How Connected Cars Could Drive Real Time Aftermarket Supply Chains of the Future
My colleague Steve Keifer recently posted a blog entry about the connected car and I just wanted to take a few moments to extend his thinking a bit further. The connected car will completely change the way in which both the consumer connects with their car and the car connects with its surroundings. The so called ‘internet of things’ is starting to paint a picture of what life will be like when connected devices can interact with each other but what about if they could also interact with a supply chain and hence potentially form a closed loop parts ordering system for rectifying potential faults that may arise in a vehicle?
So imagine the following scenario for a few moments……
A vehicle’s on board computer, or ECU, detects a significant change in flow rates across a water pump. The low flow rate has reached a certain level that could lead to failure. In fact what has happened is that the O-ring seal has a very small split causing water to leak slowly from the cooling system. To compound the issue still further the low level coolant bulb has blown in the instrument cluster so the driver has no way of knowing that the water pump is about to fail. So how can the connected car help?
The flow rate information is sent, via the car’s internet connection, to a central service centre where a database compares the flow rate information received with known failed water pumps from the same manufacturer. The service centre confirms that the O-Ring is about to fail within the next 200 miles and they decide to order a new seal from their supplier and it will be delivered to the nearest repair centre to where the car owner lives. The central service centre also checks the online maintenance schedule of the repair centre and identifies a slot when the seal could potentially be replaced. Once the part has been ordered and the repair slot reserved, the service centre sends the repair information directly to the car owner, either as an email or directly to the car’s infotainment system. The owner is then made aware that the pump is about to fail, a new seal has been ordered and a repair slot has been reserved at their nearest service centre.
For the car owner concerned they are not worried about how the replacement part was automatically ordered but for me this brings together the physical and information supply chains.
In North America, the ‘OnStar’ service has been used for many years to connect cars to a central service centre to help diagnose problems or call for assistance. A cloud based telematics and service environment can potentially change how manufacturers repair and service vehicles. It could also revolutionise the way in which car manufacturers conduct vehicle recalls, such as the airbag recall experienced by four of the Japanese car manufacturers recently. Therfore service centres will be informed of a problem with a vehicle before the driver becomes aware.
The RAC, a leading vehicle recovery service in the UK, recently announced that they would be offering a service that would connect a ‘black box’ to a car’s ECU so that if a problem occurs, the RAC can proactively inform the driver of an impending problem. The RAC clearly realises that the cloud telematics market is potentially large and by offering this service they can retrofit into older cars that may not have any form of internet connection.
At GXS we are seeing some demand now to integrate with Dealer Management Systems, essentially the back office platform that a car dealer uses to manage their inventory and order spare parts. (This integration process provides the ideal opportunity to link the physical and information supply chains together). So with more and more cars being launched with internet connectivity, is there an opportunity to integrate to a back end B2B platform to take care of the parts ordering process via traditional EDI transactions?, well of course there is!
Companies have been automating their ordering processes via the exchange of EDI or electronic business documents for many years. The cloud based telematics system potentially allows the consumer to be integrated with an automated ordering process and hence aftermarket supply chain. This in turn helps to improve efficiencies, reduce repair/spare part inventory levels at a dealer but more importantly improves customer loyalty and brand loyalty. In closing, I guess in the perfect world the next step would be to have an autonomous car drive itself to a service centre whenever a problem was detected, but I will leave that thought right there for the moment! I will continue the discussion about the future internet of things in future blog posts.