Articles, IoT, Manufacturing & SCM

Appleism & Googleism – A new management approach in the 4th industrial revolution!?

Authors: Dr. Bastian Halecker, Matthias Hartmann

Driven by the dynamic of the current digital age the questions arise: what is the current (best) management approach and how can this one be explained. This highlights the relevance of a holistic & integrated approach next to the intensive technology discussion.

So far, the improvement of the efficiency of complex supply chains along the value-added stages has been tried through optimizations. However, these days the supply chain is no longer the central object for value creation. Instead, it is about value networks that bring together companies and individuals (!) and enable both sides to exchange values. The basis for this are platforms and their business models. The main focus does not lie on the production of services, but on the link between external producers and consumers. Many traditional companies are having difficulties with this transition from the “Center of Production” to the “Center of Exchange”.

The power of the platforms becomes particularly clear as soon as the company values of the largest global platform companies are considered (see figure below). These companies represent new “modern monopolies” in their respective segments. They are currently benefiting from an “all-or-nothing” principle or the approach “The Winner takes it all”. These platforms are not dominant because they own or control resources, but because of their efficient networking of resources and / or users. It is always about minimizing transaction costs while promoting complementary innovations. Apple and Google (belonging to Alphabet) are especially eye-catching. With their successful platform approaches, both companies have developed into two of the most valuable companies of our time. The iOS platform Apple connects developers of apps with users. The search platform Google connects internet content with users or consumers. Thus, with their approaches, these companies representing a new management version of the 4th Industrial Revolution. Consequently, we want to refer to these management approaches as Appleism & Googleism, based on the history (e.g. Toyotism). If the 4th Industrial Revolution is viewed from a systemic perspective, technology is again the driver of a new management approach. Appleism and Googleism are therefore results of the development of the internet (end of the 1990s: information networking) and were fueled further by the development of smartphones and apps (2000-2015: information goes mobile).

Source: Moazed & Johnson (2016)

From today’s point of view, cyber-physical-systems leaves open the question of who or what, from management perspectives, will trigger the next revolution. It is possible that new potentials arise from the rapid development of artificial intelligence, in particular machine learning. Especially with regards to the vast amount of data generated by the ever increasing quantity of “things” in the network, a large number of new business models are created. These business models use the new, data-driven “insights” in order to be able to react in a targeted, personal and foreseeable manner (“predictive”) to customer requirements. This will benefit those companies that generate the most data from their customers and thus develop the best methods, which in turn leads to new customers. Apple and Google are particularly active (once again) in the topic of artificial intelligence and machine learning. Do these companies have a new answer to the networking of all things and will they continue to expand Appleism & Googleism’s management approach in the 4th Industrial Revolution?

This question will be answered with certainty in the near future.

About the authors:

Prof. Dr. Matthias Hartmann teaches production and logistics, information management and innovation/technology management. He finished his doctorate on business evaluation of high-tech companies and consulted service companies for many years. Prior to his appointment he worked for the global management consulting firm A.T. Kearney.

Dr. Bastian Halecker is the CEO of Nestim – A company that match entrepreneurs, managers and ecosystems to create innovations at the core of the digital age.

Leave a Reply

Your email address will not be published. Required fields are marked *