An opportunity for inclusion? Digital platform innovation in times of crisis
Numerous digital platforms have emerged as a go-to response to the Covid-19 crisis – building on conventional platform characteristics, but using alternative, more inclusive organisational models. Researchers Nicolas Friederici, Philip Meier and Ali Aslan Gümüsay explore.
In a matter of weeks, the coronavirus crisis has drastically altered the ways in which we live and work. We have been confronted with painful necessities, like avoiding physical contact, even with friends and family, from one day to the next – a severe shock to our societal systems.
While its shock has been deadly and devastating, Covid-19 has also triggered a wave of prosocial behaviour. The world over, people have been galvanised into action, not least in the realm of social innovation, sparking new ideas and entrepreneurship.
What kinds of social innovations is the crisis bringing to the surface? How much impact do they have, and are they sustainable? Answering these questions will help innovators as well as those considering funding and supporting them.
Platforms as the go-to response
Scanning innovators’ immediate response to the crisis, we observed an interesting pattern: many of the proposed solutions are digital platforms. It appears that platforms’ properties as distance-bridging technological architectures and matchmakers in multi-sided markets have made them the go-to response to the disruption of analogue connectivity that the virus has created. Days after lockdowns were announced, neighbourhood platforms that sought to identify helpers for the elderly or to connect small local stores with shoppers were established. Charity platforms like betterplace.org also saw immediate spikes in web traffic.
These could be idiosyncrasies, so we took a closer look at recent innovation challenges and hackathons, which invite anyone interested to work together on solutions. These formats have had broad participation and are therefore representative of responses to the crisis. For example, at a challenge in Germany that aimed to “hack the virus”, more than 28,000 participants developed around 1,500 initiatives in 48 hours. As many as 700 jurors selected the 20 best projects, of which 14 were platforms. These projects will now receive up to €47,500 each from the German Federal Chancellery together with private institutions like the BMW Foundation, Vodafone Institute, and Google Germany. Similar contests have been held all over the globe, for instance, at MIT, in the OpenIDEO design community, and on GitHub. Despite the different submission criteria stipulated by the various hackathons and their diverse target audiences, digital platforms made up a significant share of the entries.
Shifting opportunities: market, motivation, and urgency
Why have platforms become the social innovation of choice to address Covid-19? One possible answer is that unexpected crises open up new opportunities. While there are some barriers – for example, limited resources, especially in low-income countries – a range of factors work in their favour.
In normal times, it can be challenging for platforms to orchestrate the two sides of a market (for example volunteers wanting to help and organisations needing help) in parallel. Both sides come with unknowns, complex dynamics of competition may be at play, and the effort required to attract a critical mass of users can be resource-intensive. To solve this, demand and supply must often be substituted or generated by the platform itself. In contrast, in times of crisis, demand and supply for certain goods and services can spike at the same time, within short intervals, and without the platform needing to stimulate the market.
In times of crisis demand and supply for certain goods and services can spike at the same time, without the platform needing to stimulate the market
Platform stakeholders’ motivations to contribute can also be spurred as the result of a crisis beyond an obvious economic benefit. This is true for any stakeholder group: founders, funders, users, supporters, and so on. For instance, public funders may see an immediate need for intervention, fuelled by rare political consensus that money should be spent. Platform users can also have extraordinary reasons to participate: a crisis may trigger their best impulses, leading them to look for ways of doing something good.
Finally, crises require responses to be found urgently. Often, a fast response is a matter of life and death. Even when it is not, new problems may arise with unparalleled speed, and risk getting a lot worse very quickly. Notably, a newfound sense of urgency can trigger long-term and structural change. Innovators leverage stakeholders’ increased willingness to act for longstanding agendas. This is exactly what we are now witnessing in discourse about related societal challenges, such as climate change or health system reform.
What platforms offer
Platform innovations from contests we screened reacted to these shifts in opportunities in distinct ways. It is not that innovators have come up with entirely new ideas for what platforms may do; rather they are applying their understanding of platforms’ particular potential to the needs of the crisis at hand. In the case of the current crisis, its particular features have sparked new hope in the old promises of digital technologies. Digital platforms, by virtue of their function as connectors and matchmakers, offer a set of value propositions that are distinctly relevant in the current context, taking advantage of the outlined shifts in markets, motivations, and urgency.
First, platforms have the ability to connect people and organisations across space, despite physical distance. One example is the platform Digitales Wartezimmer (Digital Waiting Room). Addressing infected or suspected coronavirus patients, the initiative aggregates information about support channels across Germany. Another spatial constraint that platforms can mitigate is the fragmentation of supplies and capacities. Outbreaks have quickly impacted local geographies, leading to over- and under-supplies of medical staff and things like face masks or ventilators. Digital platform ideas like Traack or Open Logistics seek to make such capacity imbalances transparent and addressable for the parties along the supply chain. Similarly, fintechs like iwoca and Tully have set up platforms to help allocate government-provided financial relief packages to SMEs and individuals.
Digital platforms, as connectors and matchmakers, offer a set of value propositions that are distinctly relevant in the current context
Platforms’ second important value proposition is that they can enable social connection through forms of distant socialising. Lockdowns have led to isolation, with worrying effects on mental health and domestic violence. Platforms like Pose Party or Telehelp offer human connection, fun, or emotional support. Other platforms aim to channel people’s prosocial impulses. The pandemic’s historic proportions have inspired many who want to help those worst hit by it. Yet, with cities on lockdown, traditional modes of volunteering or advocacy are off limits. Examples such as Machbarschaft (a word play on the German for “doable” and “neighbourhood”) offer a virtual outlet for people’s motivation to help elderly neighbours with daily needs.
Third, digital platforms offer superior speed of implementation and the potential for quick scalability. Through tools like Sharetribe, even small and non-technological organisations can set up a functioning digital platform within minutes or hours. Sharetribe has had extraordinary demand for its service, and is now offering its software for free to nonprofits addressing Covid-19. Many demands posed by the corona crisis are urgent and only worth addressing if this can be done quickly. In particular, the critical matchmaking of medical staff and equipment has become a task that social platform innovations such as Print4Life seek to address. Digital platforms can also onboard a practically unlimited number of users in short periods of time, exploiting the “near-zero cost of the second copy” properties of digital technologies. For instance, Das Land Hilft (“The Country Helps”), a platform to match voluntary harvest helpers with farmers to compensate for the loss of seasonal workers, has seen user numbers rise from zero to 43,000 users within just two weeks.
An alternative platform model
Whether these platforms focused on space, socialising, or speed, all seemed to be based on a rather conventional imaginary of digital platforms: that they are powerful, fast connectors and matchmakers, at a distance. At the same time, we realised that the underlying ideologies and organisational paradigms were very different from – and probably antithetical to – the dominant platform business model.
The standard platform playbook is to raise large sums of venture capital, set up a for-profit private company, enroll a critical mass of users, and achieve a degree of market dominance that allows for rent extraction and economies of scale and scope.
The standard platform playbook is to set up a for-profit private company... the platform innovations we observed emphasised values like openness, sharing, cooperation, and transparency
Instead, the platform innovations which we observed emphasised values like openness, sharing, cooperation, and transparency. One illustration of this was Pflegesterne (Care Stars), which enables a network of health organisations to address together the shortage of nursing staff in care facilities and hospitals.
Such values were not born out of the criteria of innovation contests: eligibility requirements tended to be rather loose and did not preclude profit-oriented models. Still, digital governance principles like open data standards, privacy and encryption, and distributed multi-stakeholder control were commonplace. We see this as a redefinition and reappropriation both of the means and the ends of digital platforms. Innovators wished to serve prosocial outcomes and organised their platform innovations in line with inclusive principles. Such an inclusive modus operandi meant addressing the societal disconnect that the crisis has produced by building on both conventional platform characteristics and alternative organisational models.
When the crisis ends
The pressing question is whether new digital platforms and their innovations will be sustainable. As deep and disruptive as the corona crisis is, it will eventually end. The acuteness of challenges and opportunities due to shifts in market, motivation, and urgency will subside. It remains uncertain how the crisis-driven shift in the ways platforms are being employed will affect the landscape of digital platform governance models in times to come.
Many digital platforms that arose to swiftly address spatial and social challenges are likely to disappear; others may evolve or transform. We see that this can work for platforms that were established in response to previous crises. For instance, following the 2015 migration crisis in Europe, education platform Kiron was founded in Berlin. Having launched as an aggregator for online learning courses, Kiron now offers refugees a digital pathway towards a bachelor's degree by cooperating closely with national and international educational institutions.
Some platforms may partner or merge with each other. Neighbourhood platforms will likely come together to form meta-platforms. Others will connect to established organisations. As Silicon Valley companies have struggled to respond to Covid-19 by offering the innovations that people most need right now, more inclusive platform alternatives may now have an opportunity to step up and secure a more significant role in the platform economy of the future.
- Nicolas Friederici is a senior researcher at the Humboldt Institute for Internet and Society and associate at the Oxford Internet Institute. He is the principal investigator of the Platform Alternatives project and the Data Cooperation Platforms for SMEs project.
- Philip Meier is a researcher at the Humboldt Institute for Internet and Society and doctoral candidate at the University of the Arts in Berlin.
- Ali Aslan Gümüsay is head of the Innovation & Entrepreneurship Research Group at the Humboldt Institute for Internet and Society and postdoctoral researcher at the University of Hamburg. He is also the principal investigator of the DFG network “Grand Challenges & New Forms of Organizing”.
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