In the manufacturing industry, original equipment manufacturers (OEM) are the central focus of any analysis. OEMs deal with partner management for various purposes. For procurement, they interact with strategic and transactional suppliers. For manufacturing, they interact with a contract manufacturer. For logistics, OEMs interact with 3PL and 4PL. For planning, interaction takes place with all sorts of partners. OEMs also interact with all sorts of service providers such as ISV, consulting partners, etc. These interactions are based on a symbiotic approach where OEM and partner both get benefited.
In the new paradigm, partners and OEMs form a network and interact with each other. The fundamental difference between the traditional and the new paradigm is that the partners interact among themselves and with the OEMs now, while earlier, each partner used to interact with OEM alone. In the new approach, all of them use a common digital platform for mutual interaction to share selected pieces of information and transactions.
The visible trend is ‘product to services’ where services form the major activities among partners along with the traditional product-based relationship. Partners connected through the digital platform are not only doing transactions for products and services but also collectively working for a higher level of collaboration and co-creation jointly to create a bigger ecosystem. This network is enriched when the partner’s partner, i.e., level two partners and a few facilitating agencies, also join the network to create a bigger ecosystem. This ecosystem encourages co-creation and innovation and helps the OEM get an edge over its competitors.
We believe that in the new world, interactions should not be on one to one basis. Instead, the interactions should be network-based. All partners should interact with each other, and OEMs should be the central focus point. This would create an ecosystem of partners that would foster higher levels of collaboration and co-creation. Thus, efficiency would increase to benefit both OEM and partners.
This will unleash and unlock the potential of partners in the ecosystem to create new value pools. The result will reflect directly in KPIs such as perfect order rate, cash to cash cycle time, inventory turn, and forecast accuracy, etc. and measurable benefits can be calculated for the OEM and other partners in the ecosystem.
A digital platform enabled the ecosystem of partners, where interaction takes place in multiple ways, and value creation is done through collaboration and co-creation is the ideal means to foster a relationship. The positive impact generated by such a partner ecosystem leads to higher KPI values and results in higher dollar value generation and saving. HCL has developed its time-tested framework for partner ecosystem assessment, building, and management.