Minding your own business

Jeff Jarvis argues in his book What Would Google Do? that Detroit should learn the power of collaboration and open design from Google. While there are challenges in implementing a cost-effective business model around collaborative automobile design and production, perceiving the concept with an end-of-the-pipeline mentality doesn't help either.

CarZen provides an excellent recommendation service that suggests cars that suit a buyer's needs. I was reminded of the innovative supply chain model that Dell pioneered during its initial days of glory -- letting customers make their own computer, and assembling the personalized computer through JIT inventory management. Detroit may not be eager to merge CarZen's recommendation service with Dell's personalized assembly line to make cars that serve unique customer needs.

Nevertheless, it is important that auto makers understand the business they're in. As Rishad Tobaccowala of ad giant Publicis points out, auto makers ironically are not in the business of making automobiles, but in the business of Navigation and Entertainment. Given that people need to navigate from point A to point B, and spend considerable time doing so, it should be a no-brainer that adding value in the process of fulfilling these needs should help differentiate and reap profits.

When McDonald's founder Ray Kroc asked a group of B-School graduates "What business do you think I'm in?", the graduates thought that he was just fooling around. Ray surprised them claiming that he was not in the business of flipping hamburgers, but in the business of real estate. He went on to detail that the focus of his business plan was to sell hamburger franchises, and that the location of those franchises was key to their success. We know that McDonald's doesn't make the best burgers in the world, nor does it provide the best dining experience. Yet, it takes some pondering to determine the actual business that a player is in. Recognition of the basics can be a profound experience, and can indeed be transformed into a black swan with the right execution strategies.

The idea of a personalized car may be romantic, to say the least, and may not be Detroit's silver bullet even in this era of personalization. Meeting energy efficiency goals stipulated through regulations screams "end-of-the-pipe" and may come at a cost [if not approached holistically]. It needs to be said that leaders identify themselves not by following the fads of the day, but by identifying their purpose for existence and by changing the way the world operates, not due to an urge to do so, but simply by following function.