Collaborative Economy: the Blue Ocean of Manufacturing?

We see a lot, everywhere, of articles about the future of manufacturing: brace yourself!  Disruption is here!  In this instance, for many, it is not the second coming but the fourth one.  And it is true that new technologies and capabilities are transforming the landscape of the manufacturing sector.  In very simple terms, 3D Printing and e-Commerce have created this Maker’s Movement in which anyone can become a freelance manufacturer with a global customer base.  And with technologies like internet of things, drones, robotics, and virtual reality, it’s an exciting time to be in manufacturing.

But there’s one area I wanted to explore, that is not a technology but rather a growing social phenomenon: the Sharing Economy.  The business model relies on creating a platform that allows consumers to share and create physical goods and services; this in turn ends up directly competing with more traditional industries like Airbnb with hotels and Uber with taxis.  And as we’ve seen with Uber this past July in France, traditional industries are not always ready to welcome this new form of competition.  However, in a world where 64.93% of manufacturers claim that globalization is the macro-trend having the most impact on their business (Copperberg Research: Internet of Things in the Manufacturing Industry 2015), how can this Collaborative Economy transpose itself to a more b2b environment, and what kind of impact can it have on business models and the sector as a whole?

The internet has opened up the world, and it is no longer sustainable to compete on a small, local scale (except perhaps in very niched markets).  However, building a business that can gain, retain, serve, and service customers all over the globe can be costly in terms of workforce, owned-assets, and logistics capabilities, among other things.  And, especially for SME’s that maybe don’t have the capital to rely on M&A’s to build themselves a local presence in remote location, isn’t a collaborative economy an ideal business model to diversify a company’s global presence?  Not as a replacement of traditional ways of doing things, but surely it could be an idyllic supplement.

One area that a Collaborative Economy could bring great value to is service technicians.  And in fact, to some degree, this business model already exists (FieldNation, for example) but on a limited scale geographically.  Imagine a platform connecting a company’s service division with a vast amount of freelance technicians scattered over the globe.  For SME’s, this would be the ideal model to be able to directly service customers onsite, no matter the customer’s location (on the basis, of course, that there are freelance technicians in that region).  For large enterprises, this would also be a relief on their own and costly workforce, which could then be repurposed to take care of technically-challenging jobs and large accounts, while in conjunction using a platform of freelance technicians for simpler jobs or perhaps those very remotely located.  Managing the integration of your own workforce scheduling with those of the freelancers might be a technological challenge at first, but surely not insurmountable.  And the potential cost savings in labor might be great.  It would also create a more diversified and agile workforce.

There are other sectors where a Sharing Economy could potentially work, such as logistics, for example.  A model closely similar to Uber, with freelance truck or van drivers, could be quite useful for last minute deliveries to ensure SLA’s.  And in a world of GPS tracking and NFC tags, the technology is already there to ensure its feasibility.  Perhaps there could be models of shared fleets, or warehouses.  The possibilities, if not endless, are many.  Of course, as with any new business model, a few things would need to be considered and figured out, such as competitive remuneration and security.  But the potential is certainly there.

What do you think?  Is a Collaborative Economy something feasible in a b2b environment?  Do you know of any cases where it already exists, successfully (or unsuccessfully)?  What are your thoughts?  Continue the conversation on my LinkedIn post or on Twitter (#CEManufacturing)

Thomas Igou
Content Director