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Platform Thinking is the Future of Aftersales Business in the Automotive Industry

How can Platform Thinking be adapted in order to create a new standard for conceiving products or services in aftersales business within the automotive industry? For quite some time, this question has been going through my mind while consulting on issues in different projects in aftersales in the automotive industry. The encountered issues were mostly correlated to a strong focus on product thinking. As I am sure that many other people are also concerned with similar issues, I have decided to share my thoughts with a wider audience. Therefore, I am going to give a comprehensive keynote speech at the 5th International Conference and Exhibition on Automobile Engineering in Rome in September 2018. In this blog post, which is based on my abstract for this conference, I want to share some brief thoughts regarding the use of platform thinking in the context of aftersales business in the automotive industry.

The digitalization of the automotive industry and in particular of aftersales business has led to a short-living and fast moving way of releasing products or services, i.e., the most up-to-date product or services today will be outdated tomorrow. Consequently, a steady source of incomes from aftersales business cannot be guaranteed anymore.

To be able to generate steady and reliable profits again in aftersales business in automotive industry a switch from product thinking to Platform Thinking is required.

Platform Thinking can be defined as the art of conceptualizing and implementing inclusive places (physical or virtual) where different actors can interact, communicate, co-create and share. A successful platform is able to attract platform users, facilitate the interaction and exchange of information and foster co-creation of value [1,2].

In the following, we adapt this general definition of platform thinking to present a Platform-Thinking-method illustrated by real use-cases encountered in aftersales business in automotive industry.

The proposed method bases upon the consideration of the platform users and their interaction, the exchanged data and the pricing model as key factors to conceive and build a new platform.

It is crucial to decide which platform users or target groups need to be brought together. In aftersales business in the automotive industry, potential target groups are car drivers, car dealers, fleet managers and third parties such as car insurance companies and towing services.

The challenge is then to visualize a possible interaction between these groups, which can lead to creation of value for each group during an exchange of relevant information. Typical information is car-specific information such as mileage, diagnostic data, service due times, battery charging status and forecast information but also private information such as name, contact data, address and age of the platform user.

Next, we have to define which information is attractive to a platform user in order to specifically address the needs of another platform user. The identified information has to be transmitted by the car over-the-air to the backend system. For instance, information about the mileage is a great deal to a car insurance company in order to create value for its own business.

Finally, the pricing model for using the platform has to be well thought out in order to ensure profitability for the platform owner. A few alternatives would be to charge fees for each login on the platform or each data package transferred between users depending on the user´s behavior.

I hope this initial overview has shown you the opportunities that Platform Thinking provides for developing a new standard for aftersales business in the automotive industry. Furthermore, I wanted to lay out some of the steps necessary for adapting platform thinking for that context. In addition, it was my goal to point out some of the difficulties and impediments that have to be considered in this path.

In general, I would be glad if was able to raise your interest for the topic and for my keynote speech at the 5th International Conference and Exhibition on Automobile Engineering in Rome in September this year, where I will share much more detailed thoughts on the approach of Platform Thinking within an aftersales context.




[1] https://www.slideshare.net/edzaizvobwo/platform-thinking-for-educational-success

[2] http://ebusiness.mit.edu/platform/agenda/slides/8%20Sangeet-MIT%20FINAL.pdf

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