The hallmark of a failed initiative comes when the massive benefits, the huge changes and the wonderful new products promised begin to boil down to a vague statement that “process was improved” and “we all learned valuable lessons.”
Automotive eCommerce and eBusiness aren’t quite there – yet. But already, the process and lesson voices seem to be tuning up, and automotive suppliers are understandably tensing their jaw muscles just in case they’re about to take one on the chin again.
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If the suppliers don’t hear something firm from the OEMs soon about exactly what a massive eBusiness exchange will require and deliver, their tension will grow to tooth-cracking intensity.
They’ve already seen expensive and haphazard process “advances” come down the pike as requirements of doing business with OEM customers.
Take computer-aided design and manufacturing. The system was to ease design, get rid of multiple iterations of drawings, speed data flow and reduce errors. It did, but at an enormous cost.
Maintain a separate CAD/CAM workforce, separate hardware, separate site licenses, training programs and staff for each of the Big Three? Would any sane supplier intentionally choose that expensive, cumbersome process for themselves?
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By GlobalDataEDI; QS 9000; ANX; the initiatives arrive as exciting, top-down announcements of opportunity, and they gradually fade as expensive costs of doing business. Something in the tone of the industry right now says that suppliers are feeling lost and dubious about eBusiness. They don’t know where the “verticals” and their authority start and stop. They don’t know whether it’s a hardware or software investment. (They think it’s one or the other). They focus on the fear of what an online auction could do to their margins, and when they ask where their advantages are, it’s hard to prove any gain.
Estimates for overall industry improvements associated with eBusiness seem to keep going up and up, with research surveys appearing to feed off one another in the race to produce a yet-more-improbable figure late in this decade. Yet, at the same time, suppliers are told by enthusiasts that predictions beyond a year, two years, are worthless in the e-age.
The suppliers know all too well that the industry hasn’t been through a complete purchasing cycle for new vehicle development using eCommerce so far.
Nobody has even been through a fully-implemented, reportable fiscal year of automotive supply chain eCommerce.
They also hear statements like this, from the chairman of a new automotive dot-com: “The race to space and where is the opportunity is very, very important. You may not be able to implement, execute and continue on with consensus management. Consensus management says the opportunity and decision-making falls to the lowest common denominator. Who’s the dumbest wino in the room? Let ’em go. I’m going to create this new business entity I’m launching outside the traditional structure of the business.”
Suppliers look at this, and listen to those statements, and they do not see a wise community implementing change. They see a pool full of self-devouring sharks. Is it any wonder they stand at the side and wait, rather than dive in?
If Covisint and its ilk want suppliers to do more than fear them, the exchanges need to start delivering real working information at a simple, basic level about what will be imposed on suppliers — not a concept sales pitch or a network diagram showing clouds labeled “best practice” or “best of breed.”
And for all of our sanity, don’t try to pretend that a cost push down the supply chain, if it comes, improves anybody’s day at the bottom.
For more articles from this month’s ecommerce Automotive Newsletter click here.
