3 Ways to Grow Your Business in a Digital Age

There is a widespread perception that startups are better prepared for the digital age than established companies. After all, startups are at the forefront of most disruptive innovations and breakthroughs. But there is more. Most “millennials” seem to prefer working for a startup or younger, fast-growing company. They have the impression that startups are just much more “fun”. The entrepreneurial spirit, the risk appetite, resilience, the “being part of something bigger than yourself” are all attractive features. Even the “uncertainty”, can be a source of excitement and motivation. There is no doubt that a “startup culture” is necessary for surviving in a digital world of global markets, exponential technological growth and shorter innovation cycles. Yet, larger, more established companies are also thriving in the digital age. Think . More and more experts predict that this will be the first “$1 trillion company”. Amazon Also, there are many different types of startup. The reality is that most of them struggle to scale or have a hard time surviving in the current, highly competitive, business environment. And let’s be honest, the vast majority of startups aren’t disruptive or innovative. Most startups are just bad “clones” of an already successful business model how really So, why is there so much discussion about startup companies are changing the way we live and work? What can we learn from successful startup companies? And, what is the essence of the “ ” that so many companies desperately want to embrace? startup culture 3 Features of the Most Successful Startups I have written before on these types of question, but — somewhat unexpectedly — I recently received inspiration during a business trip to Jakarta. It wasn’t my first time in Indonesia, but as soon as I arrived I noticed a lot more “green” compared to my previous visits. It didn’t take me long to figure out where all this green was coming from. Green is the main color of the jackets and helmets of the local on-demand motorcycle service, (motorcycle taxis are known as ). offers a ride-sharing app which makes perfect sense in a large and congested city, such as Jakarta. Go-Jek ojek Go-Jek started in 2010 as a call center where commuters could request drivers on-demand. During the first years of its existence, the company didn’t grow or scale. It was only in 2014 (after and Singapore-headquartered had entered the Indonesian market with their car-sharing services) that investors showed genuine interest in . Go-Jek ojek Uber Grab Go-Jek Right now, is considered to be one of Indonesia’s hottest startup. It has unicorn status and is the largest consumer technology company in Indonesia. Go-Jek ’s founder Nadiem Makarim received the in 2016 from , and the company recently secured a new round of financing of US$ 1.2 billion from Chinese Internet giant . was the winner of a fintech award given by Bank Indonesia in July 2017. Go-Jek Asian of the Year Award The Straits Times Tencent Go-Jek What is perhaps most important is that has had a remarkable impact on the economy in Indonesia. In the words of the Head of the Jakarta government’s Economic Bureau: Go-Jek “Go-Jek has changed people’s behavior, that’s for sure.” But, none of this explains why I am really excited about this company! Why should the rest of the world care about ? What is so special about this particular company? What distinguishes it from or , both of which have also launched motorbike taxi services in Indonesia? Go-Jek Uber Grab The short answer is that has understood and embraced the three most important considerations when starting and growing a business in a digital age: Go-Jek 1. Build an ecosystem Organize the business as an open and inclusive ecosystem that attracts users and engages all stakeholders. 2. Leverage technology to deliver constant innovation Focus on designing a range of innovative products and services that gather together diverse technologies to deliver an “irresistible” and “sticky” user experience. 3. Adapt to the environment Adapt firm products and services to the specific demands of the local environment(s) in which the business operates. This is the essence of a “ ” and it is by adopting these three strategies, that a business can put in place a culture — “business DNA”, if you like — that is innovative, dynamic, and maximizes opportunities for success in a digital age. startup culture Let’s look at each of these three elements in more detail, as they play out in the case of . Go-Jek Ecosystem definitely isn’t a “ride sharing company”. In fact, it isn’t a company in the traditional sense. differs from traditional organizations in that it doesn’t manage assets and workers according to well-defined hierarchical and static processes and procedures. Go-Jek Go-Jek takes a different approach. The founder has a visionary view on how to manage and grow a business. It is a vision of a company that looks to minimize those things that kill energy and ideas (think bureaucracy, hierarchy, rules): Go-Jek “The bigger we grow, the looser our control is. We allow different teams and leaders to run their teams their own way. The team leaders are free to develop their own management approach, so long as they can achieve their targets.” The results are astonishing. has become a thriving and dynamic ecosystem without settled vertical or horizontal distinctions, or even a clear distinction between the inside and outside of the business. Go-Jek Go-Jek seems to understand that the challenge today is mobilizing the capacities and resources of all stakeholders and engaging them in a more collaborative and inclusive style of organization. This results in better choices and products, but also creates a working environment that allows a business to recruit and retain the best staff. Go-Jek A leadership approach based on f_reedom and responsibility_ enables a constant and relentless flow of new ideas, talent, and capital through the ecosystem. This has made a genuinely exciting ecosystem that offers much more than a ride-sharing app and service. When opening the app on a mobile phone, users have a choice between a plethora of products and services. These currently include Go-Jek Go-Ride, Go-Car, Go-Send, Go-Food, Go-Mart, Go-Box, Go-Glam, Go-Clean, Go-Massage, Go-Tix, Go-Med. At the end of 2016, the ecosystem consisted of more than 250,000 two-wheel and four-wheel vehicle drivers, 3,000 service providers and 35,000 Go-Food merchants. The pattern of behavior and interaction among all the participants (including investors and partners) in the ecosystem has created a bar-raising culture of symbiosis and reciprocity. It is not only about how the participants in the ecosystem meet, talk, trust, share, interact, collaborate, team, experiment, and grow together. is an ecosystem in the biological sense of a “community of organisms” interacting in a particular environment. Go-Jek This push for “win-win” solutions could eventually even benefit ’s competitors. For instance, Indonesia’s largest taxi operator, , partners with . Other competitors, particularly logistics companies, understand that they also have to evolve and improve their services. Go-Jek Blue Bird Go-Jek Go-Jek’s Ecosystem. Source: CrunchBase Technologies What understands is that the most successful ecosystems in a digital age are focused on constantly designing and delivering innovative products and services for their platform/brand. These products and services gather together diverse technologies across sectors of the economy. Go-Jek multiple The aim? To deliver a range of products and services that can easily become embedded in the everyday life of users. Products and services need to be rich enough that users want to use the platform more of the time and have the opportunity to do more on that platform than anywhere else. gets it. The business model is to use technology to find more users for their platform, and to constantly give them additional reasons to engage more intensely with the platform. Go-Jek In this way, everyone — and not only users — can be “locked in” to the ecosystem. The delivery service, for example, has not only benefitted the drivers and the customers. Other service providers and merchants view as the savior in “Jakarta’s traffic-clogged economy”. Go-Jek Go-Jek Go-Jek _Dimas Ardian | Bloomberg | Getty Images Three years ago, Ferly Aninditya's stall at a Jakarta food court was losing…_www.cnbc.com Motorbike delivery and ride-sharing app Go-Jek boosts Jakarta's traffic-clogged economy In order to make the ecosystem irresistible to its consumers, offers an interactive and social app that includes a loyalty program . The algorithm gives customers intermittent and unpredictable rewards (similar to a slot machine), varying from vouchers for services to iPhones, iPads and laptops. Go-Jek Go-Points Go-Jek “The opportunities and challenges at Go-Jek are beyond thrilling. Being fully aware of its operations, we immediately knew that our resources and technology would certainly complement and accelerate product development at Go-Jek. Moreover, the fact that our work would help millions of Go-Jek mobile app users in Indonesia is something we are very excited about as well.” This was the statement of the founder and CEO of app creator and developer company, (after the company was acquired by ). Leftshift Go-Jek This statement shows the crucial role that technology plays in creating, maintaining and developing ’s ecosystem. It should therefore come as no surprise that is active in investing in, partnering with and acquiring startup companies. Go-Jek Go-Jek To deal with the demand to constantly innovate, had to set up an R&D centre. One of ’s investors introduced Nadiem Makarim to the founders of India-based startups, and and they have been credited with having “saved from imploding”. Go-Jek Go-Jek C42 Engineering CodeIgnition, Go-Jek Acquiring foreign startups has facilitated product innovation and improved the user experience inside the ecosystem. The acquisition of Bangalore-based healthcare startup added home healthcare services to ’s ecosystem. Pianta, for example, Go-Jek engineers are involved in data mining and analytics to understand and protect the ecosystem. Recently, engineers started to partner with artificial intelligence and machine learning company, , to help prevent and monitor cyber threats to the ecosystem. Go-Jek these CloudSek Technological developments should not be looked at in isolation. This became clear during ’s first in March 2017. The winners of the hackathon were active across the areas of connectivity, AI and the Internet-of-Things. Go-Jek Go-Hackathon Environment The third element is adapting to the specific demands of the local environment. This is something that also distinguishes from its direct competitors, and . Go-Jek Uber Grab _Viewed from the bubble of Silicon Valley, the world often looks like a single undifferentiated market. There are plenty…_theconversation.com The limits of Silicon Valley: how Indonesia's GoJek is beating Uber The fintech service, , is a great example of the importance of adapting the business model to local circumstances. successfully introduced an electronic and mobile payment system in the still largely cash-driven Indonesian economy. It was integrated in ’s app in April 2016, and currently accounts for more than half of all transactions. Go-Pay Go-Jek Go-Jek Nadiem Makarim is very clear about its success: “We’ve never seen a market adoption like Go-Pay.” The introduction of this service was successful because Nadiem understands the needs and demands of the local environment. He understood that many households are unbanked in Indonesia. In order to enable these households to participate in the financial sector and promote financial inclusion, had to allow users to give cash to drivers. Money will then immediately be transferred into their account. Adding to the account can also be done from a bank account or ATM. Go-Pay Go-Jek Go-Pay Clearly, offers tremendous opportunities for all the participants in the ecosystem. Particularly when can be used to pay other merchants and service providers. Go-Pay Go-Jek Go-Pay Nadiem Makarim believes that could “ ”. Of course, this will only happen if is able to keep up with technology and innovation. Go-Pay morph into a lucrative business Go-Jek How to Make a Thriving Ecosystem Sustainable? There is no doubt that the “ecosystem” model is replacing traditional economic theories about organizations, firms and markets. The Internet, algorithms, online ratings, artificial intelligence, provide instant access to all kinds of information (with minimal effort). This provides almost unlimited opportunities for companies to bind users into the ecosystem, to set up partnerships and to engage in constant innovation across multiple sectors of the economy. (and other successful startup companies) have leveraged the opportunities of a digital age to develop a new style of organization and new business models. Go-Jek The most successful, innovative companies understand that trust, value and wealth are created through the creation of dynamic ecosystems, instead of the static, hierarchical management of workers and products. Large and established companies also recognize these opportunities, but they continue to rely on existing structures, processes and procedures. It is hardly surprising that the shift to a digital age has proven enormously challenging for them. This brings us to the role of regulators and other policy makers. They also need to re-think every aspect of what they have been doing and focus on ensuring that the regulatory environment is conducive to building and maintaining flourishing business ecosystems. Of course, this is much easier said than done. All levels of government struggle to adapt to the fast-changing realities of the digital age. Rapid technological change makes it difficult to identify and agree on an appropriate regulatory framework. The result is that regulations often prohibit, or otherwise limit, the commercial exploitation of the opportunities created by constant technological innovation. experienced this in December 2015 when the transport minister of Indonesia stated that “ ” are illegal. Fortunately for ’s ecosystem, the President intervened and rescinded the statement. Go-Jek services that demand payment using a private vehicle Go-Jek No doubt, this was the right thing to do. Ecosystems can be fragile — especially in an early stage — and clumsy regulatory action can have terminal effects. The lesson? Regulators should not interfere before they have developed a better understanding of their role in this new world of business ecosystems. And, what is that role? Well, that is a story for another day. Thank you for reading! Please push the “heart button” or leave a comment. There is a new story every week. So if you follow me you won’t miss my latest insights about how the digital age is changing the way we live and work.