new occurrence. It is at a nascent stage and hence, there’s a lot of experimentation ongoing. A wide variety of providers have entered the market and are thriving to make a mark of their own. Each server profile is unique to one another and exhibit immense dynamism. The competition in the market has also encouraged the servers to improve their methodology and strive to become better. This has helped customers who require services from the Mechanical Engineering industry because they can now buy products that have had proven record of efficiency and profit.