Is Ford's auto-xchange the "Real Deal?" (Survey Response 3)
Is Ford's auto-xchange the "Real Deal?" (Survey Response 3)
Answers (7) Geert Heyrman
Junior Chief Purchasing Officer at GasthuisZusters Antwerpen (GZA)
see all my answers
Best Answers in:
Purchasing (1)... see more, Economics (1), Business Development (1), Planning (1), Inventory Management (1), Project Management (1) see less
Private Answer:
Hi Jon,
I will answer your question this weekend. Today is a little hectic, and I need a little time to prepare to the point that I can add value. Some of the elements on your procureinsight blog are new to me so I have to look into it a little deeper in order to have a good starting point.
I'll give a full review by the end of this weekend. By the way love your blog. Very insightfull.
Kind regards from Belgium,
Geert
Messages from Geert Heyrman (1):
RE: Is Ford’s auto-xchange the “Real Deal?”
posted 19 days ago | Reply to Geert Heyrman
Roel van de Vrande
Sales Manager at Quyntess
see all my answers
Best Answers in:
Customer Relationship Management (1)... see more, E-Commerce (1) see less
Jon,
Good question and as always a yes/no answer can not be given although I tend towards a YES.
The vision of creating a 'Single version of the Truth (SVOT)' environment (Chainlink report) is the way forward, I believe. The film however does not tell me anything with regard to the architecture or choices made to realize this. Of course it took them only 6 months.
It seems to focus on customer experience and in that case, the web is a logical choice. To reach full potential however expect that existing B2B solutions (EDI, automotive has come a long way), used by Ford's business partners are integrated as well.
Synergy can be realized by connecting all OEM's and Suppliers to a hub (connect once, connect to all - Elemica) and reduce the complexity of point-to-point connections. This mother of all Hub's (or a combination of existing Hub's) can only exist if B2B communications become a commodity and should be separated from the content as this will remain a way to stand out from competitors. Also, this should not be just an Automotive initiative on the long run.
To create transparency and enable collaboration in a Supply practise, you would still have to solve the issue of ownership and responsibility. Establishing a neutral entity will be difficult working with multiple OEM's and companies will not accept Agent technology or solvers to take discusions for them from day 1 (will they ever?).
Creation of multiple Control Towers or 'Single versions of the truth' created by OEM's partnering, Government (Ports?) or 'neutral' entities seems to be a first step but in my opinion the way forward.
Over the last 2 years, we have created 5 different SVOT's based on innovative services of our integration partner allowing companies to interact (integrate and collaborate) with all their partners. (It's not up to me to evaluate what approach is best).
Regards
Messages from Roel van de Vrande (1):
RE: Is Ford’s auto-xchange the “Real Deal?”
posted 18 days ago | Reply to Roel van de Vrande | Flag answer as...
Rick Feltenberger
Principal, The Supply Chain Center
see all my answers
Best Answers in:
Supply Chain Management (17)... see more, Manufacturing (5), Inventory Management (4), Small Business (4), Packaging and Labeling (3), Distribution (3), Starting Up (2), Facilities Management (1), Purchasing (1), Education and Schools (1), Economics (1), Business Analytics (1), Planning (1), Project Management (1), Business Plans (1), Enterprise Software (1), Computers and Software (1) see less
Jon, frankly I think FMC is on its last legs. They face the same problems today as they did 10 years ago when they had a real opportunity to address them.
True, they are a big company (as Jim smirked); but in reality it is about $160 billion in cost and very little profit. That makes them a very small company in my mind. Their problem is that they have historically relied on "industry insiders" and shunned anyone from the outside with innovative ideas. A-X could be the first crack in their armor of letting fresh innovation inside.
They sound like their moving to a marketing company more than a manufacturing company.
I don't think I'm onboard with your view:
“The key starting point is to recognize that the term supply chain is a misnomer in that it implies a sequential order of events (in the spirit of your question, a non-deterministic set of algorithms which aligns with the equation-based modeling used by most software vendors).
Forward thinking companies have always see the supply chain as non-sequential. They didn't always have the best solutions, but the approach was correct.
Rick...
Messages from Rick Feltenberger (3):
RE: Is Ford’s auto-xchange the “Real Deal?”
RE: Is Ford’s auto-xchange the “Real Deal?”
RE: Is Ford’s auto-xchange the “Real Deal?”
posted 18 days ago | Reply to Rick Feltenberger | Flag answer as...
Douglas Simpson
Insurance Law Consultant and Attorney
see all my answers
Best Answers in:
Using LinkedIn (3)... see more, Ethics (1), Professional Networking (1), IPO (1), Treaties, Agreements and Organizations (1), Corporate Law (1), Property Law (1), Business Development (1), Change Management (1), Organizational Development (1), Manufacturing (1), Personal Real Estate (1), Small Business (1), Starting Up (1) see less
Ford has an unfortunate recent history of pledges and "bold decisions" it then reneged on.
AutoSavant's Chris Haak yesterday mentioned Ford's pledge to reduce CO2 emissions by 30% between now and 2020, then discussed what that would mean. In the course of that discussion (link below), she pointed out:
quote:
Of course, the two most famous examples of Ford making bold claims about environmental initiatives only to renege on them later were when Bill Ford said in 2000 that the company would improve the fuel efficiency of its SUVs by 25%, and when the company promised in 2005 to build 250,000 hybrid vehicles per year by the end of the decade. The SUV fuel efficiency pledge was officially annulled in 2003, and the hybrid production pledge was in 2006, just a year after it was first announced.
endquote.
So, I'd take anything Ford executives say with a "show me" attitude. Public statements like these from upper management do not always indicate any change inside the culture of the organization's middle management and production processes.
My Response:
To what would you attribute these vacillations? Is it a deliberate attempt to deceive on the part of management or is it driven by other factors such as a declining economic condition?
Do you feel that there is a way to effectively combine socially responsible imperatives such as those you had described in your response with the economic factors that influence the adherence to said policies?
For example, can you demonstrate a positive (or for that matter any) financial impact associated with a reduction in CO2 emissions or the production of a fuel efficient SUV from both an internal (being Ford) and external (re societal) perspective? Are there specific formulas for quantifying said financial calculations.
I fully support and agree that there needs to be the proactive development of effective policies and practices that recognize and stimulate positive action being taken on issues of sustainability or green purchasing. However, when one is struggling financially, even the best of intentions (and programs) will succumb to the fiscal realities associated with survival. Or to be more succinct, it becomes a question regarding the degree of necessity versus nicety (even if said nicety is as important an issue as sustainability).
Douglas' Closing Comment:
I have no inside information, but some analysts I read attributed Mr. Ford's change of heart to resistance inside the organization and "be a team player" political pressure on him by the interests that would benefit by corn ethanol (farm states, ADM and Conagra) and petroleum interests opposed to improved CAFE standards. All these have a vested stake in not improving fuel economy and maintaining the credibility of a fiction that it is not possible without unacceptable sacrifices.
The challenge of trading future profits for present earnings is a classic issue best addressed by Clayton Christensen in "The Innovator's Dilemma," which should be required reading for anyone in business. I've written a bit about it in my weblog. He details how intelligent business people, making rational economic decisions, have been repeatedly defeated by a "disruptive technology."
For decades, Warren Buffett has beat his competition by putting long-term value ahead of short-term earnings goals. Every year in his annual report to shareholders, he explains his business strategy, and every year those who perform worse dismiss it as inconsistent with the realities of their world driven by quarterly earnings expectations.
As to the economic impact of reduction of CO2 emissions, I am not an economist. Sir Nicholas Stern is, and in his 2006 report, "The Economics of Climate Change," he ran the numbers and calculated that unchecked human-caused global warming will cause trillions of dollars in damages in our lifetimes, with impact comparable to a world war or global depression, but shifting to a low-carbon economy will bring huge economic growth opportunities. The economic benefit of reducing carbon emissions could total $2.5 trillion each year. Sir Nicholas is Head of the U.K.'s Government Economic Service and former World Bank Chief Economist. In his ~600 page report and appendices, you'll find all the calculations you could want, including cost benefit analyses of various alternative forms of energy production at various cost points of carbon.
Of course, those gains won't be enjoyed by the same companies as today profit from carbon extraction and emission. Industries like wind power, nuclear, solar, etc. will benefit from a "carbon-constrained" world. Others like coal miners and burners and high-cost SUV makers will lose. The latter are spending millions on disinformation campaigns and lobbying, just as the tobacco companies did for decades, to preserve their profits and to discourage competing technologies.
Psychologists long ago documented the human tendency to discount future savings more than a present expense. That is one reason so many think CFL bulbs that will last 1-3 years are "too expensive" because they cost more up front than a incandescent that will use 4x the electricity and have to be replaced 4-8 times a year. Every month, I save enough electricity to pay for all the ~50 CFLs in my home. And I have yet to replace one 20 months later. Try explaining that to most folks, and you just get "They are just too expensive."
Is Fords autoxchange the Real Deal Survey Response 3 - To learn more about this author, visit Jon Hansen's Website.
Like this article? Share it with your friends
Doug, Insurance Law Consultant and Attorney, Hartford, U.S.
Answers (7) Geert Heyrman
Junior Chief Purchasing Officer at GasthuisZusters Antwerpen (GZA)
see all my answers
Best Answers in:
Purchasing (1)... see more, Economics (1), Business Development (1), Planning (1), Inventory Management (1), Project Management (1) see less
Private Answer:
Hi Jon,
I will answer your question this weekend. Today is a little hectic, and I need a little time to prepare to the point that I can add value. Some of the elements on your procureinsight blog are new to me so I have to look into it a little deeper in order to have a good starting point.
I'll give a full review by the end of this weekend. By the way love your blog. Very insightfull.
Kind regards from Belgium,
Geert
Messages from Geert Heyrman (1):
RE: Is Ford’s auto-xchange the “Real Deal?”
posted 19 days ago | Reply to Geert Heyrman
Roel van de Vrande
Sales Manager at Quyntess
see all my answers
Best Answers in:
Customer Relationship Management (1)... see more, E-Commerce (1) see less
Jon,
Good question and as always a yes/no answer can not be given although I tend towards a YES.
The vision of creating a 'Single version of the Truth (SVOT)' environment (Chainlink report) is the way forward, I believe. The film however does not tell me anything with regard to the architecture or choices made to realize this. Of course it took them only 6 months.
It seems to focus on customer experience and in that case, the web is a logical choice. To reach full potential however expect that existing B2B solutions (EDI, automotive has come a long way), used by Ford's business partners are integrated as well.
Synergy can be realized by connecting all OEM's and Suppliers to a hub (connect once, connect to all - Elemica) and reduce the complexity of point-to-point connections. This mother of all Hub's (or a combination of existing Hub's) can only exist if B2B communications become a commodity and should be separated from the content as this will remain a way to stand out from competitors. Also, this should not be just an Automotive initiative on the long run.
To create transparency and enable collaboration in a Supply practise, you would still have to solve the issue of ownership and responsibility. Establishing a neutral entity will be difficult working with multiple OEM's and companies will not accept Agent technology or solvers to take discusions for them from day 1 (will they ever?).
Creation of multiple Control Towers or 'Single versions of the truth' created by OEM's partnering, Government (Ports?) or 'neutral' entities seems to be a first step but in my opinion the way forward.
Over the last 2 years, we have created 5 different SVOT's based on innovative services of our integration partner allowing companies to interact (integrate and collaborate) with all their partners. (It's not up to me to evaluate what approach is best).
Regards
Messages from Roel van de Vrande (1):
RE: Is Ford’s auto-xchange the “Real Deal?”
posted 18 days ago | Reply to Roel van de Vrande | Flag answer as...
Rick Feltenberger
Principal, The Supply Chain Center
see all my answers
Best Answers in:
Supply Chain Management (17)... see more, Manufacturing (5), Inventory Management (4), Small Business (4), Packaging and Labeling (3), Distribution (3), Starting Up (2), Facilities Management (1), Purchasing (1), Education and Schools (1), Economics (1), Business Analytics (1), Planning (1), Project Management (1), Business Plans (1), Enterprise Software (1), Computers and Software (1) see less
Jon, frankly I think FMC is on its last legs. They face the same problems today as they did 10 years ago when they had a real opportunity to address them.
True, they are a big company (as Jim smirked); but in reality it is about $160 billion in cost and very little profit. That makes them a very small company in my mind. Their problem is that they have historically relied on "industry insiders" and shunned anyone from the outside with innovative ideas. A-X could be the first crack in their armor of letting fresh innovation inside.
They sound like their moving to a marketing company more than a manufacturing company.
I don't think I'm onboard with your view:
“The key starting point is to recognize that the term supply chain is a misnomer in that it implies a sequential order of events (in the spirit of your question, a non-deterministic set of algorithms which aligns with the equation-based modeling used by most software vendors).
Forward thinking companies have always see the supply chain as non-sequential. They didn't always have the best solutions, but the approach was correct.
Rick...
Messages from Rick Feltenberger (3):
RE: Is Ford’s auto-xchange the “Real Deal?”
RE: Is Ford’s auto-xchange the “Real Deal?”
RE: Is Ford’s auto-xchange the “Real Deal?”
posted 18 days ago | Reply to Rick Feltenberger | Flag answer as...
Douglas Simpson
Insurance Law Consultant and Attorney
see all my answers
Best Answers in:
Using LinkedIn (3)... see more, Ethics (1), Professional Networking (1), IPO (1), Treaties, Agreements and Organizations (1), Corporate Law (1), Property Law (1), Business Development (1), Change Management (1), Organizational Development (1), Manufacturing (1), Personal Real Estate (1), Small Business (1), Starting Up (1) see less
Ford has an unfortunate recent history of pledges and "bold decisions" it then reneged on.
AutoSavant's Chris Haak yesterday mentioned Ford's pledge to reduce CO2 emissions by 30% between now and 2020, then discussed what that would mean. In the course of that discussion (link below), she pointed out:
quote:
Of course, the two most famous examples of Ford making bold claims about environmental initiatives only to renege on them later were when Bill Ford said in 2000 that the company would improve the fuel efficiency of its SUVs by 25%, and when the company promised in 2005 to build 250,000 hybrid vehicles per year by the end of the decade. The SUV fuel efficiency pledge was officially annulled in 2003, and the hybrid production pledge was in 2006, just a year after it was first announced.
endquote.
So, I'd take anything Ford executives say with a "show me" attitude. Public statements like these from upper management do not always indicate any change inside the culture of the organization's middle management and production processes.
My Response:
To what would you attribute these vacillations? Is it a deliberate attempt to deceive on the part of management or is it driven by other factors such as a declining economic condition?
Do you feel that there is a way to effectively combine socially responsible imperatives such as those you had described in your response with the economic factors that influence the adherence to said policies?
For example, can you demonstrate a positive (or for that matter any) financial impact associated with a reduction in CO2 emissions or the production of a fuel efficient SUV from both an internal (being Ford) and external (re societal) perspective? Are there specific formulas for quantifying said financial calculations.
I fully support and agree that there needs to be the proactive development of effective policies and practices that recognize and stimulate positive action being taken on issues of sustainability or green purchasing. However, when one is struggling financially, even the best of intentions (and programs) will succumb to the fiscal realities associated with survival. Or to be more succinct, it becomes a question regarding the degree of necessity versus nicety (even if said nicety is as important an issue as sustainability).
Douglas' Closing Comment:
I have no inside information, but some analysts I read attributed Mr. Ford's change of heart to resistance inside the organization and "be a team player" political pressure on him by the interests that would benefit by corn ethanol (farm states, ADM and Conagra) and petroleum interests opposed to improved CAFE standards. All these have a vested stake in not improving fuel economy and maintaining the credibility of a fiction that it is not possible without unacceptable sacrifices.
The challenge of trading future profits for present earnings is a classic issue best addressed by Clayton Christensen in "The Innovator's Dilemma," which should be required reading for anyone in business. I've written a bit about it in my weblog. He details how intelligent business people, making rational economic decisions, have been repeatedly defeated by a "disruptive technology."
For decades, Warren Buffett has beat his competition by putting long-term value ahead of short-term earnings goals. Every year in his annual report to shareholders, he explains his business strategy, and every year those who perform worse dismiss it as inconsistent with the realities of their world driven by quarterly earnings expectations.
As to the economic impact of reduction of CO2 emissions, I am not an economist. Sir Nicholas Stern is, and in his 2006 report, "The Economics of Climate Change," he ran the numbers and calculated that unchecked human-caused global warming will cause trillions of dollars in damages in our lifetimes, with impact comparable to a world war or global depression, but shifting to a low-carbon economy will bring huge economic growth opportunities. The economic benefit of reducing carbon emissions could total $2.5 trillion each year. Sir Nicholas is Head of the U.K.'s Government Economic Service and former World Bank Chief Economist. In his ~600 page report and appendices, you'll find all the calculations you could want, including cost benefit analyses of various alternative forms of energy production at various cost points of carbon.
Of course, those gains won't be enjoyed by the same companies as today profit from carbon extraction and emission. Industries like wind power, nuclear, solar, etc. will benefit from a "carbon-constrained" world. Others like coal miners and burners and high-cost SUV makers will lose. The latter are spending millions on disinformation campaigns and lobbying, just as the tobacco companies did for decades, to preserve their profits and to discourage competing technologies.
Psychologists long ago documented the human tendency to discount future savings more than a present expense. That is one reason so many think CFL bulbs that will last 1-3 years are "too expensive" because they cost more up front than a incandescent that will use 4x the electricity and have to be replaced 4-8 times a year. Every month, I save enough electricity to pay for all the ~50 CFLs in my home. And I have yet to replace one 20 months later. Try explaining that to most folks, and you just get "They are just too expensive."
Is Fords autoxchange the Real Deal Survey Response 3 - To learn more about this author, visit Jon Hansen's Website.
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