Mozart was certainly a musical genius, but he needed other musicians to perform his works so that their magnificence could be both realized and recognized. Einstein was a questionable genius—perhaps the single person that many of us think of when we hear the word genius—but had he written his equations on the back of an application in the Bern patent office, his genius would have extended no further than the distance contained in his considerable cranium.
Context means that there must be the involvement of other people. If Mozart had written works that were so demanding that there was a physical or practical impossibility for even the most-accomplished musicians to perform them, then he would probably be known—if at all—as some sort of eccentric. If there weren’t people like Max Planck back in Einstein’s day, then, perhaps, his name would be buried somewhere in the annals of the Swiss bureaucracy.
Ecosystem? Yes. Sometimes there is the concept of an auto company or of a group of companies (e.g., “The Big Three”) as a group onto themselves. The network of links—suppliers at one end and end consumers at the other—isn’t taken into account. While this isn’t troublesome for most purposes, in working fact, it matters considerably. The ecosystem is the context in which the industry works. But if one part of that system is in some way damaged or otherwise put out of sorts, then there are difficulties for the other portions of the system.
It almost seems as though there are some people at some auto companies who seem to think that they are veritable Mozarts of the motor industry. They apparently perceive themselves as the solitary genius, working wizardry the likes of which the General Theory of Relativity pales by comparison. They don’t understand context. They don’t understand the ecosystem.
There are people at vehicle manufacturing companies that understand context. Dr. John Henke, Jr., is the president of Planning Perspectives (Birmingham, MI; www.ppi1.com). Planning Perspectives is a consultancy that conducts surveys and performs analysis of the auto industry. Recently, Planning Perspectives performed its 4th annual survey of North American suppliers. There were valid responses from 223 Tier 1 suppliers, including 36 of the top 50. The group’s sales represent 48% of the 2003 purchase from GM, Ford, DCX, Toyota, Honda, and Nissan. One result: “Suppliers overwhelmingly prefer working with Honda and Toyota.”* Another result: “Chrysler, Ford and GM suppliers are falling behind Honda and Toyota at an increasing rate.” And, not to belabor this point, one more: “Suppliers are shifting resources (capital and R&D expenditures, service and support) to [the] Japanese Big Three, while reducing these for [the] Domestic Big Three.” Which is to say that the ecosystems of Toyota and Honda are robust while those of GM, Ford and DCX are diseased. The consequences of this are evident and will become more so if things don’t change. Without a viable context of other parties, it will be simply impossible for some of the vehicle manufacturers to make “great” products short of a total return to vertical integration.
*On a scale from 0 (very poor) to 500 (very good) a “working relations index” was created by Planning Perspectives. It looks at five factors: Relationship; Communication; OEM Help; OEM Hindrance; Profit Opportunity. In it, GM rated 144; Ford 160; Chrysler 183; Nissan 294; Honda 384; Toyota 399. Compared with the numbers for 2002 and 2004, there were improvements for every company except two: GM and Ford.