Pursuing pole position - Information sharing in the Chinese automotive supply chain
(2012) TMA820 20121Department of Business Administration
- Abstract
- With near stagnant growth in most mature car markets, much of the attention of the world´s car industry has during recent years turned to China. The Chinese car market represents an important business opportunity for OEMs and dealers who want to keep growing and making profits. Initially, the focus of OEMs was mainly on setting up new dealerships, often giving processes and technology lower priority. But as competition increases, voices have been raised that OEMs need to rethink the way they are currently doing business in China. According to supply chain management, one way to compete more effectively is to collaborate and to share information with supply chain partners. However, the knowledge of how information is currently shared in the... (More)
- With near stagnant growth in most mature car markets, much of the attention of the world´s car industry has during recent years turned to China. The Chinese car market represents an important business opportunity for OEMs and dealers who want to keep growing and making profits. Initially, the focus of OEMs was mainly on setting up new dealerships, often giving processes and technology lower priority. But as competition increases, voices have been raised that OEMs need to rethink the way they are currently doing business in China. According to supply chain management, one way to compete more effectively is to collaborate and to share information with supply chain partners. However, the knowledge of how information is currently shared in the downstream part of the automotive supply chain is limited and the challenges that need to be addressed are not yet fully understood.
The purpose of this thesis is to explore the challenges that the downstream part of the Chinese automotive supply chain is facing when sharing information, and to show how these challenges imposes limitations to the way business is conducted.
The empirical foundation of this study is based on 13 qualitative interviews, performed in China during a three months period. Representatives from OEMs, dealers and third parties were chosen to provide a comprehensive picture of the studied environment. The empirics were gathered and analysed simultaneously in order to calibrate the conceptual framework, later used to identify the challenges and the business implications.
Information sharing is an activity that frequently is being conducted by both OEMs and dealers in the Chinese automotive industry, although, the two parties share far from everything with each other. To share everything, as recommended by supply chain literature, seemed far from desirable as several cases of negative consequences as a result of sharing too much information were observed. A number of challenges that impose limitations to the way OEMs and dealers do business were found during the study, mainly originating from will to share information. At the same time, the industry seemed to focus on improvement efforts targeting ability to share, suggesting that the supply chain members have not yet realised the importance of will to share. As the Chinese car market matures, OEMs and dealers will be required to operate their businesses more effectively. OEMs and dealers that realise this, that aim for pole position, and that initiate improvement efforts accordingly, will have a competitive advantage.
In order for OEMs to create a beneficial exchange of information with their dealers the following actions are recommended:
• Create win-more-win-less situations
• Adapt shared systems to dealer requirements
• Treat the dealers as information wells, but make sure to refill them
• Review incentive models (Less)
Please use this url to cite or link to this publication:
http://lup.lub.lu.se/student-papers/record/2612573
- author
- Cewers, Ola LU and Friberg, Michael
- supervisor
- organization
- course
- TMA820 20121
- year
- 2012
- type
- H2 - Master's Degree (Two Years)
- subject
- keywords
- Information sharing, automotive, downstream supply chain, OEM, dealer
- ISSN
- 1651-0100
- language
- English
- id
- 2612573
- date added to LUP
- 2015-08-19 11:17:16
- date last changed
- 2015-08-19 11:17:16
@misc{2612573,
abstract = {{With near stagnant growth in most mature car markets, much of the attention of the world´s car industry has during recent years turned to China. The Chinese car market represents an important business opportunity for OEMs and dealers who want to keep growing and making profits. Initially, the focus of OEMs was mainly on setting up new dealerships, often giving processes and technology lower priority. But as competition increases, voices have been raised that OEMs need to rethink the way they are currently doing business in China. According to supply chain management, one way to compete more effectively is to collaborate and to share information with supply chain partners. However, the knowledge of how information is currently shared in the downstream part of the automotive supply chain is limited and the challenges that need to be addressed are not yet fully understood.
The purpose of this thesis is to explore the challenges that the downstream part of the Chinese automotive supply chain is facing when sharing information, and to show how these challenges imposes limitations to the way business is conducted.
The empirical foundation of this study is based on 13 qualitative interviews, performed in China during a three months period. Representatives from OEMs, dealers and third parties were chosen to provide a comprehensive picture of the studied environment. The empirics were gathered and analysed simultaneously in order to calibrate the conceptual framework, later used to identify the challenges and the business implications.
Information sharing is an activity that frequently is being conducted by both OEMs and dealers in the Chinese automotive industry, although, the two parties share far from everything with each other. To share everything, as recommended by supply chain literature, seemed far from desirable as several cases of negative consequences as a result of sharing too much information were observed. A number of challenges that impose limitations to the way OEMs and dealers do business were found during the study, mainly originating from will to share information. At the same time, the industry seemed to focus on improvement efforts targeting ability to share, suggesting that the supply chain members have not yet realised the importance of will to share. As the Chinese car market matures, OEMs and dealers will be required to operate their businesses more effectively. OEMs and dealers that realise this, that aim for pole position, and that initiate improvement efforts accordingly, will have a competitive advantage.
In order for OEMs to create a beneficial exchange of information with their dealers the following actions are recommended:
• Create win-more-win-less situations
• Adapt shared systems to dealer requirements
• Treat the dealers as information wells, but make sure to refill them
• Review incentive models}},
author = {{Cewers, Ola and Friberg, Michael}},
issn = {{1651-0100}},
language = {{eng}},
note = {{Student Paper}},
title = {{Pursuing pole position - Information sharing in the Chinese automotive supply chain}},
year = {{2012}},
}