What the Automotive Industry Can Teach Us About Flexibility and Agility

This week I attended the Center for Automotive Research’s Management Briefing Seminars (better known as CAR MBS) in Traverse City, Michigan. I was there to connect with automotive executives, learn more about the critical concerns for the industry, and get a glimpse into where things are going in the future. CAR MBS is an annual event attended by more than 1000 key industry stakeholders and a great opportunity to learn about the latest automotive trends while building relationships.

To say the automotive industry is facing massive uncertainty is an understatement. Many believe the next ten years will bring more change than the last thirty. The industry has a lot to think about: autonomous and semi-autonomous vehicles, electrified and electric propulsion systems, ride hailing vs. car sharing vs. automobile ownership, disruptive technologies and new upstart competitors, and an ever-evolving regulatory environment.

But the auto industry is tough and not known for backing down from challenges. They will find ways through the uncertainty, adapt, and persevere. One common theme that emerged at CAR MBS was the importance of flexibility in such an uncertain environment.

A Toyota executive spoke about manufacturing flexibility. He explained how Toyota is reconfiguring a still-under-construction manufacturing facility in Mexico. The factory was originally intended to assemble Corolla sedans but will now produce Tacoma trucks instead. This change, which normally would involve significant delays, was not considered a big deal: “Frankly, it had no impact on us.” That is because Toyota is building flexibility into their assembly plant designs, which is one way to deal with uncertainties in consumer demand and manufacturing capital requirements.

A GM executive discussed the importance of flexibility to powertrain engineering. Watching representatives from CAR, Honeywell, Delphi, Magna, and GM all show their forecasted projections for the propulsion technology mix in the coming years made one point clear: nobody knows for sure. That uncertainty is why GM stressed the importance of flexibility to their evolving propulsion approaches. Automobiles may be propelled by traditional internal combustion engines, a variety of hybrid “electrified” systems, or purely electric motors. GM is proactively working on each of these technologies to improve their agility in a shifting market.

These automotive lessons can be extended into every industry facing future uncertainty. Building flexibility into your business wherever possible enables a greater ability to quickly adapt to change, which is the definition of agility.

Flexibility is why many customers select Ivalua as their procurement empowerment platform. They understand that their business will evolve and want a solution platform that can evolve with them. Ivalua’s unmatched flexibility and ease of configuration are core design principles driven by our customers’ requirements for greater agility.

Is your source-to-pay solution flexible enough to provide the agility you need? If not, please request a demo and see what Ivalua can do for you.