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Transforming the automotive supply chain for the 21st century

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Transforming the automotive supply chain for the 21st century


For the JIT model to work, the quality and supply of raw materials, the production of goods, and the customer demand for them must remain in alignment. If any one of the links in the chain breaks, stalls, or falls out of sync, the impact on the supply chains that crisscross the world can be felt immediately. For companies, unable to deliver on orders in a timely fashion, they risk losing not only efficiency gains but also brand credibility, market share, and revenue.

Now, companies are seeking new ways of managing their supply chains that offer greater flexibility and transparency. In the automotive sector, some companies including Nissan and JIT pioneer Toyota are increasing chip inventory levels, while others including Volkswagen and Tesla are trying to secure their own supplies of rare metals. But technologies, including Internet of Things (IoT), 5G, and business applications are also offering companies new ways to avoid disruption and respond to unforeseen circumstances.

Disruption and transformation

The transformation of the automotive supply chain is taking place in an increasingly-digitized world, beset with environmental concerns. As climate change concerns intensify, and governments across the world compel industries to switch to more environmentally-friendly practices, the automotive industry and its supply chain networks are undergoing a profound shift. Automotive manufacturers are moving away from internal combustion engines and large-scale manufacturing to zero-emission, carbon-neutral electric or autonomous vehicles with a focus on electric or hydrogen as energy sources. Autonomous vehicles, for example, are seen as “servers on wheels” that rely on batteries, wiring, laser technology, and programming rather than combustion engines. Tech giants such as Japan’s Sony and China’s Baidu have also announced plans for their own electric vehicles (EV), fueling an already heated race in the EV market.

According to the International Energy Agency, global sales of electric cars hit 6.6 million in 2021, making up 8.6% of all new car sales: more than double the market share from 2020, and up from a mere 0.01% in 2010. Business insights provider IHS Markit estimates the number of EV models in the US will increase 10 times over, from 26 in 2021 to 276 in 2030. At the same time, charging stations alone will need to increase from 850,000 in 2021 to nearly 12 million in 2030. To meet the increasing need for battery-powered vehicles, manufacturers must establish a new ecosystem of partners that supplies the parts and accessories required for the successful manufacturing and operating of these alternative vehicles. According to research from Transport Intelligence, “the supply chain for the entire powertrain will be transformed and the types of components, the logistics processes employed to move them, the markets of origin and destination as well as the tiered character of automotive supply chains will change.” This has enormous implications for how the automotive supply chain is ordered.

Meanwhile, everything in the automotive sector, from the automobiles themselves to entire factories, is becoming more connected, with the support of technologies such AI, IoT, 5G, and robotics. In recent months, Nissan has unveiled its “Intelligent Factory” initiative in its Tochigi plant in the north of Tokyo, which employs AI, IoT, and robotics to manufacture next-generation vehicles in a zero-emission environment. And Volkswagen has deployed a private 5G wireless network at its headquarter plant in Wolfsburg, Germany, to trial new smart factory use cases.

As manufacturing becomes more digitized, so too does consumer behavior. Automotive brands are rolling out direct-to-consumer sales models, enabling customers to complete more and more of the sales process through digital channels. While new players are taking an online-only approach to the sales model, incumbents are embracing digital initiatives in partnership with dealers where fulfillment, after sales, and services are still provided through a dealer. In 2020, 69% of dealers in the US added at least one digital step to their sales process. And 75% of dealers agreed that they would not be able to survive long term without moving more of the sales process online. Both models require greater visibility into the supply chain to ensure inventory and availability are accurate.

How manufacturers are responding

Ever more connected consumers, factories, automobiles, and supply chains generate a wealth of data. Gathering and analyzing this data can help enable manufacturers to reduce business risk and become more agile by identifying potential supply issues, increasing efficiencies, and giving customers more accurate timelines. Predictive analytics, for example, can help manufacturers answer the “What if?” questions and proactively reduce the impact of potential supply chain disruptions. Digital traceability enables companies to follow products and goods as they move along the value chain, providing them with exact information on the provenance of inputs, supplier sourcing practices, and conversion processes. “On the demand side, customers expect real-time visibility of when an automobile will be delivered to them, and the status of service, spare parts, and accessories,” says Mohammed Rafee Tarafdar, SVP and CTO, Infosys.

In a bid to harness data and develop greater visibility across the business, manufacturers are employing a variety of technology solutions including business applications—suites of software designed to support business functions. Paired with cloud services, the right business applications can give organizations greater access to cutting-edge technologies, which can then be managed at scale and address the need for visibility, analytics, and cybersecurity. As everything becomes more connected and more autonomous, “there is a need to have technology that can scale with demand. This is where cloud and business applications have very important roles to play,” says Tarafdar, who adds that manufacturers are embracing both private and public cloud to create hybrid clouds, with the support of private 5G networks.

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The hunter-gatherer groups at the heart of a microbiome gold rush

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The hunter-gatherer groups at the heart of a microbiome gold rush


The first step to finding out is to catalogue what microbes we might have lost. To get as close to ancient microbiomes as possible, microbiologists have begun studying multiple Indigenous groups. Two have received the most attention: the Yanomami of the Amazon rainforest and the Hadza, in northern Tanzania. 

Researchers have made some startling discoveries already. A study by Sonnenburg and his colleagues, published in July, found that the gut microbiomes of the Hadza appear to include bugs that aren’t seen elsewhere—around 20% of the microbe genomes identified had not been recorded in a global catalogue of over 200,000 such genomes. The researchers found 8.4 million protein families in the guts of the 167 Hadza people they studied. Over half of them had not previously been identified in the human gut.

Plenty of other studies published in the last decade or so have helped build a picture of how the diets and lifestyles of hunter-gatherer societies influence the microbiome, and scientists have speculated on what this means for those living in more industrialized societies. But these revelations have come at a price.

A changing way of life

The Hadza people hunt wild animals and forage for fruit and honey. “We still live the ancient way of life, with arrows and old knives,” says Mangola, who works with the Olanakwe Community Fund to support education and economic projects for the Hadza. Hunters seek out food in the bush, which might include baboons, vervet monkeys, guinea fowl, kudu, porcupines, or dik-dik. Gatherers collect fruits, vegetables, and honey.

Mangola, who has met with multiple scientists over the years and participated in many research projects, has witnessed firsthand the impact of such research on his community. Much of it has been positive. But not all researchers act thoughtfully and ethically, he says, and some have exploited or harmed the community.

One enduring problem, says Mangola, is that scientists have tended to come and study the Hadza without properly explaining their research or their results. They arrive from Europe or the US, accompanied by guides, and collect feces, blood, hair, and other biological samples. Often, the people giving up these samples don’t know what they will be used for, says Mangola. Scientists get their results and publish them without returning to share them. “You tell the world [what you’ve discovered]—why can’t you come back to Tanzania to tell the Hadza?” asks Mangola. “It would bring meaning and excitement to the community,” he says.

Some scientists have talked about the Hadza as if they were living fossils, says Alyssa Crittenden, a nutritional anthropologist and biologist at the University of Nevada in Las Vegas, who has been studying and working with the Hadza for the last two decades.

The Hadza have been described as being “locked in time,” she adds, but characterizations like that don’t reflect reality. She has made many trips to Tanzania and seen for herself how life has changed. Tourists flock to the region. Roads have been built. Charities have helped the Hadza secure land rights. Mangola went abroad for his education: he has a law degree and a master’s from the Indigenous Peoples Law and Policy program at the University of Arizona.

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The Download: a microbiome gold rush, and Eric Schmidt’s election misinformation plan

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The Download: a microbiome gold rush, and Eric Schmidt’s election misinformation plan


Over the last couple of decades, scientists have come to realize just how important the microbes that crawl all over us are to our health. But some believe our microbiomes are in crisis—casualties of an increasingly sanitized way of life. Disturbances in the collections of microbes we host have been associated with a whole host of diseases, ranging from arthritis to Alzheimer’s.

Some might not be completely gone, though. Scientists believe many might still be hiding inside the intestines of people who don’t live in the polluted, processed environment that most of the rest of us share. They’ve been studying the feces of people like the Yanomami, an Indigenous group in the Amazon, who appear to still have some of the microbes that other people have lost. 

But there is a major catch: we don’t know whether those in hunter-gatherer societies really do have “healthier” microbiomes—and if they do, whether the benefits could be shared with others. At the same time, members of the communities being studied are concerned about the risk of what’s called biopiracy—taking natural resources from poorer countries for the benefit of wealthier ones. Read the full story.

—Jessica Hamzelou

Eric Schmidt has a 6-point plan for fighting election misinformation

—by Eric Schmidt, formerly the CEO of Google, and current cofounder of philanthropic initiative Schmidt Futures

The coming year will be one of seismic political shifts. Over 4 billion people will head to the polls in countries including the United States, Taiwan, India, and Indonesia, making 2024 the biggest election year in history.

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Navigating a shifting customer-engagement landscape with generative AI

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Navigating a shifting customer-engagement landscape with generative AI


A strategic imperative

Generative AI’s ability to harness customer data in a highly sophisticated manner means enterprises are accelerating plans to invest in and leverage the technology’s capabilities. In a study titled “The Future of Enterprise Data & AI,” Corinium Intelligence and WNS Triange surveyed 100 global C-suite leaders and decision-makers specializing in AI, analytics, and data. Seventy-six percent of the respondents said that their organizations are already using or planning to use generative AI.

According to McKinsey, while generative AI will affect most business functions, “four of them will likely account for 75% of the total annual value it can deliver.” Among these are marketing and sales and customer operations. Yet, despite the technology’s benefits, many leaders are unsure about the right approach to take and mindful of the risks associated with large investments.

Mapping out a generative AI pathway

One of the first challenges organizations need to overcome is senior leadership alignment. “You need the necessary strategy; you need the ability to have the necessary buy-in of people,” says Ayer. “You need to make sure that you’ve got the right use case and business case for each one of them.” In other words, a clearly defined roadmap and precise business objectives are as crucial as understanding whether a process is amenable to the use of generative AI.

The implementation of a generative AI strategy can take time. According to Ayer, business leaders should maintain a realistic perspective on the duration required for formulating a strategy, conduct necessary training across various teams and functions, and identify the areas of value addition. And for any generative AI deployment to work seamlessly, the right data ecosystems must be in place.

Ayer cites WNS Triange’s collaboration with an insurer to create a claims process by leveraging generative AI. Thanks to the new technology, the insurer can immediately assess the severity of a vehicle’s damage from an accident and make a claims recommendation based on the unstructured data provided by the client. “Because this can be immediately assessed by a surveyor and they can reach a recommendation quickly, this instantly improves the insurer’s ability to satisfy their policyholders and reduce the claims processing time,” Ayer explains.

All that, however, would not be possible without data on past claims history, repair costs, transaction data, and other necessary data sets to extract clear value from generative AI analysis. “Be very clear about data sufficiency. Don’t jump into a program where eventually you realize you don’t have the necessary data,” Ayer says.

The benefits of third-party experience

Enterprises are increasingly aware that they must embrace generative AI, but knowing where to begin is another thing. “You start off wanting to make sure you don’t repeat mistakes other people have made,” says Ayer. An external provider can help organizations avoid those mistakes and leverage best practices and frameworks for testing and defining explainability and benchmarks for return on investment (ROI).

Using pre-built solutions by external partners can expedite time to market and increase a generative AI program’s value. These solutions can harness pre-built industry-specific generative AI platforms to accelerate deployment. “Generative AI programs can be extremely complicated,” Ayer points out. “There are a lot of infrastructure requirements, touch points with customers, and internal regulations. Organizations will also have to consider using pre-built solutions to accelerate speed to value. Third-party service providers bring the expertise of having an integrated approach to all these elements.”

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