Platform Ecosystems in Big Data
I have written about the platform eco-system trend in technology recently. To recap, a business that has been gaining ground in the tech world is the technology platform developer network model, wherein large numbers of developers can use the platform to build their businesses cost-effectively without the handicap of huge infrastructure expenditure. Some of the better-known illustrations of this trend are Apple’s iOS, Salesforce.com’s Force.com and Google’s Android, which provide developers the necessary tools to build and release their apps rapidly.
This model is now seen in the Big Data and analytics segments as well.
One of the major platform players in the analytics space is SAP’s HANA development platform. SAP HANA is based on a columnar in-memory database that allows deep analysis while capturing fresh transactions in real time. Through its HANA Enterprise Cloud programs, it targets developers as eco-system partners.
At 1M/1M, we have a collaboration with the SAP Startup Focus program that is focused on startups developing on the HANA platform. One of the companies we’ve been working with, Approyo, gave us an opportunity to peek somewhat closely into the mechanics of the HANA platform and how startups are leveraging the platform and its eco-system.
Chris Carter, the CEO of Palo Alto, CA-based Approyo, shared with me some interesting vertical solutions that Approyo has developed leveraging the HANA platform. Chris has been in the SAP eco-system for nearly 20 years. Approyo is a SAP HANA value added solution provider focusing on developing predictive analytics applications for specific verticals. It has been providing HANA services for the past two years to customers in retail, oil & gas, manufacturing, healthcare, CPG, etc.
One of the solutions Approyo has developed that has broad applicability is in the domain of managing energy costs for hospital facilities. It brought about a 28 percent reduction for one hospital by considering various data sets—average energy costs, quarterly costs, patient days, housekeeping down to their cafeterias, maintenance, and repairs. All those have implications that can be used to understand the facility’s cost and the reason behind the spikes in particular periods. By deeply understanding and programming large data sets that impact energy consumption within the workflow of a hospital facility, this solution is now able to predict opportunities for cost optimization, as well as process changes that may lead to further cost reduction. (Related reading: Thought Leaders in Big Data: Chris Carter, CEO of Approyo.)
Based on their early success, SAP’s Startup Focus program promises to help sell Approyo’s energy optimization solution for hospitals to a much larger set of customers through the SAP channel.
There are other such vertical solutions that Approyo and other solution providers are developing on the HANA platform. For SAP, the platform ecosystem model has contributed to a broad-based adoption of its platform across 25 industry verticals from life sciences (genomics), mining (predictive maintenance), and automotive (targeting promotions by dealership for instance) to sports and entertainment (player scouting and fan experience).
And for entrepreneurs like Chris Carter, it makes it possible to develop a cutting edge solution faster and much more efficiently without having to sustain high infrastructure, research, and development costs, as well as time-to-market disadvantages. Additionally, access to the channel of a large platform vendor partner is tremendously advantageous in bringing industry specific solutions to market.
I am very bullish on the platform eco-system trend, and am seeing faster adoption of the model up and down the technology value chain. Just in the last 3-4 months, I have talked to at least 30-40 executives in various technology companies who are developing platform ecosystems. They each consider the initiative to be a cornerstone growth strategy for their businesses.
It’s a great model that not only helps the platform vendors scale, but also helps startups build businesses rapidly, without having to build the entire stack of cutting edge technology.