The automotive industry’s IMDS reporting process for documenting global regulatory compliance is based upon the premise that an entire multi-trillion-dollar industry can successfully share common tools, processes and approaches to provide mutual benefit for all industry stakeholders. It is an immense effort and doesn’t happen without full engagement up and down the supply chain. This article discusses three ways that its large user community is now creating its own tools, and rapidly changing the face of the reporting landscape.
Is the Scale of IMDS Reporting a Blessing or a Curse?
With all its complex moving parts, the entire IMDS reporting mechanism doesn’t always operate as a well-oiled machine. The challenges of communicating and enforcing requirements through multi-tier supply chains is one notorious proof of this. However, there is another perspective that can be adopted regarding the massive scale of the IMDS reporting endeavor; and that is the viewpoint of recognizing the hidden potential for crowd-sourcing solutions to common IMDS reporting challenges.
The IMDS user community constitutes a decentralized workforce of tens of thousands of subject matter experts who have encountered every conceivable data reporting challenge over the course of the two decades that IMDS has been in operation. This user community finds itself closely orbited by an array of service providers eager to offer them support with IMDS reporting efforts, including: software vendors, consultants, trainers, program managers, systems integrators, and industry organizations.
Three Grassroots Campaigns Taking Root
There has recently been a groundswell within the IMDS user community to crowd-source niche solutions for boosting the efficiency of IMDS reporting processes for the everyday IMDS user. One example is the upcoming April 17th IMDS Workshop. That event’s agenda (below) was essentially crowd-sourced directly from input provided by everyday users battling on the IMDS front lines. The content is based on users’ intimate knowledge of their own practical needs. Another example is a 2018 multi-stakeholder survey which mapped out the 24 most frequently recurring IMDS errors and is being used to streamline IMDS reporting throughout the supply chain.
Figure One – Workshop using a Crowd-sourced Agenda
Below are three other examples of emerging “Open Source” initiatives being driven from the bottom-up by stakeholders at every level of the supply chain. These efforts are perhaps not well-known yet as they haven’t been subjected to the marketing hype which invariably accompanies more customary approaches. Nevertheless, some of these initiatives are likely to very soon lead to disruptions (in the positive sense of that word) in the IMDS reporting space
1. IMDS Training Video Tutorials
There have been IMDS classroom and web-based training options available since at least 2001 in most parts of the world. There will always be a demand for full-fledged trainings as new staff cycle into IMDS roles and as new requirements emerge. However, a rapidly emerging trend is the use of modular videos to address very specific technical issues. Very focused, practical, user-generated videos of 5-15 minutes duration in all sorts of languages are aimed at quickly walking viewers toward a solution that may have otherwise taken hours of trial and error to discover.
As an analogy, there is almost no household appliance that you can’t fix now after a 15 minute investment of time in watching a Youtube video. Perhaps this is not good for demand in the handyman industry. But overall it is a huge net benefit for homeowners.
Figure Two – Modular IMDS Tutorials are widely proliferating, but hard to locate
Similarly, the tens of thousands of IMDS subject matter experts in the user community are beginning to provide niche problem-solving content that barely existed as recently as two years ago. Conduct a Youtube or Vimeo search using the right keywords, and you will see them. The main challenge, however, is that the decentralized and uncoordinated nature of these approaches currently makes it quite difficult to find what you are looking for.
Tetra Tech is indexing this content and will be facilitating access to a centralized repository of IMDS training video tutorials within the next month. User-generated content is growing so rapidly that it is a challenge to find and organize it all, but as in the household appliance repair space, a lot of benefits will be realized once answers are just a couple mouse clicks away.
2. IMDS Data Collection and Reporting Templates
IMDS is funded by the major automakers as a free tool for the use of its supply chain. Suppliers just have to provide the labor to get material content data into IMDS. Many of the larger Tier 1 suppliers have supplemented the free IMDS software with investments in third party commercial applications designed to ease much of the heavy lifting involved in moving data from internal systems into the IMDS central repository.
However, there has always been a large gap in software resources for entities from the second tier on down. These Small-to-Medium-Enterprises (SMEs) are resource-constrained and generally cannot participate in the material content reporting software marketplace. Throughout the years, various software vendors have sought to craft and market workable, lightweight, affordable solutions that would capture that SME market segment which includes tens of thousands of prospective customers. But the numbers have never really worked out for the vendors or for the prospective customers. If you recall Economics 101 class, picture in your mind the graph where the Supply and Demand curves fail to intersect, and where everybody loses.
The failure to create a market for affordable tools for the SME segment means most data goes into IMDS the old-fashioned way – manual data entry. For the automotive industry as a whole, this imposes large labor costs and contributes to delays in reporting and poor data quality.
Recently, the middle levels of the supply chain have stopped waiting for the day when “they” will swoop in and rescue suppliers from these problems and have taken matters into their own hands. They have finally realized that “There is no They”. A few examples of the types of tools being developed are illustrated below.
Figures Three, Four and Five – Open-Source Templates: Good news for SMEs
It is possible that some of the emerging templates may prove mildly disruptive in the material content reporting space for some software vendors, but since the SME market segment is currently virtually nonexistent this will probably not be a significant threat for these solution providers.
3. Automotive Industry Global Regulatory Tracking
There are at least two dozen commercially available global regulatory tracking platforms on the market, a few provide some level of ability to filter results for automotive industry-specificity. However, some simple math will demonstrate why there is no commercially feasible solution for the entire industry to use in a truly comprehensive manner.
The IMDS Basic Substance List contains approximately 13,000 substances. Automobiles and automobile components are sold and/or manufactured in 195 countries. The concept of Producer Responsibility (a less ominous-sounding euphemism for Producer Liability) means that if your vehicles contain all of these substances and you (or your customers/downstream users) sell worldwide you have direct or indirect responsibility for at least (13,000) x (195) = 2.535 Million combinations of Substances/Jurisdictions.
Oh, I forgot to mention that many of those countries have internal regional jurisdictions with separate regulatory regimes. And that the restricted substance lists change periodically for each jurisdiction.
Several organizations have tried to tackle this problem only to see their valiant efforts collapse due to prohibitive costs, and due to organizational inertia dragging progress out for literally years. But what if you had an army of volunteers with responsibility for their own corners of the world? For example, if you lived in California; or in the Basque provinces; or in Guangdong, and were responsible for understanding only the chemical regulations which pertained to automobile manufacturing/importing within your local region, would that not be a manageable task? If your job title contains the word “Environmental” might that minimal level of vigilance perhaps even be considered a basic pre-requisite for you to merit drawing a paycheck?
Okay, so are there 194 other people in the world like you with properly functioning regulatory antennae? Are you and those 194 others opposed to sharing publicly-available information which you are already routinely gathering as part of your day job? Do you see where this is going now? Hint: several well-known 100,000+-member organizations have taken on this challenge for the automotive industry. 100,000 is a lot more than 195.
Caveats and Conclusion
These examples provide a glimpse of the power of crowd-sourcing when there exists a user community with sufficient scale and expertise. There are of course important considerations to keep in mind. In the real world, incentives matter. The vast majority of solutions to business problems are driven by old-school business motivations.
Market Share. Earnings. Intellectual Property. Raises. Bonuses. Stock Options.
This is not going to change. Altruism is a wonderful thing, but I would still advise placing the majority of your bets on enlightened self-interest, at least in economic matters.
Decentralization offers flexibility for rapid problem solving. Without the need to spend hours in committee meetings, the above-mentioned tools and solutions are being developed at a much faster pace than more customary methods would allow for.
But there is a need for coordination and quality control. Not a week goes by that I don’t hear someone qualify some fact with the caveat “..now my source is Wikipedia, so…..” Which tells me two things. One – you really do need to take some information with a grain of salt; and Two – people are consulting Wikipedia in their daily work with incredible frequency, so obviously it is providing significant value for them.
Perhaps most people do the mental calculation and figure that if a free, convenient resource saves them an hour of their time and is 95% accurate, that tradeoff will suffice for most purposes. If, and when, an actual decision needs to be made, they will then proceed to invest the time and/or money in consulting more authoritative sources. Perfection in this world being relatively rare, this is not a bad approach.
Let’s go back to consider the original premises of the whole IMDS reporting strategy. Crowdsourcing was not really a “thing” in the 1990s when the founders of the IMDS concept met to lay the foundation for what we have today. But clearly these leaders had a vision of what was going to be required in order to generate the many millions of disclosures that have occurred since then. Time has validated the clarity of their vision. Just compare the automotive industry’s level of material content disclosure documentation relative to some other industries. Today’s technology now presents the opportunity to expand upon that progress and take that vision to the next logical level.
Stay tuned: More detailed information, weblinks and calls to action for each of the above three emerging efforts will be provided in upcoming articles.