Chris Daglis, Managing Director of Auto PARTnered Solutions, based in Australia, who has involvement in many global industry initiatives relating to the auto recycling industry, discusses vehicle technology and the auto recycler’s role in this ecosystem of a Touchless Supply Chain (TSC).
It’s 2021, and we do not have any flying cars yet.
Technology is evolving so quickly that it is probably surprising that we have not seen a flying car yet. After all, the electric vehicle, passenger and commercial, seems a little old school now – it’s becoming a little boring hearing about the same thing every day…
Now I’ve said a bit on electric vehicles and the opportunity changes in vehicle technology will bring to the table for the industry.
But today I want to talk about how the use of technology will change and the effect it will have on the supply chain. While reading this, think about your business and how it sits within this ecosystem, if at all.
So, come for a ride with me down this path of events for a minute. Imagine this:
A vehicle is involved in an accident.
Instantly, a claim is raised by the insurer (because the on-board computer tells them within seconds), and…
They know where you are so the taxi/uber is already on the way to pick you up.
They know how big the accident is and which parts are damaged.
They know which parts need to be replaced and which need to be repaired.
They know what parts are available for the repair of the vehicle.
They know when they can receive these part options and each of their prices.
They know which repairer has capacity to complete the repair and what their rate for the repair is.
The tow truck is on its way to collect the vehicle to take it to that repairer.
The optimum parts mix is on the way to meet the damaged vehicle at the repair facility.
The vehicle is repaired and returned to the owner within a few days.
Whoa!! What just happened?
Not sure if you even noticed, but your phone didn’t ring, nor did you receive a request for a part. No chance to talk to the repairer, to see what they need to pay for the part or if you could upsell a warranty.
The question is, what role will the auto recycler play in this ecosystem of a Touchless Supply Chain (TSC)?
The answer is, VERY LITTLE if the auto recycler doesn’t keep up with the minimum requirements demanded of him/her in order to play.
Now just like the flying car, it’s not here yet, but nor was the electric car so relevant 5 years ago. As insurers and vehicle manufacturers work towards such TSCs, the auto recycling industry must also begin the journey towards such an end state. This is not a quick fix type of deal. It will take years of action, but more importantly, years of cooperation by all the key stakeholders in the auto recycling industry to build the infrastructure required just so it can put on the shirt to go out and compete, to play in this game.
We must also start thinking about challenging what we know and start looking further ahead into what we do not know. Some may need to let go of some of the business models they have invested so much time, effort and money into and reinvent themselves. As I said in my last article, this is not easy. We will need to change the lens through which we view the world as we know it, the box within which we think.
It is not good enough to think outside the square anymore, that is too flat (diagram 2). We have moved from one-dimensional thinking (diagram 1) to two dimensional, but even there our thinking is still too narrow. The danger is, and I am guilty of this too, that we now think that by thinking a little outside the square, we are being different. This is no longer good enough.
We are not considering our relationship with the other parts of the market and as a result, those forces move while we stay still.
It is time that we now, and very quickly, start to think through a multi-dimensional lens, to think and act in and out of the three-dimensional box. This means that we need to think more strategically about our role and place in the new Touchless Supply Chain that will emerge.
In the future, Chris will dig deeper into each segment of the supply chain that will play a role in the TSC and the interconnectedness of the auto recycler with this brave new world.