Strategy & Best Practices

Executive Q&A: How to Move from a Product-Focused Company to a Platform

By Ideas @ AppDirect / April 11, 2019

iCIMS is a leading provider of cloud-based talent acquisition solutions that customers use to attract, engage, and hire employees. Founded in 2000, iCIMS supports 4,000 customers who hire 4 million people each year and is the largest software provider dedicated to talent acquisition. 

Last year, iCIMS launched UNIFi, a centralized platform that enables developers to integrate third-party applications within the iCIMS platform, build new applications that work with its recruiting software, and offers nearly 140 solutions spanning more than 20 categories to customers through a marketplace. UNIFi was recently recognized as a "Best Advance in Talent Acquisition Technology" by the Brandon Hall Group.

Recently, the company's Portfolio Director, Anders Farrugia, sat down with AppDirect's GM of Platform Services, Emanuel Bertolin, to talk about iCIMS's transition from being a product-focused company to platform with a thriving ecosystem of developers. The following is an edited version of their discussion.

To hear the full conversation about iCIMS’s journey to becoming a platform company, watch our on-demand webinar “How to Succeed with Digital Platforms."

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Q (AppDirect): Why did you decide to pursue a platform and ecosystem strategy?

A (Anders Farrugia): When I joined the organization three years ago, we had several opportunities and harsh realities. We had a growing platform and a user base that was begging for integrations into our application. These integrations were all around talent, things like "I need to background‑screen my potential candidates. I need to run assessments on them. I need to post my jobs on job boards."

We knew that our customers were asking for these functionalities, but we were running a professional services operation and business. We really didn't understand why they were integrating. What was the value? And what were the growing implications as we continued to scale?

"We knew we're onto something. The integrations were valuable. But we weren't being thoughtful about it."

We knew we're onto something. The integrations were valuable. We had the right workflow. We had an ability for our partners to augment and improve our application. But we weren't being thoughtful about it. We asked, “Could we start to standardize these integrations so that our customers didn't have to think about it so much?” A platform, and an ecosystem to support it, was the answer.

Q: You specifically decided not to use system integrators (SIs) to address these issues. Can you explain why?

A: If you look at some of our competitors, or just in human capital management in general, they might lean on their SIs to solve the problem and say, "Yeah, we'll make anything work for you, but it will cost you a few bucks, and more than a few bucks, put a couple of zeros on it, to make it work."

We asked ourselves, "Well, do customers actually like that? What could we do to do better? How can we create value?” Let's actually focus on the experience of our actual customer as they go through their journey on our platform. That's really where we decided that a platform was the right way to go. 

Q: What are some of the key factors organizations should consider when thinking about platform technology?

A: It really comes down to this concept of ease, and I preach this to all of my teams. If we're going to deploy or create any value, it has to solve a problem or be effective. It should be automated, not be done with people. If we can do it without people, the better for us.

"If we're going to deploy or create any value, it has to solve a problem... It should be automated."

Overall everything needs to be simple, because IT, tracking entitlements, purchasing products, creating statements of work, and managing products is complex. We should drive for simplicity, and ultimately be efficient, and efficient not just in the ordering process, but also in usability of our application.

Q: At first, the software vendors you work with were skeptical of your ecosystem strategy. How did you convince them it was valuable?

A: We wanted our software vendors to be able to sell to our customers through us, to focus on building, entitlement, the ability to market for our vendors, and make that a part of the ecosystem program. We went to test that with our vendors and they said, "You're getting involved in my buy chain. This is weird."

We're able to articulate to them, "Do you like contracting?" No. "Do you like marketing through Google SEO and spending all of this money on cost of acquisition when you have a buying customer right here?" No. Ultimately, we just want to talk to your customer for you to make the buying process easier. 

Sure enough, the software vendors turned around and said, "Yes, this definitely works for us.” This business case works especially well if you're growing your subscriber base.

Q: What benefits does a platform strategy deliver?

A: When you start to automate, and you take people out of the process as much as you can, you get to unlock a level of scalability that was impossible before. And the way you win is finding scale. It's about having people wanting to innovate on your platform and making those products sticky, and then the platform acts as a rising tide that lifts everyone up.

It's not about making more money than your software partners, or completely owning the total purchasing power of your subscriber. It's about making sure that the experiences that you're delivering are easy, or that they're efficient, they're simple, they're automated, and everybody wins. This is a real key tenet of what Atlassian and Salesforce are doing. They make sure that their partners are more profitable than they are through the platform experience.

Not only that, but our pre‑sales engineers are spending less time talking to the customers about how to do something, and more time offering strategic advice. That starts to raise the entire value of what iCIMS brings to our customer base.

"We have not had to grow our pre‑sales SE organization as our company went from 2,000 customers to 4,000." 

We’re also impacting the operations and business of iCIMS by bringing in deployment technology. On the frontend of it, we have not had to grow our pre‑sales SE organization as our company went from 2,000 customers to 4,000. Then, on the software vendor side, our referral business has grown 40 percent year over year for the past three years since we started building out our platform strategy.

Q: What are your recommendations for other companies considering a platform strategy?

A: You've got to think about scale. If you’re doing 10 partners now, what happens when you do 1,000 partners? You can’t have legal redlines, and that's the same when it comes down to automation. When your customer is going to make a purchase, do they need a paper‑based process and a big complicated discounting scheme, or can they just try or buy it now? 

Also think about measurement. If you don't know how or what to measure, then you at least need to have a hypothesis to test. Say, "Okay, we've made this investment. Are things getting better for you guys? Is it speeding up the process, is it easier to sell or deploy a product?” Continually ask the question, and if you're not getting a yes, then you're probably not doing the right things.

It’s also important to know that taking a phased approach is okay. If you try to eat the elephant out of the gates, if we went for an automated fully "buy now" experience that's API‑based and yada, yada, yada, we would have never gotten started. Focus on one area to start.

All of us have limited resources. We've got limited smart people and intelligence. We'd love to have an unlimited budget, but it's just not reality. From a product perspective, what we've done is focus around a unified strategy and made the decision to invest where we truly want to differentiate.

Q: The “build versus buy” question always looms large for companies that are considering a platform strategy. Why did you decide to partner with AppDirect?

A: The first question we asked ourselves was: "Is it really a value differentiation if we had to build the technology?" And the answer was no.

We asked ourselves was: "Is it really a value differentiation if we had to build the technology?" And the answer was no.

The second question we asked was: "Do you want to keep a product team, a strategic research team, and everybody looking at the market and where it's going to stay ahead of what we need from today?" That really made our team say, "Oh, yeah. That's not too exciting to us."

Just be honest with yourselves and say, “Yeah, we have software developers, and we’re building the best application tracking system. But platforms are not our expertise.” I think that's why we were able to have a good, honest conversation below our CTO, at our engineering level, and we said, "There's another way. Let's investigate the buy option."

Our space to innovate is in talent and inside of our application and our workflow. Can we find a partner that thinks like us and can somebody do this marketplace thing? That's how we came to find AppDirect and launched our iCIMS UNIFi Marketplace. And we're seeing some great results.

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