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THE ROLE OF USER-CENTRIC DESIGN IN GLOBAL

PLATFORM ECONOMY VALUE CREATION

Master’s Thesis

Leevi Lindfors & Kalle Perälä

Aalto University School of Business

Global Management

Spring 2024

Aalto University, P.O. BOX 11000, 00076 AALTO

www.aalto.fi

Abstract of master’s thesis

Authors Leevi Lindfors & Kalle Perälä

Title of thesis THE ROLE OF USER-CENTRIC DESIGN IN GLOBAL PLATFORM ECONOMY

VALUE CREATION

Degree Master of Science in Economics and Business Administration

Degree programme Global Management / CEMS Master in International Management

Thesis advisor(s) Daria Kautto

Year of approval 2024

Number of pages 60

Language English

Abstract

This research focuses on how digital platforms should be designed and what kind of design

aspects must be considered when building and managing a digital platform. Design is an

important part of software development due to its ability to affect users’ willingness to pay for

their desired service or good online. When designing a global digital platform, designers must

consider the whole customer life cycle to create the optimal software solution. The research

explores value creation in the digital platform economy, and how the value creation can be

achieved by utilizing user-centric design principles. Both user-centric design and value creation

are relevant for managing and growing digital platforms internationally. Many of the most

significant players in digital platform industry are multinational enterprises, such as Uber,

Meta, and DoorDash. Significant digital platforms can be described as global platforms that

operate in either social media, transport, or asset-sharing service industries.

Since value creation is a crucial part of business, the research focus is on design features and

processes that generate value for customers and other stakeholders within the digital platform

economy. The research is divided into two parts. The first part introduces the current academic

understanding of value creation and user-centric design practices while highlighting the concept

of user life cycle management in the literature review. The literature review and existing

conceptualizations serve for further development of the conceptual framework of the study. The

second part of the research consists of findings from eight one-hour long expert interviews

which have been anonymously conducted in a narrative and semi-structured matter. The

findings are then analysed together with the academic literature in the discussion part. The

research provides a final conceptual framework that can be used to manage user life cycle in

digital platform product development.

Keywords User-centric Design, Value Creation, User Life Cycle, Digital Platform, Innovation

iii

Table of Contents

1. Introduction ................................................................................................................ 1

1.1. Background ........................................................................................................... 1

1.2. Key Definitions ...................................................................................................... 3

1.3. Research Questions .............................................................................................. 5

2. Literature Review ....................................................................................................... 6

2.1. Value Creation ..................................................................................................... 6

2.1.1. Value Creation Spheres ................................................................................. 7

2.1.2. Value Co-Creation Between Stakeholders ..................................................... 9

2.1.3. Digital Service Design in Value Co-Creation ................................................ 11

2.1.4. Value Co-Destruction Between Stakeholders .............................................. 16

2.1.5. Customer Life Cycle Management in Value Creation ................................... 18

2.2. User-Centric Design ............................................................................................ 22

2.2.1. Understanding User-Centricity in the Design Process ................................. 22

2.2.2. User-Centric Design and User Experience in the Digital Platform Economy 23

2.2.3. User-Centric Design Practices in the Digital Platform Economy .................. 25

2.2.4. Feature Personalization for Scalable Digital Software ................................. 27

2.2.5. Managing Feature innovation Within Software Development ....................... 29

2.5. Conceptual Framework ....................................................................................... 31

3. Methodology ............................................................................................................. 34

3.1. Analysis Method .................................................................................................. 34

3.2. Data Collection Method ....................................................................................... 38

3.3. Limitations and Ethical Considerations ............................................................... 39

3.4. Interviewees’ Background ................................................................................... 40

3.5. Interview Guide ................................................................................................... 41

1. ............................................................................................................................. 41

4. Findings .................................................................................................................... 41

4.1. Findings from Industry Professionals .................................................................. 42

4.1.1. Value Creation .............................................................................................. 42

4.1.2. User Life Cycle Management ....................................................................... 46

4.1.3. User-Centric Design ..................................................................................... 49

4.2. Revised Conceptual Framework ......................................................................... 53

5. Discussion ................................................................................................................ 56

5.1. Similarities Found from Literature Review and Expert Interviews ....................... 56

5.2. Managerial Implications ...................................................................................... 58

5.3. Applicability to International Business ................................................................. 59

5.4. Suggestions for Future Research ....................................................................... 60

References ................................................................................................................... 61

Appendix ....................................................................................................................... 69

Appendix 1: Interview Guide ...................................................................................... 69

Questions About the Interviewee ............................................................................ 69

Questions About Global Platform Economy ........................................................... 70

Questions About Value Creation in General ........................................................... 70

Question About User-centric Design and Managing Software Development ......... 70

1. Introduction

1.1. Background

Design is an important part of software development due to its ability to affect users’

willingness to pay for their desired service or good online. When designing a global digital

platform, designers must consider the whole customer life cycle to create the optimal

software solution. There are many unknowns in the field of global digital platforms. For

example, the concepts of new feature adoption and feature personalization is not typically

discussed upon in the academic literature as opposed to new application adoption.

However, it is vital to understand as many digital platforms must constantly update their

software to make sure their platform co-creates value in the future. This is why the

research intends to enhance the understanding of how different user-centric design

choices affect the digital platform economy and how value creation typically works in the

current business environment. The researchers have established a consumer brand start-

up called Taskify, which is a transactional digital platform that targets both households

and professional service segments. Building a start-up encouraged the researchers to

explore the elements of digital platform design in more detail by making them aware how

just a small design detail can have a huge impact on the user satisfaction. Due to the

existing presence and involvement in the digital platform economy while finding a possible

market fit for Taskify. digital platform design and value creation was found to be optimal

contribution to the existing academic research, while also helping the researcher

understand what type of design features to add and include in the user interface. Both

user-centric design and value creation are relevant for managing and growing digital

platforms (Hassenzahl & Tractinsky, 2006; Carroll, 2012; Lallemand et al., 2015,

Rodríguez-Vilá et al., 2020).

Nowadays digital platforms like Airbnb, Uber or Meta are common in the service sector

(Ruutu et al., 2017; Kirchner & Schüßler, 2020) and they have grown to be enormous

companies. According to CIA (2024) around 63% of the world’s GDP is generated though

services and the service sector is the biggest driver of GDP. Furthermore, one of the

largest industries alongside social media is gig economy within the digital platform

segment (Mastercard, 2020; Business Research Insight, 2023A; Business Research

Insight, 2023B; Statista, 2024). Gig economy platforms’ market size is globally estimated

to be around 14 750 million USD in 2021 and is expected to reach 92 897 million USD by

2031 (Business Research Insight, 2023A). Another report that considered digital

platforms more broadly estimated the market size of the global gig economy to be around

355 000 million USD in 2021 and expected it to reach 1 864 000 million USD by 2031

(Business Research Insight, 2023B). Either way, the market size of gig economy platform

is large and growing at a fast pace (Business Research Insight, 2023A; Business

Research Insight, 2023B). Many of the most significant players in digital platform industry

are multinational enterprises or MNEs in the economy such as Uber, Airbnb, and Meta.

Significant digital platforms can be described as global platforms that operate in either

social media, transport, or asset-sharing service industries (Mastercard, 2020).

One reason why many global digital platforms have grown big is thanks to good business

and platform design. User Experience and User Interface are all concepts linked to user-

centric design practices and they directly involve the user by influencing the perceived

value that the users gain from using the platform. User-centric design practices that lead

to value creation have a crucial role in the society due to their ability to co-create value.

Since value creation is a crucial part of business (Volkov & Garanina, 2007), one of the

focuses in the research is on design features and processes that generate value within

the digital platform economy. The other research focus is on how to generate value for

customers, while making sure all stakeholders within the digital platform are adequately

considered. The research is divided into two parts. The first part introduces the current

academic findings about value creation and user-centric design practices while

highlighting the concept of user life cycle management. The research literature consists

of articles from management journals, while also covering some information systems

journals. Existing conceptual frameworks that define factors that affect value creation and

user-centric practices will be referred to in the study when they are relevant for the

research and help the understanding of key concepts. The second part of the research

consists of findings from eight one-hour long expert interviews which are then analysed

together with the academic literature in the discussion part. The eight experts are working

or have been working with digital platforms for many years and have made valuable

contributions to the field. Every expert has been anonymized and given different names

to make them unrecognizable. All in all, the research focuses on how digital platforms

should be designed and what kind of design aspects must be considered when building

and managing a digital platform. The research provides two conceptual frameworks that

can be used to manage user life cycle in digital platform product development. The first

conceptual framework is constructed based on only the existing academic literature, while

the second conceptual framework is a revised version of the first framework. The second

framework will be based the additional findings from the industry experts, and it can be

used as a general visualization of how digital platforms are able to create value with user-

centric design practices while keeping in mind the whole life cycle of the user.

1.2. Key Definitions

Digital platform refers to an IT infrastructure which facilitates different interactions and

transactions between different users while providing an easily accessible digital context

for buying and selling of both goods and services through a digital interface (Deloitte,

2019; Gawer, 2021; European Commission, 2022). According to European Commission

(2022) Digital Platforms increase consumer choice, improve efficiency and

competitiveness of an industry, and can enhance civil participation in the society. Firm

scope is one of three key pillars that defines Digital Platforms (Gawer, 2021). Firm Scope

refers to the extent of which the firm operating the platform goes beyond traditional

organisational boundaries such as external partners and users. Digital Platforms typically

have many sides that interact with each other which in turn create value through network

effects such as consumers and producers being able to connect efficiently. Digital

interfaces are important for the platform, and they must be effective while providing a

seamless UX to enable value creation (ibid.).

Value Creation in Digital Platforms happens through interactions between stakeholders

on the platform (Grönroos & Voima, 2013). In digital platform value creation, the service

provider helps the customer, value creator, to create value based on the needs of the

customer (ibid.). Value creation is identified as one of the key concepts in the success of

platform-based business models (Rohn et al., 2021). The development of information and

communication technologies has established new ways of generating value in the digital

platforms (ibid.).

Data Network Effects identifies the value of data collection in digital platforms (Gregory

et al., 2021). The value of the platform increases as the number of people using the

platform increases. The more people use the platform, the more data the platform is

collecting from the daily activities of the users. The data network effects realize when the

collected data is utilized to train data models of the platform. (ibid.)

Customer Life Cycle Management or CLCM for short, takes care the customer

experience from acquiring the customer to the customer retention (Lee et al., 2017).

Knowledge management, KM, and customer relationship management, CRM, relate to

the CLCM. The KM is about the transfer of existing company knowledge between internal

stakeholders while the CRM manages the current relationship between the customers.

The KM helps CLCM to understand the existing customers and adjust the CLCM

operations, like customer retention and new product development, according to the needs

of the customers. In turn, the CRM manages current relationships with customer in

ongoing basis and CLCM as a part of CRM contributes to the success of CRM. (ibid.)

Customer Lifetime Value or CLV for short, looks at the economic value of the customer

overtime (Kumar & Reinartz, 2016). The CLV model predicts how much economic value

for the company each customer is creating over their lifetime (ibid.). The CLV predicts the

future value of revenue per customer. The CLV can be used to justify the CLCM costs,

like customer acquisition costs (Kumar & Reinartz, 2016; Lee et al., 2017).

Human-Computer Interaction or HCI for short, explores how computers and software’s

interact with people (Carroll, 2012). HCI highlights the necessity of user-centred design

principles in software development since it drives users to adopt the software (ibid.).

According to Benyon (2014) the interdisciplinary nature of HCI means that it focuses the

understanding of many factors that make IT systems usable, effective, and enjoyable for

people.

1.3. Research Questions

This study answers to three research questions. These three research questions explore

value creation in the digital platform economy, and how the value creation can be

achieved by utilizing user-centric design principles. The role of business processes in

value creation will be discussed in the study, which considers managerial perspective on

how to promote value creation within the design process where it might fail to do so. The

research questions make identifying different factors within the design possible by

mapping them into a timeline that is customer life cycle.

• What is the role of user-centric design principles in the global digital platform

economy?

• How can IT management processes support both user-centric design and value

creation?

• What kind of User-Centric Design practices could be identified along the Customer

Life Cycle?

2. Literature Review

2.1. Value Creation

Digital platforms modify the way people exchange goods, and services with each other.

The platforms reduce transaction costs between the parties by providing digital interface

where the trade happens (Hein et al., 2019). The digital platforms bring the trade from

traditional marketplaces to online where people can interact with one another and

exchange goods and services from home (ibid.). Also, the digital platforms are able

connect resources of parties even beyond country borders easily, and hence ease the

barriers for trade (ibid.). The network effects increase the value of the platform for each

user as the userbase grows (Gregory et al., 2021). Further, the data network effects

presented by Gregory et al. (2021) increase the value of the platform for each user as the

amount of data gathered from platform activities grows. With the continuous data

collection, the platform learns to serve its users better according to their needs (ibid.). The

platforms create value in multiple ways and introduce new value creation mechanisms

that were non-existent beforehand (Hein et al., 2019, Gregory et al., 2021). The digital

platforms re-design the value creation in the economy by introducing new type of digital

ecosystems (Autio et al., 2018).

Grönroos & Voima (2013) divide value based on the interactions between the

stakeholders in the value creation context. Instead, Rodríguez-Vilá et al. (2020)

emphasizes more of how both the customer and company value can be created and what

kind of possibilities there are for the value generation both for customer and company

rather than looking at the relationship between customer and company. Although

Rodríguez-Vilá et al. (2020) does mention how the companies should track data and

analyse the effectiveness of value creation in the case of marketing, the discussion of

how the value is created within the stakeholders is less focused on. Rodríguez-Vilá et al.

(2020) focuses more on the business side of value creation and how can marketeers

approach the value creation from the point of view of an organization, whereas the

Grönroos & Voima (2013) discusses on the value creation from customer’s point of view.

In the article written by Grönroos & Voima (2013), the concept of value creation introduced

is heavily based on the customers willingness to use and pay for the service. Therefore

Grönroos & Voima (2013) indirectly say that in value creation customers should be the

key focus, whereas the business is more in a facilitator role. Both the Grönroos & Voima

(2013) and Rodríguez-Vilá et al. (2020) provide good basis for understanding the value

creation, and how the value creation should be viewed both from the perspective of

customer, and organization while taking into account the other stakeholders such as

service providers, and potential knowledgeable strategic business partners, like start-ups,

to enhance the value creation.

2.1.1. Value Creation Spheres

Figure 1: Value Creation Spheres. (Grönroos & Voima, 2013)

Grönroos & Voima (2013) discuss further about how the value creation process can be

divided into a provider sphere, joint sphere, and customer sphere (Figure 1). The idea of

a provider sphere is to act as a value facilitator and to help the customer to co-create the

value together with other actors by providing digital platform to use for instance (ibid.). On

the other hand, the customer sphere is about acting independently and using the existing

service to provide the value (ibid.). The customer sphere is also referred to as value in

use. In the value in use the customer determines how to perceive the service or product,

and builds thoughts based on the experience (ibid.). Moreover, the joint sphere is about

value co-creation bringing together the resources of provider sphere, and customer

sphere, and interacting with one another to create value (ibid.). The value creation

spheres represent elements of the value creation logics, and the logics explain how the

value creation happens in the value creation process (ibid.). Understanding the concept

of value co-creation discussed in Grönroos & Voima (2013), Alqayed et al. (2022), Bal et

al. (2023), and Tuunanen et al. (2023), and value co-destruction discussed in Lintula et

al. (2017), Järvi et al. (2018), and Sthapit & Björk (2019) help to understand value creation

logics within the value creation spheres. Upon the interaction of independent resources,

customer and provider sphere, the value creation process moves into joint sphere and

the value co-creation begins (Grönroos & Voima, 2013).

The importance of interaction comes up in the value creation sphere framework

(Grönroos & Voima, 2013). Grönroos & Voima (2013) recognize that interaction is part of

the value creation process and is crucial for the value co-creation to happen. Sthapit &

Björk (2019), Algayed et al. (2022), Bal et al. (2023) and Deloitte (2019) recognize

interaction to be prominent in value creation. The interaction between the stakeholders is

strongly part of the value creation process (ibid.).

2.1.2. Value Co-Creation Between Stakeholders

According to Grönroos & Voima (2013), value creation consists of at least two

stakeholders, the customer and service provider. The interaction between the

stakeholders creates value (ibid.). This phenomenon is also referred as the co-creation

of value (ibid.). The stakeholders in the value creation process create the value together

by interacting with each other rather than operating independently (ibid.). In digital

platforms the co-creation of value goes beyond the single firm, and hence the process of

value creation is redesigned (Grönroos & Voima, 2013; Rodríguez-Vilá, 2020). In digital

platforms there are multiple distinct stakeholders in place which co-create the value on

the platform together (Bal et al., 2023). The platform provides the convenient playground

for the interaction between stakeholders, which co-create the value (ibid.). The degree of

value co-creation depends on how the stakeholders perceive the platform in use (Alqayed

et al., 2022). According to Alqayed et al. (2022) the perceived quality of the platform, and

proper resources integration has a significant effect on the degree of value co-creation.

The high-quality platform builds trust among customers while encouraging customer to

engage in the digital context more by sharing their resources (ibid.). Also, the platform

quality drives the positive perception of the platform, which is important as customers

prefer high quality platforms over less established ones (ibid.). On the proper resource

integration, the convenient customer experience is in important role to further strengthen,

the trust, and positive customer experience in the platform (ibid.) Whereas Grönroos &

Voima (2013) elaborate on the importance of customer interaction leading to the value

co-creation, Algayed et al. (2022) discuss on the factors supporting the customer

interaction, like offering high quality service platform. The understanding of the value co-

creation has advanced over the years based on the literature where article written by

Grönroos & Voima (2013) is one of the first in the field of value co-creation.

The value creation mechanisms differ between transaction and innovation platforms

(Gawer, 2021). According to Gawer (2021) digital platforms are divided into transaction,

and innovation platforms. The transaction platforms facilitate the exchange of goods and

operate as intermediaries between the parties. In turn, the innovation platforms help other

parties to innovate by utilizing the existing platform. Whether the platform becomes an

innovation or transaction platform depends on the platform design. Also, there are hybrid

platforms, which have characteristics of both the transaction platforms and innovation

platforms. For instance, Amazon is given as an example of a hybrid platform where

products are exchanged between parties but also the parties can start to utilize the

Amazon Web Services while hosting their ecommerce mobile application. The value

creation of the transaction platform is based on the exchange of goods and services,

whereas in the innovation platforms the value creation requires innovativeness support

from the platform users. Without the further innovations, the innovation platforms fail to

create value, whereas the transaction platforms still thrive as long as parties keep

exchanging the goods and services with one another. (ibid.)

2.1.3. Digital Service Design in Value Co-Creation

Tuunanen et al. (2023) build up on the value co-creation concept discussed in Grönroos

& Voima (2013). In the research article, Tuunanen et al. (2023) discuss about the five

mechanisms that support the value co-creation in the design of digital services. The

mechanisms identified are social use, customer orientation and decision making, service

experience, service use context, and customer values and goals (ibid.). By taking the

mechanism into consideration when designing the digital service, companies can

increase their customer’s service experience, and hence increase the value co-creation

further (ibid.). Tuunanen et al. (2023) identifies that the digital service design is important

part of value co-creation and should be taken into a consideration, especially nowadays

when the services are being digitalized.

Tuunanen et al. (2023) study is a qualitative study, where 113 interviews were conducted

from 5 different organizations. The companies were either business-to-business, B2B, or

consumer-to-consumer, C2C, oriented. For instance, online CRM system, and online

system for geocaching hobby were chosen as organizations. The users of the

organizations were interviewed to understand how the users think about the digital service

they are using. The research question the study aims to answer is: “What micro-level

mechanisms of value co-creation support the design of digital services and how they can

be identified?”. (ibid.)

In the figure 2 is seen the value co-creation mechanisms, which can be utilized to increase

the user’s service experience. The constructs are in the circles while the

interdependencies are illustrated with arrows. There are 5 pathways identified in total,

which are numbered from 1 to 5 in the figure 2. The pathways 1-4 lead to values and

goals constructs while the 5 pathway represents the linkage between utilitarian values &

goals, and hedonic values goals constructs. The Ps in the Figure 2 represent the

propositions, which are linked to the mechanism. The P1 propositions relate to the social

service use, P2 propositions relate to the customer orientation and decision making, P3

propositions relate to the service experience, P4 propositions relate to the service use

context, and P5 propositions relate to the customer values and goals. The key constructs

are numbered in the figure 2 from 1 to 11. Tuunanen et al. (2023) suggest that P1-P4

pathways are linked to the customer’s values and goals constructs, P5. (ibid.)

Figure 2: “Value co-creation mechanisms and propositions.” (Tuunanen et al., 2023)

Tuunanen et al. (2023) lack clear definitions on what is meant by the mechanisms

identified. However, based on the descriptive examples of consequence and value codes

on the constructs, and inspecting the value co-creation mechanism pathways presented

in figure 2 some level of explanation is implied in the study. The social use is about how

the users perceive the digital service themselves and discuss upon about it with the

surrounding stakeholders. The customer orientation and decision making are about

understanding the user’s needs, informing users, and offering support for users. The

service experience is about how user feels using the service, and how motiving the usage

of the service is on the user. The service use context refers to how the underlying context

where, and when the service is used affects to the value co-creation. Lastly, the customer

values and goals are divided into utilitarian values and goals and hedonic values and

goals. The customer values and goals imply the importance of understanding whether

user values more practicality in the use of services or the feeling of satisfaction and

enjoyment in the use of services. (Tuunanen et al., 2023)

Tuunanen et al. (2023) also state that the mechanisms to enhance value co-creation

depend on the type of digital service, and more specifically compares the differences

between business-to-business, B2B, and customer-to-customer, C2C, service types. In

the study, B2B digital services mean that only businesses interact with one another,

whereas in C2C the digital services are customer oriented and so the interactions as well

(ibid.). The C2C types were digital services for metal detecting, and geocaching hobbies,

whereas in B2B the services chosen were mining equipment system, customer

relationship platform, and event planning platform in the study (ibid.).

The choices of how to design the service on ongoing basis should be thought carefully,

as the costs of the constant design chances can outweigh the added value (Tuunanen et

al., 2023). The economic viability of the service is an important topic raised in the article

and it should be considered by businesses as well (Ibid.). Although new changes in design

might seem to only benefit the customer, the business should think of the long-term

implications of each design choices when it comes to value creation (ibid.). From the

perspective of value creation, one should think both the customer and the company value,

like introduced in by Rodríguez-Vilá (2020) and align the service design practices based

on what creates value for both the customer and the company in the long term.

During the research Tuunanen et al. (2023) conducted multiple interviews with the chosen

companies that operated either in B2B or C2C digital services. Further, qualitative data

was coded, and key constructs were identified based on which the value co-creation

mechanisms were found. The study is only based on the five digital services so the

findings may not be applicable to the design of all digital services. While the study well

elaborates on the design mechanism, the practical implication of how to apply the

mechanisms is lacking. (ibid.)

The mechanisms identified by Tuunanen et al. (2023) affected on the B2B, and C2C

digital services. Some mechanisms mainly affect B2B digital services such as customer

orientation, and decision making (ibid.). In turn, some constructs in the mechanisms, like

service experience construct has nearly equal impact on both B2B and C2C digital

services (ibid.). The study conducted by Tuunanen et al. (2023) gives perspective on the

micro-level mechanisms affecting the value-creation in the digital services at a design

level. Tuunanen et al. (2023) build up on the value creation spheres presented in

Grönroos & Voima (2013) by identifying which mechanisms can increase the customer’s

service experience, and hence value co-creation. Tuunanen et al. (2023) argue that

exploring the identified mechanisms, and interdependencies, illustrated in the figure 2

with arrows, help to understand how and why the value is co-created in digital services

on the joint sphere presented by Grönroos & Voima (2013).

Tuunanen et al. (2023) presents the value co-creation mechanisms and suggest how

digital services are perceived by digital service users, and how value co-creation can be

increased by acknowledging the mechanisms. In turn, Gregory et al. (2021) discusses on

leveraging data in digital platforms and discusses that user-centric design is important

part of the leveraging the platform data. Gregory et al. (2021) touches on the digital

service design upon discussing on the ways of increasing the value of the platform with

data collection.

Study written by Gregory et al. (2021) discusses on the leverage of the artificial

intelligence, and data in value creation. The data-based value creation could help the

value co-creation mechanisms identified by Tuunanen et al. (2023). For instance, the data

predictions made by artificial intelligence, AI, can help in understanding the customer’s

needs, which is important in the customer orientation and decision-making mechanism

(Gregory et al., 2021; Tuunanen et al., 2023).

Figure 3: Data-based value creation. (Gregory et al., 2021)

The figure 3 illustrates how a platform benefits from data network effects. The network

effect means the more people use the platform the more valuable it becomes to its users

as they create value together (Gregory et al., 2021). Gregory et al. (2021) extends the

network effect definition by presenting data network effects. In data network effects, the

amount of data the collected increases the value of the platform. The more the platform

learns from the data collected from the user activities within the platform, the more

valuable the platform becomes to each user (ibid.).

“The data network effects themselves are manifested in the positive direct relationship between

the AI capability of a platform and the value of the platform as perceived by its users—a

relationship that is moderated by platform legitimation, data stewardship, and user-centric design.”

-Figure 3 (Gregory et al., 2021)

The more data the platform has available to train the internal data models, and the higher

the quality of the data is the better the platform will be in predicting platform activities

(Gregory et al., 2021). The design of the platform further helps to bring up the benefits of

the AI prediction models to users and increase the perceived value of the customer (ibid.).

Moreover, the increase perceived value can contribute to the increase in the service

experience and increase in value co-creation (Gregory et al., 2021; Tuunanen et al.,

2023)

2.1.4. Value Co-Destruction Between Stakeholders

According to Lintula et al. (2017) value can be co-destructed as well along with co-

creating value. Occasionally the relationship between the customer, and the service

provider might experience some flaws, and setbacks while the value in exchange might

lack (Grönroos and Voima, 2013). The research on value co-destruction is more limited

compared to value co-creation, although value destruction tends to happen now and then.

Lintula et al. (2017) divide the value co-destruction into orientation, resources, and

perceptions. Value co-destruction can happen for instance due to contradictions of values,

misuse of resources, and insufficient perceived value (ibid.).

The misuse of resources happens for instance when the company fails to deliver on time

due to the lack of proper use of existing supply chain network and set processes (Lintula

et al., 2017). Insufficient perceived value is about the customer perception and customer’s

expectation on receiving certain level of service, and hence in turn expects to be served

with similar level of service on other occasions as well (ibid.). In the contradictions of

values, the customer challenges the way the organization operates in (Grönroos & Voima,

2013). Many companies state values on their website but fail to act according to the

values (Sull et al., 2020). Sull et al. (2020) discusses on the importance of internal

communication upon the company values as a way to improve the transparency of values

for stakeholders, like customer (ibid.). Furthermore, the correlation between the

company’s official values, and corporate culture is often non-existent (ibid.). Sull et al.

(2020) suggests aligning the values stated and company culture. The value alignment,

and being transparent is part of stakeholder management, and strengthens the trust with

stakeholders, like customers (ibid.). The contradiction of values, misuse of resources, and

insufficient perceived value can be enhanced by companies with proper operational

practices, consistent stakeholder management, and a high service quality (Lintula et al.,

2017; Sull et al., 2020).

In the study written by Sthapit & Björk (2019), the value co-desctruction is discussed from

the perspective of digital platforms, and especially from Uber’s point of view. According

to the study poor customer service, and Uber drivers’ misbehaviour where the most

significant factors leading to value co-destruction (ibid.) Also, other errors in the customer

journey, like cancellation of the ride and overcharging has a negative effect on customer

experience, and well-being (ibid.). Also, Järvi et al. (2018) connect the decline in

customers well-being to the value co-desctruction. The poor customer service, and

drivers’ misbehaviour further contribute on resources losses physically, emotionally,

financially or temporally (Sthapit & Björk, 2019). In Uber’s case, the lacking customer

experience was insufficient to meet the expectations of the customers, which eventually

led to value co-destruction (ibid.).

Within digital platforms, the sufficient interaction, and engagement of the customer has

an important role in the service experience (Sthapit & Björk, 2019). Having reliable, and

high-quality customer service within the digital platforms helps to manage the customer

expectations of the service while promoting the positive customer experience (ibid.). The

sufficient education of service providers and minimizing negative customer experiences

help to prevent value co-destruction (ibid.). The platform policies enhance the efficient

use of resources (ibid.). Lintula et al. (2017) discussion on the misuse of resources in the

service dominant logics suits well with the suggestion by Sthapit & Björk (2019) to set

policies for service providers to promote positive customer experience. The learnings

from Sthapit & Björk (2019) can help minimizing the value destruction by addressing the

issue of misuse, and non-integration of services presented by Lintula et al. (2017). In

digital platforms, a well-established customer service, positive customer journey,

education of service providers and suitable platform policies help with the orientation,

resources and perceptions in the value destruction framework to prevent the value

destruction (Lintula et al., 2017, Järvi et al., 2018; Sthapit & Björk, 2019).

The value co-destruction concept introduced by Lintula et al. (2017) adds depth into the

discussion of how the value can be created within the digital platforms. The discussion of

customer value by Rodríguez-Vilá et al. (2020) resonates well with the value destruction

aspect by keeping the customers satisfied and engaged during the buying process of the

service or goods. While Rodríguez-Vilá et al. (2020) identifies some elements which might

explain where the customer engagement and satisfaction comes from, Lintula et al.

(2017) builds up customer value discussion with the concepts in the value co-destruction

framework. The company value, and customer value framework by Rodríguez-Vilá et al.

(2020) can be combined with the concept of value co-creation introduced by Grönroos &

Voima (2013), and value co-destruction by Lintula et al. (2017). While the Rodríguez-Vilá

et al. (2020) emphasize the perspective of an organization in the value creation and the

importance of good management practices in marketing, Grönroos & Voima (2013) and

Lintula et al. (2017) build up on the customer value and give suggestions on what kind of

elements within the customer engagement, and journey should be considered to enhance

the customer value further.

2.1.5. Customer Life Cycle Management in Value Creation

The customer life cycle management sees the interactions between company, and the

customer valuable (Lee et al., 2017). The interactions with customers determine how long

the customers will keep using the product or service. Customer life cycle management

sees customer activities with the company as important, and the customer management

is adjusted based on the type of the customer. Further, the customer life cycle

management increases the customer lifetime value. The customer life cycle management

practices respond to the changing needs of customers and adjusts operating activities

accordingly. Customer life cycle management is part of the customer relationship

management, CRM, which ensures that customers are happy, and continue to benefit

from the product or service. (Ibid.)

Figure 4: Customer Life Cycle Management. (Lee et al., 2017)

According to Lee et al. (2017) knowledge management, KM, and information technology,

IT, has a positive effect on customer life cycle management, CLCM (Figure 4). In turn,

the CLCM affects positively to customer relationship management, CRM. The KM refers

to the transfer of existing internal company knowledge between stakeholders. In CLCM,

the proper knowledge management helps to understand the customers current activities

and adjust CLCM operations in customer acquisition, sales, customer retention and

product development. (ibid.)

The IT enhances transfer of knowledge which contributes to the customer life cycle

management (Lee et al., 2017). However, negative impact is found between the

knowledge protection, and product development. The restriction of employee accessibility

to resources may lead to misalignment of resources. Further, the misalignment of

resources can lead to the less interaction between the employees working on product

development. Each employee has certain level of understanding on the customers

preferences. The restriction might discourage interaction between employees, which is

crucial part of product development where the understanding of customers is required.

Yet overall, the IT does help in knowledge management to ensure good results from

customer life cycle management. (ibid.)

Customer life cycle management together with knowledge management helps to utilize

the customer data and increase value creation (Lee et al., 2017). The utilization of the

customer data can have positive impact on the customer life cycle management, for

instance on the new product development, and new customer acquisition. Accounting

customer data into knowledge management increases the understanding of the

customers among internal stakeholders within the company. Further, the knowledge

management has positive impact on the customer life cycle management. Applying

customer data with the knowledge management and the customer life cycle management

is an example of increasing the value creation with the use of customer life cycle

management. Customer life cycle management together with knowledge management

helps to apply the customer data into the operations. The IT is used in facilitating the

transfer of customer data between stakeholders. (ibid.)

According to Bhargava et al. (2020) the data collection fosters the value creation in digital

platforms and increases competitive advantage when the data is strategically used in the

platform development. The CLCM and KM discussed in Lee et al. (2017) can help in

applying the data strategically to foster the value creation. The internal data sharing

introduced in Bhargava et al. (2020) as part of the data strategy remind of the KM where

knowledge is transferred smoothly between stakeholders. The CLCM and KM discussed

in Lee et al. (2017) can help in applying the data strategically to foster the value creation

(Bhargava et al., 2020).

The CLCM along with KM can help in understanding the right marketing focus, and hence

increase the value creation (Lee et al., 2017; Rodríguez-Vilá, 2020). The ongoing CLCM

and KM can help to understand and react to the changing customer preferences and

therefore bring in valuable information on the customer profiles. Moreover, the customer

profiles can help to determine the right scope for the marketing activities and budget

marketing to support the continuous value creation. (ibid.)

Customer lifetime value can be seen as a tool to measure the effectiveness of CLCM and

even justify CLCM related costs (Lee et al., 2017). In customer lifetime value, CLV, the

company mathematically predicts the future value of revenue from customer spending so

how much economic value is created overtime for the company per customer (Kumar &

Reinartz, 2016). Some CLCM related costs tend to be applied in the CLV model, like

customer retention costs (Kumar & Reinartz, 2016; Lee et al., 2017). There are multiple

CLV-based models in use in differing markets and industries. The CLV estimation is

utilized in evaluating the value creation in operations, for instance in marketing (Kumar &

Reinartz, 2016). The CLV, is calculated for different operating units at the firm or even for

the whole company as one entity (ibid.). Although the CLV is good concept for analysing

value creation, still the CLV lacks to indicate what are the value creation logics to create

the value (ibid.).

The customer life cycle management discussed in Lee et al. (2017) along with the

concepts of knowledge management and customer relationship management should be

researched further in the future. Especially, the implications of customer life cycle

management to customer’s management in general. Also, the differences between

customer relationship management, and customer life cycle management could be

discussed more in academic journals. The customer life cycle management concept is

especially intriguing in relation to the digital platforms and how the customers can be

managed to ensure value creation in the long term.

2.2. User-Centric Design

2.2.1. Understanding User-Centricity in the Design Process

Design is something that affects each of us every day subconsciously and often people

only notice or talk about it if something is either exceptionally good or bad. From a user

centric-design perspective, it is important to understand the users’ needs, capabilities,

and limitations that have an impact on the design process (Norman, 2013). According to

Norman (2013), products need to be designed so that they are intuitive to use, and they

are obvious from the user’s perspective to use. Users must be able to get feedback when

they interact with the product. In a software-based product this can be done by e.g.,

highlighting which actions the user can do, while providing them with immediate feedback.

Designing a software product that tackles all these issues is challenging but it can help to

think about the users’ mental models or schemes about how they are used to interacting

for example with the real world. Users’ feedback must be always taken seriously, and

based on research, improvements can be made often with great results. (ibid.)

Nielsen (1993) emphasises user-centricity’s importance when creating a product. In the

design process, it is essential to think about how to meet users’ needs, preferences, and

expectations effectively when designing the product. Feedback should be integrated into

every single stage of the design process since understanding users’ point of view helps

to identify issues early on (Nielsen, 1993; Norman, 2013). Design decisions should be

empirically driven through methods such as cognitive analysis to reduce the chance of

wasting resources on purely intuitive assumptions (Nielsen, 1993). There should always

be established usability goals and metrics to evaluate the success of the design (Nielsen,

1993; ISO, 2019). Meeting usability goals in the minimum viable product, MVP, becomes

more likely when evaluating the usability metrics thoroughly (ibid.)

In accordance with Nielsen (1993) and Norman (2013), ISO (2019) also advocates for

active user feedback as a resource for designers to make design decisions. Involving the

user in the design process, while refining the software based on the feedback through

testing, prototyping etc. is an important factor to ensure user-centricity and great user

experience, UX (ISO, 2019). In addition to the user involvement, ISO (2019) emphasizes

accessibility and inclusivity in the design elements. Accessibility and inclusivity not only

ensure that the MVP is designed for everyone, but it also helps the designers create a

product that is likely very intuitive to use and self-explanatory. (ibid.; Carroll, 2012)

2.2.2. User-Centric Design and User Experience in the Digital Platform Economy

Figure 5: (Hassenzahl & Tractinsky, 2006)

Hassenzahl and Tractinsky (2006) investigated what is meant by user experience or UX

for short. They found that interactive software designers need to start looking into UX with

a broader view rather than just the usability of the design. From a digital platform’s

perspective, the design must be dynamic, and it needs to have multiple layers to it to

make sure it is able to capture users’ attention. Pragmatic aspects such as usability and

hedonic aspects like enjoyment are all factors that contribute to UX, and designers must

make sure that the design addresses all of them. Many contextual factors e.g., the

environment where the user is in, affects the UX. Hence, from a design’s perspective, a

wide variety of conditions such as the hardware or the cultural dimensions must be

addressed to cater the experience for every individual interaction (Figure 5). In addition

to functionality and efficiency, platforms must be developed so that they are aesthetic and

raise emotions to facilitate UX in its design. (ibid.)

“UX is a consequence of a user’s internal state (predispositions, expectations, needs, motivation,

mood, etc.), the characteristics of the designed system (e.g. complexity, purpose, usability,

functionality, etc.) and the context (or the environment) within which the interaction occurs (e.g.

organisational/social setting, meaningfulness of the activity, voluntariness of use, etc.).”

- Figure 5 (Hassenzahl & Tractinsky, 2006)

Human-Computer Interaction or HCI for short, explores how computers and software’s

interact with people (Carroll, 2012). According to Carroll (2012), HCI highlights the

necessity of user-centred design principles in software development since it drives users

to adopt the software. The design principles are very important for any software,

especially for a new platform, due to the userbase being low and the heavy reliance on

good reviews. HCI principles help developers to create personalized experiences for each

user which is essential for any good UX. HCI promotes accessibility and inclusivity which

is helpful for platforms that are meant to be used and experienced by a wide variety of

people, especially in a Business-to-Consumer context. In addition to typical testing that

is done to ensure the software design is adequate, developers should also analyse how

users are interacting within the app to make identifying possible issues or inefficiencies

in the design possible. Ethical considerations such as privacy and security in the

information technology systems are important for HCI, because it fosters trust. For

platforms, reputation and credibility are important success factors and transparency

between every stakeholder helps to enhance them. (ibid.)

Lallemand et al. (2015) explored in a gross national survey the concept of user experience.

Their aim was to figure out what UX means from the practitioners’ point of view. They

found the concept of UX to be very diverse and complex and it is crucial for the designers

of platform-based services to understand the full extent of UX due to the complex nature

of having multiple stakeholders within one software design (Carroll, 2012; Lallemand et

al., 2015). Lallemand et al. (2015) highlight how user-centric design is essential for the

success of the platform to make the interaction with the software engaging and satisfying.

Practitioners agree the UX to be multidimensional and subjective in nature. Therefore,

understanding what makes users act in the desired way within the platform is paramount.

Feedback, testing, and refining throughout the software’s life cycle are important tools for

developers to utilize to ensure the UX is seamless and intuitive. (Hassenzahl & Tractinsky,

2006; Carroll, 2012; Lallemand et al., 2015)

2.2.3. User-Centric Design Practices in the Digital Platform Economy

Sundararajan (2016) investigates the global digital sharing economy and gives an

overview of the current global platforms that dominate the market. According to

Sundararajan (2016) global platforms’ design must be made so that it understands users’

needs, preferences, and behaviours across many diverse cultural and geographic

contexts. All successful designs should prioritize encouraging users’ interaction and

participation within the digital platforms. User engagement can be encouraged by e.g.,

building a phenomenal UX that fosters community-building features and gives tools for all

stakeholders to share what they think about the platform, and thereby being able to co-

create value. Throughout Sundararajan’s (2016) research, trust, transparency,

accessibility, fairness, and inclusivity was found to be essential for a successful digital

platform to facilitate for the demanding value co-creation. (ibid.)

Like discussed previously, user-centric design practices are paramount for the

functionality of the global digital platform economy (Hassenzahl & Tractinsky, 2006;

Carroll, 2012; Lallemand et al., 2015). Edelman and Luca (2014) looked into a well-

established global platform called Airbnb, which provides a digital venue for individuals to

rent out rooms or properties to guests in exchange of money. They found that social

discrimination within the platform was common. Guests with African American sounding

names were around 16 % less likely to have their booking request accepted by the hosts

when compared to white-sounding names (ibid.). Social discrimination within platforms is

an important finding as it demonstrates in practice how designers of the software must

think of creative ways to ensure good user experience. The UX can be quickly tainted by

bad experiences from minorities, and it takes a toll on the reputation of the software (ISO,

2019). Edelman and Luca (2014) discuss in their paper the potential interventions that

should be made to policymakers or to the platforms themselves to increase transparency,

and accountability in the platforms. For platforms, the main component that carries value

for them are users, and gathering feedback and improving upon them is the only way to

ensure continuous improvement within the life cycle of the design (Hassenzahl &

Tractinsky, 2006; Carroll, 2012; Lallemand et al., 2015).

Luca (2016) discusses several different user-centric practices within the digital platform

economy that enhance the user-experience by building trust. Review systems are often

implemented within the design so that the stakeholders can provide feedback to each

other based on their individual experiences. Reviews often help the users to make

informed decisions, but they also increase the risk of manipulation of the reviews,

selection bias, and promotional content that reduce the trust. Information sharing is a

benefit that digital platforms provide within limits, and sharing often increases the

stakeholders’ confidence to utilize the service. Some digital platforms also provide the

users with transactional flexibility, which means to let the users decide who they want to

engage with. Transactional flexibility contributes to a positive UX and fosters trust. While

positive UX and trust are important, Luca (2016) also highlight the importance of ethical

considerations which influence the trust and reputation mechanisms. Ethics such as

workers’ well-being need to be balanced well with other parts of the business when

designing user-centric features. (ibid.)

2.2.4. Feature Personalization for Scalable Digital Software

Personalization for the masses is defined as the ability to produce customized products

or services at scale (Tseng et al., 2010) and it is very important for global digital platforms

due to the need for scalability. Tseng et al. (2010) emphasize the need for data

management, flexible manufacturing, and adaptive supply chain to accommodate for

different demands by the customers. Listening to the customer and implementing their

feedback into the design is very important for the design to meet users’ expectations and

requirements (ibid.). Global digital platforms must be aware of the most recent

developments in the users’ needs to optimize the users’ interface design for the constantly

changing environment.

“Personalization is envisioned as one of the major drivers for the next transformation of the global

economy. As opposed to customization which emphasizes on design for market segments,

personalization considers each customer as an individual and explores customer’s innate

preference and implicit needs. - - Design is the key to realize mass personalization.”

- (Tseng et al., 2010)

Findlater and McGrenere (2009) discuss in their paper about feature awareness in

personalized interfaces. Personalized interfaces often prioritize performance metrics

such as task completion time and error rates over feature awareness, and they may not

always capture the full UX in the software. Most users need to comprehend how the

interface works to make decisions and effectively utilize all the available features. Factors

that affect feature awareness are e.g., design, user training, and system feedback.

Contextual cues and interactive tutorials are features that help the user to understand the

software. Sometimes eliminating previously unused features may be a better option than

adding new ones in newer versions of the software. (ibid.)

Figure 6: Framework for personalization (Al-Khanjari, 2013)

Al-Khanjari (2013) addresses the need for personalized user experiences for many

software-based applications by proposing a common framework for the personalization.

There are many challenges associated with personalization due to the complexity of

diverse data sources and the interoperability among different systems, especially since

scalable solutions are needed for the efficient operation of digital multifaced platforms.

The framework (Figure 6) provides an approach to personalization that incorporates many

key components of scalable personalization into a software-based application (Findlater

& McGrenere, 2009; Al-Khanjari, 2013). User-centric design and user involvement are all

paramount in the personalization process (Al-Khanjari, 2013).

2.2.5. Managing Feature innovation Within Software Development

Kaushik (2019) explores how digital platforms play a crucial role in managing the modern

economy. Due to the importance of innovation, there’s a growing interest in understanding

how innovation is managed in the software development. Digital platforms need to make

sure that the innovators are able gather and search for information from sources such as

customers, suppliers, competitors etc. Successful digital platforms involve interactions

from other organizations outside the company hosting the platform to create more value

they can alone. In fact, new problem-solving organizations and crowdsourcing platforms

have emerged from the need to facilitate innovation such as GitHub. (ibid.)

Figure 7: Design for User-Centered Innovation methodology (Zaina & Álvaro, 2015)

Zaina and Álvaro (2015) propose that HCI and Entrepreneurship concepts should be

more closely integrated into software development projects by utilizing Design for User-

Centered Innovation methodology or DUCI for short (Figure 7). The DUCI methodology

emphasizes the development of software solutions that address real world problems while

possibly establishing start-ups that can deliver marketable solutions. DUCI’s

effectiveness has been illustrated through case studies that highlight its ability to foster

new software ideas and encourage entrepreneurship. (ibid.)

Figure 8: Design Sprint (Google Ventures, n.d., Arce et al., 2022)

Design Sprint by Google Ventures (n.d.) some principles from the DUCI methodology

(Figure 7) and categorises them into an agile package that is very easy and fast to

implement within a design team. Design Spring (Figure 8) is a method which purpose is

to help development teams design, prototype, and test ideas quickly. In Design Sprint,

there are typically five phases which are meant to be completed within five days (Figure

8). The first phase starts out by understanding the problem and defining what are the

goals of the Sprint. After that, team members diverge, and they start generating wide

range of ideas through brainstorming and sketching. After sketching, teams decide what

is the most promising solution and then prototype and test it. Testing is important as it

provides valuable feedback and insights to the team that can be used to refine the solution

further. Design sprint is known to be very efficient method that encourages collaboration

and creativity that can be innovated and validated quickly. (ibid.)

2.5. Conceptual Framework

Framework 1: User Life Cycle Management in Digital Platform Product Development

In Framework 1, user life cycle management in digital platform product development is

presented in a way that incorporates user-centric design principles as the core elements

that co-create value. Product innovation, feature personalization and testing are tools that

ensure that value is created in a sufficient way. If the testing shows that value is being co-

destructed, the platform will have to start again with the user-centric design principles until

value can be co-created.

User-centric design consists of many things, but simply put, User Experience and Human

Computer Interaction are the key concepts in the literature. Both have many different

characteristics and practices that drive them forward into a better user-centric design.

One of the key elements that global digital platforms must be aware of and must pay close

attention to are trust, functionality, and engagement. By ensuring these factors are

incorporated in the design, digital platforms are able co-create value with its users. By

incorporating feedback mechanisms within the software itself the design can evolve

throughout its life cycle.

Product Innovation refers to Zaina and Álvaro (2015) and Google Ventures (n.d.)

frameworks about how to manage feature innovation. It is essential for global digital

User-Centric

Design

HCI

Product

Innovation

Feature

Personalization

Testing

Value Co-

Creation

Value Co-

Destruction

platforms to innovate efficiently and thereby create a product that is valuable and

convenient for its users. Once the innovation has been done, feature personalization (Al-

Khanjari, 2013) is needed for platforms to cater for the different needs of the multiple

stakeholders of the digital platform. Personalized interfaces that utilize user data can be

made into a scalable solution that keep the users engaged in the platform. Personalized

interfaces also have the benefit of keeping the UX and HCI simple without having

unnecessary features that the users are not aware of (Findlater and McGrenere, 2009;

Tseng et al., 2010). Testing is a key concept in the literature that ensures throughout the

design process that the platform can provide value for someone. Testing is also done

during the digital platform’s life cycle to ensure the product is evolving.

In value co-creation, the stakeholders and customers create value together. High-quality

platform drives the value co-creation as customer are more willing to interact when they

perceive the digital platform to be high-quality. High-quality platform increases the positive

perception of the digital platform which drives trust. Customer having a positive perception

of the platform encourages the customers to choose the platform with good perception

over the others (Alqayed et al., 2022). Moreover, convenient customer service

strengthens the trustworthiness of digital platforms and helps customer to understand

how the platform is used. Customers having positive experience while trusting the

platform embraces value co-creation.

In value co-destruction, the value is destroyed due to flaws in interaction. The

stakeholders within the digital platform should avoid the value co-destruction as it can

lead to losing the value creator or the customer. The value co-destruction happens during

the interactions between the stakeholders, and hence the interactions within the digital

platforms should be thought and designed carefully. The value co-destruction can happen

due to contradictions of values, misuse of resources, and insufficient perceived value

(Lintula et al., 2017). For instance, poor customer service in the digital platform, and

service provider’s misbehaviour can lead to value co-destruction. In turn, educating

service providers, good customer service, positive customer journey, and platform

policies help to prevent value co-destruction (Lintula et al., 2017, Järvi et al., 2018; Sthapit

& Björk, 2019).

3. Methodology

3.1. Analysis Method

The research conducted is qualitative and the focus is on understanding concepts

identified in framework 1 further. Through the qualitative research, we expand on the

identified key concepts within the user life cycle management in digital platform

development. These identified key concepts are e.g., user-centric design, product

innovation, and feature personalization. The qualitative research method helps the

researchers to understand the elements included in the key concepts broadly while

expanding on the reasons behind user-centric design choices that lead to value creation.

Furthermore, less researched topics such as user-centric design in the digital platform

value creation benefit from added descriptive studies, which guide the research further

(Tenny et al, 2022). Also, the qualitative research helps in generating novel research

hypothesis, which can then be used in quantitative studies (ibid.).

The research uses only primary data from interviews due to its ability to generate in-depth

and rich insights which is essential when trying to understand and advance the knowledge

of complex issues (Driscoll, 2011). Primary data from interviews also provides the needed

flexibility for a deeper understanding of key concepts (ibid.) which have not yet been

discussed much in the academic literature.

The qualitative research is narrative, and the semi-structured interviews with one

interview group help to understand how the key stakeholders see value creation and user-

centric design in the global platform economy (Riessman, 2008). In the narrative study,

stakeholders’ perceptions and experiences are studied through multiple interviews (ibid.).

Afterwards, the interviews are compared with each other with the help of qualitative data

coding (Saldaña, 2016). The data coding helps to identify common patterns among the

stakeholders. Once the common patterns are identified, findings are drawn based on

them and then applied within the global platform economy. Furthermore, the potential

conflicts found within the interviewees’ answers give insight on how the management and

feature design of digital platforms should be changed or further improved. Also, future

research topics can be identified.

Figure 9: Gioia Methodology Codes

The data gathered from the interviews will be analysed based on the Gioia methodology

(Gioia et al., 2013; Figure 9). The method starts with coding raw data from the interviews

in the 1st order groups. These 1st order groups are then put into 2nd order which are higher

level themes that reflect similar themes found within the different interviews. Finally, the

data is gathered into the 3rd and final group called aggregate dimensions. These

aggregate dimensions help with the understanding of theoretical constructs. (ibid.)

Aggregate

Dimensions

2nd Order -

Themes

1st Order -

Concepts

Figure 10: Gioia Aggregate Dimensions

Figure 11: Gioia 2nd Order – Themes

User-Centric

Design

Value Creation

User Life

Cycle

Management

Internal

Expertise

Evaluating

Value of Digital

Products

Multiple Levels

of Value

Creation

Customer in

the Key Role in

Creating Value

Societal Value

Key Features

Viewpoints of

the End Users

and Customers

Understanding

that Users

Might be

Different from

Who Pay for

the Product

Realising Who

Uses the

Software the

Most

Product Life

Cycles

Evaluating the

Success

Customer

Profiling

Adjusting the

Design Based

on the User

Feedback and

Perception

Piloting MVP

with Target

Customers

Defining the

Requirements

of the Digital

Product Based

on Customers

Needs

Combining the

Business Case

and Design

Feature

Personalization

User Interface

and Design

Design Process

Reducing

Waste and

Simplifying

Processes

Figure 12: 1st Order – Concepts

Figure 10 shows how aggregate dimensions are divided into three distinct categories and

highlighted with a distinctive colour. In Figure 11, the three dimensions are further coded

into themes which utilize the same colour pattern to be able distinguish which theme

follows the same dimension. Figure 12 gives concrete examples or concepts about what

was said, by who, and how it relates to the previously identified themes.

The research will focus on the analysis of both the business-to-customer and business-

to-business products developed within the digital platform economy to understand the

applicability of the Framework 1. As the digital platforms can have both B2B and B2C

Tarmo: Easy t o use,

clear, intuitive

Anne: Clear and

intuitive UI. Customer

understands platforms

without needing to

contact the

support

Pekka: The

societal value added

would diminish if the

digital platforms would

become nonexistent

Tar mo :

Businesses tend to

derive from customer's

demand rather than from

"abstract" product

innovation

Pekka: involve

customer in product

development by

acquiring feedback

Matti:

Value is created

through efficiency that

platforms provide, but

they are also

replaceable

Tuomas:

analytics from

customer activities

within the product

Matti:

Value proposition

for the consumers

must be clear from

the first click

Pekka:

Rarely the

technological expertise is

the main constraint. Its more

about finding the right

product/market fit

Liisa:

product designer

works together with

technology team to

understand software

constraints

Pekka: user test

groups can be

used

Matti: Research and

R&D is cheaper nowadays

due to the tools that can test

the software's features

before its developed

Tar mo:

User experience

data help to define the

requirements of the digital

product design after

which the design is

further developed

Liisa: Active

feedback from

customers

Tuomas: important

to acknowledge how

much development costs in

relations to benefits: cost/

benefits analysis

Anne:

difficult to find

common ground with

highly technical

developers

Pekka: AI can

personalize services

in the future

sophisticatedly

probably

Tuomas:

interface

responsiveness

important, less text

more photos

Piia:

accessibility

standards for crucial

digital platforms

Tuomas:

the more closely

designers, and

developers communicate

with each other the

better

Pekka:

AI analytics help

in iterating the

existing user

interface

Matti: Users

are often tested in the

piloting phase and based on

their feedback and other

measurements the

software is modified

Pekka: The

usage data used in

profiling the customers

into segments. Further

conclusions drawn from

customer groups

Piia: Learning

from users

activities

Tar mo:

the users differing

from the parties that pay

for the product might bring

some challenges. Digital

platform should consider

both parties

involved

Matti: Even tho

users my think the

platform is free, they are

paying by trading data and

through that some other

stakeholder may pay

for the service

Anne: surveying

Tuomas: listening

to customer

Tar mo :

adjusting the user

hierarchy and

importance based on

which users tend to use

the software the

most

Anne: surveying

Liisa: AI

models can

predict the success

of product

launches

Matti: Customer

feedback, efficiency

metrics, Ratings ( can be

unreliable) Test groups,

targeted feedback

Pekka:

acknowledging how

customer react to the

product launches

and updates

Arno:

Increases

convenience, makes

the feel valued.

Arno:

Developers,

Scrum master, Lead

developer, -

architect

Arno: I don’t

see society working

without digital

platforms

Arno:

Convenience and

data harvesting

creates value for all

stakeholders

Arno: Platforms have

to adjust their business all

the time because they are

easy to make and

competitors get

competitive advantage

quickly

Tar mo: D ig it al

platforms help in

transforming complex

processes into simplistic

user experience with the

help of software

Tuomas:

Simplifying processes,

reducing outcome waste.

Much more efficient

operations, increased quality

with the help of

digitalisation

stakeholders, both experts can help the research to understand digital platforms

functionality. Most of the interviewees have operated in B2C and B2B contexts at some

point in their career.

3.2. Data Collection Method

Interviews are one of the most common ways of conducting qualitative research (DiCicco-

Bloom & Crabtree, 2006). According to DiCicco-Bloom & Crabtree (2006), the in-depth

interviews are good in understanding and discovering complex topics together with the

interviewee. DiCicco-Bloom & Crabtree (2006) describes the discoveries in interviews so

that it allows the “- researchers to co-create meaning with interviewees by reconstructing

perceptions of events and experiences -”. Furthermore, quickly building a positive

relationship with the interviewee at the beginning of the interview is necessary (ibid.).

Establishing a safe and comfortable setting for the interviewee is crucial to enable them

to share personal experiences (ibid.). The importance of making the interviewees feel

comfortable is also identified in Lo Iacono et al. (2016). Especially the first questions

during the interview should be thought carefully and in a way that they are open and non-

threatening to build up a positive relationship already from the beginning (DiCicco-Bloom

& Crabtree, 2006).

The interviews are semi-structured with premade questions so that the interviewees have

a possibility to share additional insights. The semi-structured interviews help to narrow

down the topic of the interviews while keeping discussion open in favour of novel and

differing perspectives. With the semi-structured subjectivist approach, the interviewers

hope to discover new learnings and ways of thinking which can further contribute to

research findings. The focus with the subjectivist interviews is on people’s perceptions

and experiences (Friedman & Wyatt, 1997). Additionally, exploring various topics around

user-centric design and value creation in the digital platform economy, based on the

interviewee’s own expertise, helps to make the interviewee feel more comfortable even

when they are conducted online (Lo Iacono et al., 2016). This way the interviewees might

be more open to share thoughts and it can lead to a more in-depth discussion.

There is one interview group in research: the industry experts. From the industry experts,

the aim is to increase the understanding of value creation, design processes, and how to

manage between the customer and company value creation. The idea behind the

interview group is to see how the experts view stakeholder’s value creation and user-

centric design in digital platforms.

The industry expert interviews are in-depth, and around 1 hour each so that the

researchers have time to build a positive relationship with interviewees and co-discover

the concepts within user-centric design in digital platform economy value creation

(DiCicco-Bloom & Crabtree, 2006). With the lengthier interviews, the researchers hope

that interviewees have time to explore topics in-depth and feel no rush in sharing their

personal experiences.

The industry experts are selected based on their previous involvement in the platform

economy. The experts have all invested resources in the platform economy in the form of

invested capital or work hours. This ensures that the experts have sufficient knowledge

of how B2C platforms function within the global digital platform economy while also

understanding the complexities associated with the development of innovative digital

platforms. The experts have been found by utilizing personal or social media networks

such as LinkedIn. The interviewees have been contacted either via email, direct message,

or by calling.

3.3. Limitations and Ethical Considerations

The research is limited to 8 participants in total, and they have time to talk for a maximum

of 60 minutes. At the time of the research, only the first 8 participants that agreed to the

interview were selected due to the limited time to conduct the interviews (1 month).

Neither age, gender, ethnicity, or any other personal characteristic that is not relevant for

the research has affected the selection process of the industry experts. The industry

experts have been informed about what the research is about and have all agreed on

paper to participate in the study. The experts have been made unidentifiable and the data

collected from them follows strict GDPR rules (General Data Protection Regulation, 2016).

The data, including recording of the interviews and full transcripts, are deleted after the

study has been published and no records of them are available other than what is in this

document.

3.4. Interviewees’ Background

Table 1: Interviewees’ Background Information

Name

Expertise

Years of Relevant

Experience

Business

Type

Tarmo

Venture Capital, Co-Founder,

Sales, Marketing

25 years

B2B

Pekka

Director, IT and Business

Management

25 years

B2C / B2B

Anne

Consultant, IT solutions for

Financial Services, used to be part

of a Tech Start-up

3 years

B2B

Tuomas

Software Developer, Start-ups

20 years

B2C / B2B

Piia

Responsible of Software

Development and Clients

22 years

B2C

The interviewees’ names have been changed so that they remain anonymous. All of them

are considered experts in their field and only factors included in the Table 1 were

considered when selecting them. The experts have professional experience either on B2B

and B2C contexts, but sometimes they have enough relevant experience on both that

they can give example on both. The experts have 3 to 25 years of relevant experience

from working with the digital platform economy.

3.5. Interview Guide

The interview questions on the interview guide will be mainly open and neutral while the

interviewee will be given a chance to elaborate freely and choose to elaborate based on

their own experience. Also, the questions can be adjusted during the interview based the

interviewee’s experience. The value creation and user-centric design will be the main

topics in the interview unless otherwise decided based on the interview setting and

interviewee. The interview guide can be found in Appendix 1.

4. Findings

Liisa

Consultant, Founder

15 years

B2B

Matti

Responsible of IT systems through

sales and systems’ architect

6 years

B2C / B2B

Arno

Responsible of Software

Development, IT and Consultancy

3 years

B2C / B2B

4.1. Findings from Industry Professionals

The findings elaborate around the 2nd order themes identified during the data coding.

The themes describe the aggregate dimensions from different perspectives and highlight

the important considerations according to industry professionals within the dimensions.

The research help to add depth into the existing literature discussion on value creation,

user-centric design and user life cycle management. The viewpoints of the experts

illustrate the current thinking among professionals operating in the field of digital platforms.

4.1.1. Value Creation

Industry experts see that use of digital platforms should be easy and convenient. Building

on the user friendly platforms some key features were found which digital platforms

should consider. According to Anne, the platforms should have clear and intuitive user

interfaces to enhance the accessibility of the platform. Anne states that “They should have

clear and intuitive UI so that customer understands where to go without need to contact

the platform.” Anne sees as a good metric for user friendliness is users' capability to

navigate within the platform and understands it without contacting to customer support.

Piia agrees with Anne that platforms should have easy to use and intuitive interfaces for

users. The intuitive user interface constructs a basis for value creation as otherwise users

may choose another platform if the interface is too challenging. Additionally, Anne sees

as key features that the user should have possibility give feedback easily and pricing is

showed transparently in transactional platforms. The possibility to give feedback helps to

address issues of the platform that users face, and overtime support the platform

development. In turn, the transparent pricing can build trust among customers. The user's

possibility to give feedback and transparent pricing on the user interface both support the

value creation by making users feel important and valuable. The platform focusing on

user experience drives value creation.

The societal value is emphasized by many of the interviewees. Digital platforms make

people’s live easier in many ways. For instance, Arno sees that nowadays the digital

platforms are a necessity for society in its current form. Further, Matti sees that the usage

of the platforms will likely increase in the future. Another point key point highlighted in

value creation for society is the stakeholder perspective. Liisa brings up that digital

platforms increase the value creation for stakeholders and enable new forms of value

creation. Also, Liisa reminds that the digital platforms are made for the users and the

motives of the users within the digital platforms should be considered thoroughly. Liisa

notes that the key in successful platform development is to understand the motives of the

users. Liisa states that "We continuously do research about our target customers to

understand what kind of challenges they face" (own translation). Piia builds on the

stakeholder perspective by highlighting that digital platform combine different

stakeholders and enhance communication between the stakeholders. The value creation

of the digital platforms has a great societal impact and one should think of the value

creation from the perspective stakeholders it serves.

The customer is in the key role in value creation. Tarmo states "-...rarely I have seen that

someone innovates a product from an empty table rather usually the customers tell what

is needed after which the company responds” (own translation). Tarmo discusses that

businesses tend to derive from the customer’s demand rather than abstract product

innovation. During the involvement of various digital platform projects Tarmo sees that

businesses should try to figure out the customer need to build successful platforms.

Although Tarmo notes that occasionally abstract innovations happen where the need of

the customer is rather obscure and the driver for the product development comes from

the business owner. Pekka advices that digital platforms should involve customers

already in the product development by acquiring user feedback. Anne agrees with Pekka

on the importance of customer involvement and adds that the feedback should be

collected consistently alongside the development of the platform. Liisa agrees with Anne

and Pekka on the early customer involvement. Additionally, Arno discusses on the

platform usage data created by the customer, which can be monetized. So, Arno sees

the customer platform activity data as a resource of the digital platform. Aligning with

customers interests, understanding the customers, and leveraging the user data drives

the value creation further.

Digital platforms have multiple levels of value creation of which the platforms developers

should consider. Tarmo notes that the value creation depends on the who’s perspective

is viewed. Many times, to understand the value creation thoroughly in digital platforms

one has to acknowledge the value creation process from the point of multiple

stakeholders according to Tarmo. In turn, Anne highlights that digital platform benefit

stakeholders in multiple ways, which resonates well within the Tarmo’s philosophy of

different levels of value creation. Pekka sees that customer tend to be the revenue drivers

for digital platforms, whereas Liisa sees identifying pain points of the customer as

prerequisite for value creation. Matti states that value is created for the stakeholders

through efficiency of the platforms. The experts have many different viewpoints of what

value creation is. The key themes raised when explaining value creation were value for

multiple stakeholders, value of the user data, and identifying the pain points of the

customers. Analysing value creation requires to understand the different stakeholders,

and their needs in addition to the digital platform characteristics that they use.

The experts give multiple different ways of evaluating the value of the digital products.

Pekka states that satisfying the user’s need is required to create value. The platform could

for instance measure the user satisfaction by asking for feedback which is mentioned as

a key feature for a digital platform. Further, Pekka continues that platforms should

consider the value of the platforms based on the usefulness and use cases of the platform.

For instance, the platform could see based on the feedback if users are able to complete

the task they wanted to with the platform. Before developing the digital platform service,

the platform has to consider does the service add value to prevent from wasting resources

according to Pekka. The value considerations can be conducted for instance with product

piloting according to Pekka. Further, Pekka states "-...we want digital platforms to involve

the customers and their stakeholders in the service design process as it is part of the

product validation and helps to understand both business needs and user needs” (own

translation). Pekka has noticed that many times businesses want to develop certain digital

products based on the industry trends rather than actual need for such product. Tuomas

builds up on Pekka’s comments by stating that one should think in what way the user

benefits from the platform. Also, Tarmo agrees with Tuomas by noting that perspective of

user helps to understand how value is created. The value creation should be evaluated

from the perspective of users before even developing the product, and collecting user

feedback is useful tool to measure to value creation for users.

Internal expertise of the organization creating the platform is seen as a necessity by most

of the experts interviewed. According to Tarmo having people with strong technical

background is important when building digital platforms. Pekka agrees with Tarmo,

although Pekka notes that rarely nowadays the constraint of the digital platforms is the

technological expertise. Rather, the constraint nowadays for digital platforms is finding

the right product /market fit according to Pekka. Pekka adds “Rarely the technology is the

constraint in these days as you can build variety of technological solutions but first you

should think about whether it is worth building” (own translation). Anne finds problematic

the communication between business experts and technology experts and sees that main

challenge in digital platforms development is communication between the business, and

technological experts. Tuomas highlights that talented team supports the value creation,

and constantly modifying the software is costly for the organization. Also, Piia sees the

technology developed helps value creation. Having the right internal expertise support

the value creation and should be considered when analysing the value creation.

Digital platforms are also reducing waste and simplifying processes. Tarmo elaborates

that platforms help to transform complex processes with multiple steps into simple actions

guided by the digital platform. Pekka and Tuomas build up on complex processes and

agrees that digital platforms make processes easier for users. Tuomas states “Many

times the customers have some kind of issue and the process which can either save

money or speed up the task by our digital solution tends to be demanded” (own

translation). In addition, Liisa adds that platforms help in making processes more efficient

and higher quality with less outcome waste.

Overall, the value creation is seen as crucial by the industry experts. The user

involvement is needed already during the planning phase of the digital platforms. The

better the organization can understand the users’ needs, pain points and key motives, the

better platform can be developed. The effective data collection can leverage the value

creation and increase value for all stakeholders within the digital platform. The value

creation can be also seen in reduced process waste and more efficient operations.

4.1.2. User Life Cycle Management

Use life cycle management is about acknowledging users' needs and aligning activities

to meet the changing needs of users. Pekka highlights those large digital platforms with

lots of resources tend to know thoroughly what customers buy, when and how. The data

collected from user activities is used in customer profiling to identify different types of user

groups. Further, the customer groups then can be targeted with personalized

advertisement for instance according to Pekka. Pekka also identifies that AI can be used

to profile customer more profoundly. Piia sees that learning from activities of the users is

key in customer profiling and Pekka suggests that AI can help with that. Piia also suggests

that more cross sales could be conducted based on the customer profiling to realize the

value of customer profiling further. Piia states "All the data was used only to collect Plussa

points. Only for the collection of Plussa points instead of thinking what kind of additional

value can you offer for the customer that likes organic products. The customer could be

offered everything that relates to the lifestyle of consuming organic products in the loyalty

program” (own translation). Piia gives example that if company sees that certain customer

group tend to benefit for additional product, then the product should be marketed to the

customer group actively.

In some cases, understanding that the users might be different from who pay for the

product can help in user life cycle management. Tarmo notes that there might be

miscommunication between the party that buys the digital product and the actual user. In

such cases Tarmo suggests that the organization managing the digital platform takes

care of both parties involved and actively engages with both stakeholders to ensure

sufficient understanding about the users' needs. Matti brings up another viewpoint

referring to the platforms where users trade their activity data for access to use the digital

platform. In such situations also both stakeholders' interests should be accounted for as

Tarmo suggests. Further, Matti states “There are business models where the customer

interface is a tool for the real business and there are two distinct stakeholder groups. For

both stakeholders’ groups that value should be created. The complexity of the business

model tends to increase where there are two distinct stakeholder groups interconnected”

(own translation).

Acknowledging the viewpoints of end users and customers is highly important to maintain

users and understand the current key issues with the digital platform. Liisa discusses that

getting in-depth into customer’s thinking and motives is important, although challenging

task digital platforms try to overcome. According to Liisa finding the root cause is common

issue with the digital products so in other words understanding the customers real motives

to use the digital platform. Pekka, Anne, and Tuomas suggest close involvement with

customer by collecting feedback for instance by surveying. Further, Tuomas states

“Platforms tend to have some kind of customer support where customer can go, seek for

help and notify if something is not working properly” (own translation). Understanding

what customers think about the digital platform in general helps to manage the existing

userbase and acquire new customers.

Understanding whom use the digital platform the most has an impact on user life cycle

management. Tarmo suggest adjusting user hierarchy and importance based on which

users tend to use the platform the most. Realising the user groups that use the platform

most helps in aligning user life cycle management towards the user groups who use the

platform the most according to Tarmo. Also, Tarmo notes that the key functionalities of

the platform might change overtime once the key users who uses the platform the most

are identified. Further, Anne states that surveying can be used as a tool to understand

who uses the platform the most. The functionalities of the digital platform should account

for how the digital platform is used. Organizations should acknowledge in user life cycle

management that some stakeholders might use the platform a lot less than other,

although all the involved users benefit from the existence of the digital platform. The know-

how of the users gathered during user life cycle management can be utilized in digital

platform development.

Product life cycles are important in the user life cycle management. Product life cycle link

the product development into user life cycle management. According to Arno platforms

have to adjust their products within digital platforms continuously to keep the users

satisfied. Arno notes that digital platforms can be quite easily build nowadays, which

makes the competition between the digital platforms fierce. Further Arno states “One of

the benefits of digital platforms is being able to adapt quickly and easily." Matti adds on

product life cycles that platforms want to users to use the existing service as long as

possible and even try to extend the customer engagement with their existing digital

platform products. Liisa sees that product life cycles depend on the viability of the

technological solutions. In turn, Pekka elaborates that product life cycles starts with

planning the product and that product life cycles should be considered in the user life

cycle management. Tarmo has experienced that product life cycles are difficult to predict.

According to Tarmo, organizations should be open to extend the lifetimes of the existing

products and be aware that customer may still demand the existing digital products,

although more sophisticated technological solutions might be available in the market.

Evaluating the success of the user life cycle management can be measured for instance

by acquiring feedback from the existing users according to Anne, Matti and Arno. Arno

states "Platforms can acquire feedback fairly easy with for example feedback buttons in

the bottom right where customers can put in their feedback or through chat bots where

customers can engage with the platform directly.” Liisa sees that clear indicators to

measure the user life cycle management improves the team’s probability to succeed in it.

Important part of the success evaluation can be acknowledgement of how users react to

the product launches and updates according to Pekka. In turn, Piia questions the viability

of the user life cycle management in digital platforms. Piia states that the user loyalty in

digital platforms is questionable as users have low barrier to change the digital platform.

Also, Piia sees that due to the flexible nature of digital platforms keeping the users the

use the same digital platform for a long time is challenging.

Overall, the user life cycle management helps the digital platform to offer great service to

its users. With the proper user life cycle management practices such as collecting user

feedback, profiling customers, involving stakeholders, realising the main user groups, and

acknowledging product life cycles digital platforms can strengthen their product

development capabilities. Also, with the extensive know-how on users, the platforms can

offer good customer service, and stay up to date on the quality of their platform.

4.1.3. User-Centric Design

According to the interviews, user-centric design is an important factor that software

developers must consider. One thing that user-centric practices usually start with, is

piloting the minimum viable product with the intended target customers. According to

Tarmo, understanding customers better and validating the product must be done to

ensure a good platform. Pekka suggests that prototyping and user test groups can be

used as well to ensure a well-functioning platform. Anne said that testing for bugs within

the software after collecting feedback from the customers helps to make sure the product

is ready to move to the next phase along the development cycle. Matti pointed out that

“research and development is cheaper nowadays due to the tools that can test the

software’s features before they are developed” (own translation). According to Arno new

updates and features are implemented after slight adjustments are done and the tests

show that the feature is working. If the test shows that the new idea is not working, it is

usually pulled back from the production. Arno also mentioned how it is possible to test

and build new ideas in a sandbox environment that lets the platform test features that do

not harm the business.

Defining requirements of the digital platform based on customer needs can be a hard task

to figure out. According to Tarmo, “user experience data helps to define the requirements

of the digital platform design after which the design is further developed” (own translation).

Anne and Liisa suggested that actively surveying the customers and involving the end

user in the development process helps the platform to define the correct design. Matti

said that the business case must be defined before the development, but sometimes

software is designed based on what technology the digital platform operator might think

they need rather than what is actually needed for the business. This can be for example

a company who wants to adopt AI in their business just because it is trendy and other

companies are doing as well.

Combining the business case and design can be a hard thing to do. According to Tarmo,

understanding what kind of situations users use the digital product, or the context, gives

guidance for suitable user-centric design for developers. Pekka highlighted the

importance of being able to combine business case with the design so that there is a need

for the digital platform. According to Anne, “it can be hard to find a common ground with

highly technical developers”, thereby making the business and software design difficult to

match. Tuomas and Liisa saw it important to evaluate the development costs to the

potential benefits and ultimately judging a successful digital platform based on the

revenue it generates.

Feature personalization according to Tarmo can be done by having different designs for

different user groups with different motives for use. Digital platforms must be careful with

excessive personalization as it may lead to the lack of platform scalability. According to

Pekka, A/B testing can be done to personalize features, but it is more commonly done to

test the user interface. Pekka and Piia saw AI as a possible tool that can sophisticatedly

personalize services in the future. Currently feature personalization is expensive and

therefore less used. Tuomas said that feature personalization depends on the use cases.

For example, a running application can have Finnish flag colours for runners from Finland

and it can have Finnish as its language of instruction. Piia said that feature personalization

is possible for user groups by having an easy-to-use version for people with disabilities.

Liisa said that less personalisation means more scalability which is why softwares must

be designed with minimal personalizations. Matti said that personalization is not often

done to developer tools, because they are very standardised, but sometimes

personalisation is done for specific needs. Personalization is often hard, but in a

consumer context the user experience is often personalized by e.g., the content that is

shown. Matti thinks that personalization is important for digital platforms and profiles are

common way to personalize the experience. According to Matti, Personalisation is

problematic when taken too far due to issues such as equality, but he doesn’t see it being

a big problem right now. Arno’s opinion about feature personalization is that it “increases

convenience and makes the users feel valued.” This is especially true for customised

content, but personalized interfaces do not necessarily make much difference.

Intuitive user interface and design is important and easily testable according to Tarmo,

Pekka and Anne. In Pekka’s opinion, nowadays user interfaces are quite standardized,

and they should be easy to use. Pekka thinks that AI will drive the user-centric design in

the future. According to Tuomas, good used interface and design takes into the

consideration how practical the software is, how long it takes to navigate, how much

outside help is needed, and was the user able to finish what they intended to. The

interface needs to be responsive and have more photos rather than text. According to

Tuomas, mobile applications are typically developed first, and they include a lot of

animations. Names of the applications are also typically branded into sci-fi themes with

no apparent meaning. Tuomas, Piia and Arno also mentioned that typically softwares

need to be developed according to common accessibility standards. Piia also mentioned

how societies, especially with aging population, should take care of the accessibility of

the digital platforms. Liisa also thinks that user interface and design is important, and it

includes things like how the buttons and features look like. However, budget constraints

are tricky, and design is something that often might lack prioritisation. Matti thinks that the

design should catch attention and it must bring value with minimal clicks. User interfaces

and experiences should be branded, and the user-centric design must be incorporated

well enough so that the software does not need an instruction manual. Arno also things

that in addition to the accessibility of the design, interfaces must be good looking and

easily understood by the users.

Design process according to Tarmo should be fairly simple with the product owner having

an important role. In Tarmo’s opinion, sometimes the testing of the software is in more

important role than the design and design can be considered during the long software

development process. Basically, the design tends to be the least challenging aspect of

the software development process. Pekka thinks that objectives and key results help in

the design process by defining what the developers are aiming for. There are many

frameworks that can be used, and design sprint can be a good framework as well

according to Pekka. Nowadays rarely anyone comes up with a completely new framework.

Anne thinks that the most difficult part of the design process is communication between

the developers and the businesspeople. However, according to Anne, project manager,

business architect and developers are the ones typically in charge of the design. Tuomas

thinks that “the more closely the designers communicate with developers the better” (own

translation). Design ideas can come from anywhere, even from the users themselves.

Liisa highlights the importance of involving the customer in the design process. Liisa for

example might ask her customers to rank their best ideas for future development and

then test the prototype before developing the software. Prototyping and quality control

are great ways to minimize risks and excessive work according to Liisa. In Matti’s opinion

both internal and external stakeholders must be involved in the design process.

Companies typically have someone who specializes in designing user experiences and

interfaces with the business owner. However, sometimes designs are too expensive, and

the owners must make sure that the platform is economical. According to Matti and Arno

there is no one correct framework that is used, but typically the design process is done in

an agile manner.

Adjusting the design based on the user feedback and perception is commonly done in the

digital platform industry. According to Tarmo, digital platforms are improved by actively

seeking feedback from the customers and involving users’ opinions early on is important.

According to Pekka, digital platforms are able to predict the user interaction accurately

with the help of AI and AI analytics can help the design of the existing user interface. This

is why the effective use of data is very important. Anne thinks that gradually developing

the design based on the feedback ensures that the software development goes hand in

hand with the users needs. Tuomas also finds it important to involve feedback in the

development and Piia says that the feedback helps the developers to understand what to

do next. According to Matti, “users are often tested in the piloting phase and based on

their feedback and other measurements the software is then modified” (own translation).

4.2. Revised Conceptual Framework

Framework 2: Revised Conceptual Framework

Based on the interview findings, the initial Framework 1 has been revised to Framework

2 so that it reflects additional findings that relate to user life cycle management in digital

platform development. The framework now includes a new ending dimension called

Discontinue Product which has been found after interviewing the experts. Other than that,

the ending dimensions remain same, but they have been reordered into the form of traffic

lights to better visualize the concept of user life cycle in digital platforms.

In addition to the modifications made to the ending of the framework, two new dimensions

have been added to each step that leads to the ending. The new dimensions added to

the framework are ordered so that the top reflects factors that are typically influenced by

outside stakeholders from the digital platform. The platform must look from the outside

perspective when gathering information about the top dimensions. The new bottom

dimensions added reflect the platform itself and is more focused on the efficiency and

effective management of the platform. All in all, these new dimensions have been found

based on the expert interviews and add insights to how platforms should think about user

life cycle management.

User-Centric

Design

HCI

Product

Innovation

Feature

Personalization

Testing

Value Co-

Creation

Value Co-

Destruction

Discontinue

Product

Quantitative

Indicators

Qualitative

Indicators

User Group

User Data

Internal

Stakeholders

External

Stakeholders

Product Innovation is influenced by both internal and External Stakeholders. External

Stakeholders can mean things such as customer feedback or ideas that come from

surveying the customer. Internal Stakeholders mean e.g., stakeholders within the

company such as the developers, product owners, user interface / experience designers

etc. who innovate the digital platform from the perspective of the company operating the

digital platform.

Feature Personalization is done by utilising user groups and user data. User groups can

be defined in the platform by e.g., having profiles that show different content / interface

based the user’s role. User data can be utilized by the company operating the platform to

better customize the interface and content shown to the individual users or user groups.

Artificial Intelligence can make the user data especially valuable as some AI models can

help to predict accurate what the users want from the platform.

Testing can be done by examining both Qualitative and Quantitative Indicators. Qualitive

Indicators provide data that can better explain why and how the platform creates value.

Common ways to gather qualitative data that test the platform is by e.g., interviewing

customers or having a feature that allows written feedback. Quantitative Indicators are

found within the user data. For example, a platform can look at the platform usage data

and figure out whether the design has bottle necks or something else that prevents users

to do what they were intending to do. Platforms can also implement features such as short

reviews or surveys that the users can easily respond to gather more data on how to

improve value co-creation in the platform.

5. Discussion

5.1. Similarities Found from Literature Review and Expert Interviews

Similar concepts and viewpoints were found both in literature review and from interviews.

In general, the academic experts tend to use more comprehensive terminology, whereas

the industry experts preferred to describe the phenomena with their personal style.

Despite the language use differences, many similarities were found between the

academics and industry experts' viewpoints and ways of describing digital platforms key

concepts.

The concepts of value co-creation presented by Grönroos & Voima (2013) and value co-

destruction discussed by Lintula et al. (2017) were present in industry experts viewpoints

how value is created together with stakeholders. Although the industry experts lacked the

specific use of terminology value co-creation and value co-destruction, many of the

experts clearly understood the value creation process within the digital platforms similarly

as presented by Grönroos & Voima (2013) and Lintula et al. (2017). For instance, Liisa

identified that digital platforms increase value creation for stakeholders while Tarmo noted

that there are multiple stakeholders involved in the value creation process. Further, Tarmo

added one should consider how the value is created differently for each of the

stakeholders, which is touches on the Figure 1: Value Creation Spheres framework

presented by Grönroos & Voima (2013).

Digital platfoms help with the communication between the stakeholders according to Piia.

The communication is highlighted also in literature multiple times. For instance, Grönroos

& Voima (2013) identifies that the value creation in digital platforms happens during the

interaction between the stakeholders. Also, Sthapit & Björk (2019) identifies that sufficient

interaction has an important role in the service experience. In turn, the good service

experience helps to prevent value co-destruction (Sthapit & Björk, 2019).

Regarding the user life cycle management, the cross sales is identified by both the Lee

et al. (2017) and Piia. Also, Piia builds up the Figure 4: Customer Life Cycle Management

framework by giving a concrete example of cross sales (ibid.). According to Piia

companies should market additional products or services that fit together with the already

purchased product or service. Still nowadays Piia sees that companies lack proper cross

sales practices.

The value of platform data usage is identified by both Bhargava et al. (2020) and Arno.

Bhargava et al. (2020) states that strategic data collection increases the value creation in

digital platform while Arno identifies the value of platform usage data monetization

possibility and sees the platform data as a valuable resource. So, the value of the platform

is emphasized both in the literature review as well by the industry expert.

Like Nielsen (1993), Norman (2013) and ISO (2019), many of the interviewees such as

Pekka and Tarmo emphasized the importance of gathering feedback and testing the

product to make sure that the design is sufficient to co-create value. Anne and Arno also

indicated quantitative testing in addition to qualitative feedback to be important tool that

determines successful design. Anne and Liisa also highlighted the how important it is to

actively seek feedback from customers and then work out whether the design is working

or not.

Feature Personalization is a hard task to do due to the complexities among different data

sources, especially since scalable solutions are needed for digital platform (Findlater &

McGrenere, 2009; Al-Khanjari, 2013). However, like Pekka and Piia pointed out, AI has

the potential to make future personalization possible by utilizing diverse user data and

through that create personalized interfaces. Matti and Arno think that Feature

Personalization is more likely to happen within profiles and is more related to customized

content that is shown within the platforms.

In the interview, Tuomas, Piia, and Arno pointed out how the designs typically are

designed with the help of accessibility standards. Piia also mentions how nowadays

societies that have aging population, must pay closer attention to different accessible

designs. One common accessibility standard that is used according to the literature is

ISO (2019).

There are many different ways to manage the design process. Pekka mentions Objectives

and Key Results framework to be very useful in addition to other frameworks such as

Design Sprint (Google Ventures, n.d.). According to Matti and Arno, there’s no one

framework that is typically used by companies but must of them function in an agile way.

Anne and Liisa think that the design choices typically come from within the company and

the internal stakeholders have a big responsibility to design the product. However, both

Anne and Liisa involve the external stakeholders in the design process such as customers

to make sure no excess work has to be done by working on wrong designs. All in all, the

interviews seem to suggest that the companies are utilizing very similar frameworks for

managing software development that was identified in the literature such as DUCI (Figure

7; Zaina & Álvaro, 2015) whether they know it or not.

5.2. Managerial Implications

The understanding of the key concepts of value creation, user life cycle management and

user-centric design help to acknowledge the opportunities, challenges, and constraints

that digital platforms have. For instance, stakeholder perspective in value creation can

help to identify the key features required for the platform and the kind of policies the digital

platform needs based on the variety of the stakeholders. Managers should view the

theoretically concepts as directing rather than as an absolute truth and apply the concepts

according to the context they operate in. The academic suggestions should be reflected

together with the practical results from operating the digital platforms to understand better

the suitability of the concepts, and findings.

Managers should pay attention to the value co-creation and value co-destruction in the

digital platform product development. In the Framework 2, the traffic light model is

presented where the value co-creation and value co-destruction are identified together

with the option to discontinue the product. While developing the digital products, the

managers should be aware of how much the products create additional value for the

platform. If the developed product fails to create enough value, managers should consider

whether the product is further developed or discontinued. Managers can use the

Framework 2 as a tool to navigate through the digital platform product development and

evaluate the viability of the products. For instance, if the product fails to create value, the

manager can decide to review the Product Innovation phase to collect additional feedback

from External Stakeholders to understand the user needs better.

5.3. Applicability to International Business

Digital platforms can be scaled into international markets quite easily from the point of

software. However, the challenge is to understand of the cultural context and

acknowledge the existing competitors. Also, finding suitable human resources to develop

the international expansion can be challenging. The key concepts in value creation, user

life cycle management, and user-centric design can be applied to international context

with caution. The concepts of value co-creation, value-co-destruction, HCI, and UX are

considered in the conceptual Frameworks 1 and 2. Also, the insights from the user life

cycle management concepts such as customer retention, and new product development

are considered in the frameworks. The frameworks illustrate the way digital platforms

product should be developed according to the literature review and industry experts

interviewed. In the international context one should be aware of prevailing culture in

product innovation, feature personalization and testing presented in Frameworks 1 and 2.

For instance, in the Framework 2 the qualitative indicators in the testing phase that

organizations should consider may differ from market to market. Further, the type of User

Groups in Feature Personalization and External Stakeholders in Product Innovation vary

from market to market. Although the Frameworks 1 and 2 might suit well in internationally,

one should consider thoroughly on how to apply the concepts appropriately into the given

market. The value creation, user life cycle management, and user-centric design are all

important parts in managing and developing digital platforms. Recognizing the prevailing

market while applying the Frameworks 1 and 2 helps to operate digital platforms

internationally.

5.4. Suggestions for Future Research

The implications of artificial intelligence, AI, in digital platforms could be researched more

in the future. The AI is currently highly topical and developing rapidly, which offers room

for research. Many of the industry experts interviewed talked about AI, so the use of AI is

increasingly a part of managing and developing digital platforms. Especially, the use of

AI in digital platform feature personalization was seen as beneficial. The AI brings

additional layer in value creation, user life cycle management and user-centric design. AI

can change the value creation mechanics in digital platforms and disrupt the development

of platforms. Further, the AI can change the role of digital platform operator as the

processes become more and more automated.

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Appendix

Appendix 1: Interview Guide

Questions About the Interviewee

1. What is your professional background?

2. How long have you been involved with digital platforms and how?

Questions About Global Platform Economy

1. How do you see digital platform’s role in the modern society?

Questions About Value Creation in General

1. How do digital platforms benefit its stakeholders from your perspective?

2. How is the value for stakeholders considered when developing the digital platform?

3. What kind of features are important for digital platforms when creating value for its

stakeholders?

4. Do you think digital platforms add value for its customers long term? How should

the digital platforms think about the value added for customers throughout its life

cycle?

5. How does the company operating the platform evaluate the pros and cons of their

platform? For example: What methods, tools are used for that? When and how is

it monitored?

Question About User-centric Design and Managing Software Development

1. Do you measure or track customers’ feedback about using the digital platform? If

so, how big impact does the customer feedback have on digital platform

development and its operations? How is this feedback managed, considered,

implemented?

2. How do you see the role of the software design in successful digital platforms?

3. Who usually takes part in the design process?

4. How do you measure the success of the design? Are there for example some

concrete indicators, testings or experiments that measure it.

5. What do you think is the prevailing software development philosophy for digital

platforms? E.g., do you develop digital platforms based on functionality, user-

centric design, or something else and why so?

6. How do you implement new ideas or concepts in the design and where do they

usually come from? Can you explain how you start the implementation phase and

how do you track the success of it?

7. Do you use any frameworks e.g., Google Design Sprint, DUCI, or scrum to help

with the phases along the software development cycle? How does the design

evolve over time?

8. Do you see feature personalization for each user or user group as an important

factor that makes some digital platforms successful?

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