Product Design vs Platform Design for Software Development

An enterprise architect must understand the business's need for building either a platform or a product. A product is software that has “off-the-shelf,” more generic features and functions. In contrast, a platform is a software or service that allows external parties to extend and develop complementary functions and services. Choosing the right fit for business needs is extremely important after careful consideration of factors for driving product/platform development. 

Platforms are more flexible in connecting two or more parties, usually called producers and consumers. In recent days, organizations have been more focused on building digital platforms or digital products based on the business vertical's needs. While anyone can build products on top of a platform, the platform itself is not the product. The program perspective difference between product and platform is important for project strategy, execution, and stakeholder management. The table below shows the difference between the product and the platform. 

If any business wants the customer journey to cross all channels and markets, the architects should adopt platform thinking for developing the future of the service. This approach provides the reusability of underlying technologies and data platforms with a focus on efficiency, consistency, stability, and security. 

Platform teams operate like product teams. A vision and road map have been created to set the objectives of the platform team linked to business outcomes. Some organizations run product and platform teams, and the platforms can connect to the product to fetch the data the business needs. Banking organizations currently leverage disparate IT products and solutions to support their banking, financial, and operational tasks, which often contribute to data discrepancies, among other inefficiencies. Platforms may integrate data from different applications, helping to create consistency of data. In the platform approach, the end user can access the data from a single entity, i.e., a single point of truth. The platform APIs can be extended by third-party applications or other products.

Nowadays, organizations are more focused on platform thinking than developing products due to the advantages of platforms, such as reduced time to market, increased developers’ productivity, reduced complexity, and improved security.  

Benefits of Platform Thinking

An architect's mindset has to shift from product thinking to platform thinking to develop the platform in their business ecosystem. Platform thinking brings the following aspects:

• Individual product-to-ecosystem collaboration model
• Access to APIs for more convenience and flexibility
• Decentralized orchestration
• Allows other systems to build provides on top of the platforms
• Adopts the market changes quickly

The platform development model accelerates the speed of the delivery. This is achieved by adopting best industry practices, patterns, and technology through the emphasis on reusing rather than building new code. Below are some of the guiding principles for designing the platform:

• Automation of process
• Repeatable
• Small unit planning and deliverables using agile
• Level of control and governance
• Build once and deploy wherever required
• Self-service build
• Traceability  

The design thinking framework helps the enterprise architects develop realistic and pragmatic platforms. Platform design requires discipline to learn, tailor, extend the future, and use the APIs and methods. 

Platforms are more focused on speed to market rather than efficiency. Architects have to adopt a balanced approach when choosing a platform or product. Architects have to decide on a platform or product design based on how big the ecosystems and maturity of the developers around the applications are, along with the stability of the APIs built around. Platform design thinking focuses more on board scope, long-term vision, and the effect of other ecosystems. On the other hand, product design thinking is more focused on less scope, short-term vision, and application-centric.

Choosing the Right Model

Choosing the right design model is important, and factors like industry and market demand for functions and futures, availability of resources in the organization, revenue goals, and end-user experience should be considered. Choosing between a product or platform model is a crucial decision with business implications. Each model offers unique strengths and challenges, and the right choice depends on resources, market dynamics, and business goals.