Over the last several weeks we have been reviewing Wikinomics, the word coined to describe a new global manufacturing era where openness, peering, sharing and acting globally are transforming manufacturing into the Global Factory. We’ve briefly looked at how Boeing, BMW and the Chinese motorcycle company, Lifan, have used this concept to develop new technologies that have increased innovation and reduced costs. We all should learn from these examples. What are the lessons that the authors of “Wikinomics, How Mass Collaboration Changes Everything” think are important?
1. Focus on the critical drivers.Competition and the rapid pace of change can make today’s competencies into commodities overnight. Look for where future opportunities for value creation are shifting, and ensure that your core competencies are evolving in that direction. Always strive to be the best at what your customers value the most and partner with everything else. This is much more than outsourcing.
2. Add value through orchestration.The process of weaning yourself from the old ways will be difficult. Many are going to be fearful that you are giving up critical engineering skills to future competitors. Managers will question the ability to manage relationships at a distance and sometimes across cultures. But there can be significant rewards for those who learn to harness the competencies of others for new innovations.
3. Instill rapid, iterative design processes.A wide range of partners, each of whom is motivated to solve problems related to their key area of expertise, can accomplish rapid design changes. Settle on the core modular architecture that will enable the suppliers to design compatible components and assemblers to integrate the components and subsystems into the finished product.
4. Harness modular architecture.Create standards that specify product interfaces and leave it up to the suppliers to get the job done. Abandon the view that outsourcing is just a way to unload costs. Look at it as a way to gain speed, innovation and knowledge. Collaborate closely to transfer skills and know-how across boundaries.
5. Create an egalitarian system.In the past, companies told suppliers to cut prices or lose the business. Today, suppliers are becoming partners, not adversaries. Sharing information as part of the system development enables the network of partners to act as a single entity. Success or failure affects everyone.
6. Share the costs and risks.Sharing the risks keeps everyone motivated. But at the same time, those sharing the risk should also participate in the decision making.
Your role as a senior manager in this environment is to keep your eye on the future. How will the global plant floor and techniques impact your business? How can it transform your company?