Establishing a co-creation approach can help automotive manufacturers to engage more closely with their customers, dealers, suppliers and employees.

Automotive Sector Seeing the Benefits of the “Collaborative Power of Co-Creation”

Co-creation methods are likely to be implemented by original equipment manufacturers (OEMs) in the automotive industry at a faster pace over the next five years, reveals a recent report by business consultancy firm PwC.  The report, entitled ‘Looking Ahead: Driving co-creation in the auto industry’, indicates that automobile manufacturers which leverage assessments and data fed back from the social media channels of the various stakeholders in the value chain are gaining competitive advantage. This is especially the case with Ford and Volkswagen, two examples cited by the PwC analysts. These firms have succeeded in improving their relations with both customers and suppliers by applying this business model.

Competitive advantage

In 2005, Ford introduced its Aligned Business Framework (ABF) programme, which was designed to strengthen collaboration and develop a sustainable business model with its suppliers in order to drive mutual profitability and technology development. The programme called for greater transparency on Ford’s part, which has in parallel led to a reduction in risks linked to operational issues, an improvement in relationships with suppliers, plus  alignment of objectives internally . First and foremost however, automobile OEMs now have the tools to connect with customers in an ongoing interactive dialogue through social media, enabling them to improve the efficiency of product design.  In 2011, Volkswagen set up an interactive Internet site with a view to opening a dialogue on future mobility issues. Close to 13 million visitors went on to the site and 200,000 of them submitted design ideas. The project moreover enabled Volkswagen to become “the most digitalised auto brand in China”, says PwC.

Internal engagement strategies too

Co-creation is thus emerging as a standard way of collaborating in the automotive sector. The PwC report also underlines that establishing the right interactive engagement platforms to ensure collaboration among and receive comments from employees also helps to improve “employee satisfaction and morale” and provides a way to “foster an innovation culture throughout the organisation.” However, although collaborative methods could well lead to the automotive industry becoming more connected and more profitable, some experts point out that there is currently a shortage of qualified automobile engineers. Recruitment challenges of this kind might put the brakes on co-creation strategies.

By Pauline Trassard