29 Sep 2017
Setting Up The New Value Chain Of Customer Centric Innovation
Harish Thyagarajan
#Business | 5 min read
Setting Up The New Value Chain Of Customer Centric Innovation
Harish Thyagarajan

Advancement in communication and technology in combination with the rapid growth of data and information have empowered the global consumers.


The economic events of the recent past highlight the need for the automobile industry to make an effort in understanding as to how the consumers look at the world and what drives their purchasing decisions.


As technology is driving digital transformation to businesses, more opportunities for disruption is emerging from within the industry and from unexpected external threats.


In this digitally connected world, it is really important for the automotive sector to realign its approach to the value chain by aiming to deliver the customer-defined value at each and every touch point.


Only with this approach can businesses be prepared to evolve successfully to face new challenges and possibilities. Customer-centric innovation is of utmost importance in the present era.


Some of the popular automotive organizations across the globe are quite aware of the need to stand out from the rest of the competitors by improving the customer experience and syncing their delivery with customer expectations.


However, there are many companies, that have still not seriously analyzed as to how impactful the customers can be in the process of product innovation.


Here are some of the strategies that automotive companies must take into consideration, in order to dominate the market.



Embracing Human-Centered Processes

For companies across different verticals, the term innovation is all about “quickly” transforming ideas into action. Successful firms embrace small experiments for creating speed and show insights around the innovation that they need in order to stay ahead of the disruptive trends and have an opportunity to lead the change in their industry.


Design Thinking” is a human-centered process, which frames a particular approach to innovation, seen through the eyes of people who will be using it. This is a process that brings in the element of engineering, art, business and technology in the service of solving challenges that matter.


Redefining the Customer experience – Teams will have to embrace traits of creativity, experimentation, and user-centeredness, this will enable the following:

  • Generating volumes of ideas
  • Building many iterative prototypes
  • Sharing work in process with the customers you are designing for


Having a Broader Perspective of What Mobility Enables

The leaders in design thinking have now begun to reframe new questions, discarding the design and structure of cars. They are taking a more system-wide approach in determining how mobility can fit into human lives in the near future.


Companies have now reframed questions like “what can the car do?” to “what does mobility enable people to do?”. New technological investigations can also bring in new ways of framing explorations about the nature of customer driver experience and cars.


Imagine that the new autonomous technology in cars may create a world where at least some of the vehicles would no longer need a steering wheel or various other features that the present day’s cars have.


The question about the driver ergonomics may then be reframed around the values of the multifunctional space in the mobile environment.


Discussion about the streaming media services will no longer be about a balance of media access with driver distraction, but be reframed into one about making the mobile experience all the more like an in-home experience.


Digital Transformation and Human Relationships

Digital business needs a different and transparent relationship with the partners and customers. Old ways of defining relationships as the 360-degree views have to be replaced with an emphasis on the model that helps the customers get the value they desire from their relationship with the organization. This relationship has to be completely built upon the characteristics of respect, relevance, and empathy.


Being Empathetic and Relevant

Digital business relationship to the customer experience represents a shift from focusing on what’s best from an enterprise‘s viewpoint to the end user’s perspective.


At present, the customers value personalization and co-creation of their experiences. Companies must start by understanding the context in which their products or services are being used – why, where and by whom – in order to draft a design that meets the demands of today’s customer.


At the core of understanding the human-centric user experience is the concept of design thinking. Design thinking mainly focuses on the concepts of relevance and empathy – asking questions to reveal how the product or service offers value to the customer.


Respect for the Customer

Digital businesses must understand their customers, know their preferences, and then act on their behalf. The tech-savvy individuals have very little time or patience for the exploitative tendencies of traditional firms – intent on extracting value from them.


Digital firms need to acknowledge the importance of earning customers’ trust and the difficulty of regaining it.


Creating Companies that Facilitate Customer Value

The need for reorienting processes and operations is a natural outcome of the practice of rethinking value to map to customers’ needs and then set up an appropriate culture of innovation around that.


From the past, the business structure of the automotive industry has been driven by the need for internal efficiencies that have resulted in vertically oriented functional structures.


Customers, however, have to be interacting and have the visibility with a firm across vertical functions, given the desire to be able to access many groups continuously across the company. Customers need to engage horizontally.


In the technology-driven companies, where, whatever adds value to the customer experience reigns supreme, it would seem that the auto firms need to start thinking the way that they are organized, at least to that level that they present themselves to customers.


In thinking about processes and structures that follow them, auto companies would be wise to start off by tackling the question – what is relevant to the customer and how they wish to access it.

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