U.S. auto industry needs mass customization to reinvent itself

In July 2004, I was contacted about giving a speech to a global automobile association industry meeting in Santiago, Chile. I put together a proposal and, after a few days, learned that the program had been postponed indefinitely. Yesterday, I stumbled across my original proposal.

Proposed Program:

The DELLification of the Automobile Industry—Can the Industry Continue to Ignore This Transformational Opportunity?

Michael Dell is well known for encouraging the automobile industry to embrace the concepts of “build-to-order” (mass customization). In a Wall Street Journal article Reshape Your Business With Help From the Web about the relationship of Michael Dell and then Ford CEO Jacques Nasser, the article makes the following point:

“Why would a huge auto maker seek Mr. Dell’s advice? Because Dell Computer’s ultrafast build-to-order approach—which allows the company to put a customer’s money in the bank before it pays for parts and labor generates 165% return on invested capital, not to mention stock valuations a Detroit chief executive officer can only dream of.”

Wired magazine offers the following thought:

“The Dellification of a [major automotive company] is only a gutsy CEO away.”

Proposed topics include:

Why the automobile industry can’t ignore this new paradigm
How the world is changing and how the automobile industry is not
How customer expectations affect relationships with manufacturers
Implementation challenges with a new paradigm such as mass customization
How does the manufacturer’s world change? How does the Dealer’s world change?
How does the Customer’s world change?
What are the customer’s expectations?
Critical beliefs of “mass customizers”
Comparison of “mass production” to “mass customization”
Benefits of “mass customization”
Attributes of an effective “mass customization” solution across the enterprise and beyond the enterprise
Information Technology Challenges
While Dell’s overall business execution has suffered in the last few years, the underlying premise behind mass customization and build to order is sound. This program would be as appropriate today as when I proposed it five years ago. Mass customization is perhaps even more relevant today as the U.S. automobile manufacturers look to reinvent themselves and dramatically change their cost structures.

What do you think?

David J. Gardner, Mass Customization Expert

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