The automotive industry is in the midst of unprecedented change driven by a trifecta of emerging technology, rapidly evolving consumption preferences and dramatically shifting business landscapes. All three drivers combine to further complicate the already complex and high-volume vehicle supply chain – and the supplier sub-chains that feed into it. The need for flexibility, agility and resilience in the supply chain has never been greater.
So how are automotive leaders overcoming these challenges? They are leveraging the right technology at the right time, focusing on three key areas: scalability, intelligence and concurrency.
Emerging technology is advancing the need for scalability
At the moment, the fast-paced release of new technologies is pulling the industry in multiple directions at once. Emerging automotive technology is fueling, and is fueled by, the focus on the autonomous vehicle – both passenger cars and heavy trucks. Propulsion technology advances, combined with the need to be environmentally responsible, is pushing the industry towards alternative fuel sources, including the electric vehicle. Shared mobility could well create a back-to-the-future scenario, with ride sharing and even subscription beginning to outpace outright ownership. And, in a connected world, it’s not surprising to find a huge focus on the connected car.
Automotive leaders are turning to sophisticated solutions that can evolve alongside their business as it expands and connects with new sectors, from technology to energy to service.
Rapidly changing consumption preferences require better data management and intelligence
Consumer preferences continue to shape how the automotive industry innovates, and the supply chain is also becoming a critical determinant of overall customer experience. What this means varies wildly from organization to organization. For many original equipment manufacturers, ensuring that the finished vehicle can be on the lot when a customer arrives to make a purchase can be the critical decision from choosing one make over another. For others, more lies in the quality of elements coming from various suppliers. Regardless, automotive organizations need to have a deep understanding of their customer and how the supply chain fits into meeting those expectations.
That makes intelligence paramount in today’s market. There are more data sources than ever, but there is often confusion about how to best utilize them. There’s complexity in feeding them into a centralized system. Smart automotive leaders are utilizing a platform approach to managing data sources combined with the latest technologies, like machine learning and artificial intelligence, to better enhance their team’s knowledge and know-how.
Dramatically changing business landscapes give new urgency to concurrency
The regulatory and business landscape within which the automotive industry operates is changing dramatically too, with constant changes to trade agreements and tariffs. These changes are often accompanied by political volatility and have significant impact on the manufacturing facilities, suppliers and overall operations for an automotive company. Added to this is the volatility driven by natural weather events, which can impact multiple parts of the supply chain.
Silos – functional, geographic or otherwise – can seriously harm an organization’s ability to understand its end-to-end supply chain and make smart decisions as a result. With concurrent planning, operations can be managed more centrally, compressing the time required to achieve results. This way, organizations can respond quickly and accurately to sudden fluctuations in the supply chain.
Ready to learn more about the future of the automotive supply chain? Check out this recent webinar where Harish Iyer of Kinaxis and Karan Clair of Deloitte Consulting, LLP discuss these trends and needs: