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Automotive buyer-supplier relationships are no longer linear. In the transition from ICE to BEV, vehicles are increasingly software-defined, and it’s nearly impossible for OEMs to source every electronic component on their own. Enter the supplier ecosystem.

Following up on her interview with Amazon’s Wendy Bauer, Jan seeks to learn more about the partnership between tech companies and traditional automotive. Chris Thibeault is the partner and ecosystem senior manager at Infineon, and he shares his expertise on the complexity of sales relationships in the semiconductor industry.

It’s a new value chain. Chip manufacturers have to work with third-party partner technologies to meet customer requirements, and automotive leadership requires a new level of confidence and humility to keep the relational web intact.

Wendy Bauer described how she often saw tech companies and OEMs talk past each other. Chris sheds light on how this happens and explains what company leaders must do to bridge the gap. Trust is only the beginning of a healthy working relationship. A thriving ecosystem requires more traits from its leaders.

In a wide-ranging discussion touching on the people who’ve inspired them and the books they’re reading, Jan and Chris take a broad view of innovation, business dynamics and the new style of partnership required for modern vehicle production.

Themes discussed on this episode: 

• Understanding the new supplier ecosystem
• The central importance of the semiconductor industry
• Networking tactics for modern buyer-supplier relationships
• Choosing the right partners to meet customer requirements
• Lessons from Amazon about the power of cloud computing
• How OEMs and tech companies can thrive together
• The leadership qualities required in a successful business partnership

Featured Guest: Chris Thibeault

What he does: Chris is the partner and ecosystem senior manager at Infineon Technologies. His deep experience in sales and product management gives him insight into buyer-supplier relationships. As a semiconductor company, Infineon has redefined partnerships with third-party companies, combining technologies and skill sets to create innovative solutions for customers.

On leadership: “Adding to listening is empathy. Listening is obviously very, very important […] but it’s also the feeling that you are able to connect with the people you're trying to lead.”

Episode Highlights

Timestamped inflection points from the show

[1:02] The supplier ecosystem: Jan recaps her interview with Amazon’s Wendy Bauer, and Chris introduces a new meaning of “partnership” in the world of software and electronics. It’s increasingly difficult for OEMs to source every component on their own.

[3:40] All about that chip: Software-defined vehicles rely on semiconductors. Chris explains how the chip industry has effectively become a Tier 1 and the implications for the wider OEM-supplier landscape. Jan raises a question about the role of purchasing departments in the kind of partnership Chris has described.

[6:14] Defining terms: Chris explains how he thinks about his organization as a collection of ecosystems. He explains the necessity of choosing the right partners and names the specific technologies involved.

[10:00] Caught in the middle: In her interview, Wendy described bridging the gap between OEMs and tech companies like Amazon. Chris explains why this happens.

[11:27] The prisoner’s dilemma: Jan recalls HEVO founder Jeremy McCool’s discussion of consultative selling and nurturing the OEM relationship. Chris relates to Kate Vitasek’s book “Getting to We” and highlights the economic impact of upfront collaboration. 

[14:48] ‘The product is the relationship’: Business partners rarely discuss how they’re going to work together. Jan and Chris talk about the groundwork companies should lay before pulling out the contract.

[17:57] It starts with trust: Chris admires Wendy’s personal leadership style, but he also expands it by naming other qualities that come into play once a partnership is formed.

[19:39] Head in the cloud: How does Infineon drive a culture of innovation? Chris describes what it means to digitize the entire external world — and stay humble while doing it.

[24:10] Advice for auto industry leaders: Chris challenges automotive corporations to think about each piece of the puzzle. No one company can fill every customer need.

[25:10] Closing comments: Chris reveals Infineon’s early mistake that companies should avoid as they look for new partnerships.

Top quotes

[6:35] Chris: “A bee and a flower make honey; it's an interdependent relationship. So, in a sense, that is an ecosystem. We tried to take that analogy into our business and explain to our organization that every application is its own ecosystem and every product is its own ecosystem with its own needs that it has to take to market from a partner perspective.”

[15:07] Jan: “The product is transforming in a way where we now need partner ecosystems. Therefore, the relationships and the leadership model and the culture needs to change along with that. And that's the bit that I think we're missing.”

[22:22] Chris: “Feeling safe to raise your voice in a meeting is an extremely important aspect of innovation. If you're in a cutthroat type of culture, you're not going to collect all of the data in order for a leader to make decisions.”

[24:32] Chris: “Each company is going to provide a piece of the puzzle. From a system aspect and what your customers need, what is it that you do not have? This is, by definition, a need, and then you can translate that into a partner need.”

[Transcript]

Welcome to the automotive leaders podcast, where we help you prepare for the future by sharing stories, insights and skills from leading voices in the automotive world with a mission to transform this industry together. I'm your host, Jan Griffiths, that passionate, rebellious farmer's daughter from Wales, with over 35 years of experience in our beloved auto industry, and a commitment to empowering fellow leaders to be their best authentic selves. Stay true to yourself, be you and lead with Gravitas, the hallmark of authentic leadership. Let's dive in.

Hello, and welcome to another episode of the automotive leaders podcast. And today, we are going to deconstruct the episode with Wendy Bauer from Amazon. And for those of you who listen to that episode, you'll know that we got right into the idea of the supplier ecosystem and what's happening in the world of software and electronics around the vehicle. The traditional buyer supplier relationship is changing. And I wanted to go deeper into that as well as talk about Wendy and her leadership style. And I couldn't think of a better person to get into the weeds a little bit more on the supplier ecosystem than Chris Thibeault. Chris is with Infineon a global semiconductor company, who is certainly at the forefront of electronics and what's happening in this part of the industry in automotive. Chris, welcome to the show.

Thank you very much and very happy to be here, Jan. Thank you for the invitation.

Great, Chris, tell us about your role at Infineon. It's fascinating. It is not a traditional buyer-supplier type relationship. share with the audience, please what you're all about at Infineon.

Thank you very much. The role that I fulfill is literally called partner and ecosystem management. And so as you rightly said, you know, there are still those traditional supplier-customer relationships. But at the same time, we've had to define what we mean by partners. And partners are those third-party companies that also sell to our customers that we can combine our technologies with to solve a bigger pain point, and together win with our customers or our partners.

So, let me try to understand this, Chris. So, I got a little bit of this from Wendy's interview, right? There are so many different players in this world of software and electronics. It's very difficult for an OEM to source every individual little piece on their own, because they all have to somehow play together and integrate together. I mean, it's a very simple way of stating it. Did I say that properly?

You stated it very clearly. It's all about ease of use. And so the easier that we can, as an industry already makes the technology easier to adopt for our customers, the better we're all going to play together nicely.

But I would think the semiconductor seems to be such a small part of it. But yet, you seem to have such a lead role in this. Oh, what's that all about?

Well, I think the semiconductor industry is faced with, like you said, the changing landscape of the relationships between the OEMs and the suppliers. The EMSs are becoming tier ones, some of the tier ones are thinking becoming EMSs and so on. And at the same time the software defined vehicle is changing the value chain. So, I think the semiconductor industry is now finding itself at the forefront of that and becoming a tier one itself in a sense by being able to bring the power of our partners technologies together with our own to help define those systems in concert with our customers’ requirements.

Because the industry certainly learned the hard way, didn't it about underestimating what semiconductors were all about. They were looking at this small, seemingly low value part. They were looking at the purchase price only of this small part, and it got us into a whole world of trouble.

Certainly did. I very much look forward to playing a part in enhancing the way that we go to market with our partners. I found this role to be an extremely exciting area to focus on and I kind of leaned into it for my career and joined Infineon to help transform the way that the organization thinks about systems and bringing partners to bear along with their own chips.

So, as an ex-purchasing person, if I was in purchasing in Infineon and here comes this guy, Chris Thibeault, says he's responsible for partner ecosystems, I might feel like you're treading on my turf there a little bit, Chris. How does that work? How do you integrate with purchasing?

That's a very good question. We have a large sales team who's responsible for our customers and our account teams. I mainly work with our marketing teams to make sure that they have a full definition of what the ecosystem is around their applications, and around the product. So, it's really that relationship that is key to enhancing the culture within the organization to bring to bear the power of our partner network. And then once that step is done, then we can really move forward and enhance the relationships directly with our customers with the full power of our partner network behind us.

Okay, all right. So, it's very much you're very much involved with the marketing side of the business.

Yes. And in fact, I am in a marketing role at Infineon.

Tell me, this word "ecosystem". We've talked about it before. And it can mean a million different things to different people. Define ecosystem, please.

This was one of the hardest things to overcome. And it's not only the definition of what an ecosystem is, but it's really also the definition of what a partner is. We tried to even use the analogy of the ecology, if you will, because that in itself is what an ecosystem is. So, a bee and a flower make honey, it's an interdependent relationship. So, in a sense, that is a, an ecosystem. And so, we tried to take that analogy into our business, and explain to our organization that it every application is its own ecosystem. And then every product is its own ecosystem with its own needs, that it has to take to market with from a partner perspective. And so, it's our application managers and our product managers whose initial role it would be to define what those partner needs are, and then identify which partners are going to be the most successful within when we go to market to our customers. So, we had to start with defining what is our ecosystems, which is our applications and our products.

And what kinds of companies are you partnering with? I mean, what type of technologies have to come together for this to all work seamlessly in a vehicle?

We categorize them into four different areas. And you certainly say there's room for more, but services, tools, hardware, and software. And so, the partners are all of those third-party companies that sell to our customers who are not our competitors. So, we try to work with the partners that fulfill a certain need under those categories.

What are the types of technologies that are involved? What kinds of companies do you partner with to provide this ecosystem for the vehicle?

So, if we just dive into one ecosystem, battery management systems, for example. So, there can be any number of different partners that go along with that. And the cloud partners are certainly one of them, we categorize them as a service partner, they're providing a service in order to take the data from the vehicle and perform a function to that sending the result back down to the vehicle. So certainly, Amazon AWS is a big part of that there's other cloud providers, of course, that is an example of a service provider. But we also work with other software vendors. There’re software vendors out there that provide other pieces of the application puzzle, for example, that determines the state of health of the battery, or the state of charge of the battery. There's companies that really focus on that aspect of the system, from a software point of view. And so, we partner with them to go to market together to position our chips and their software together to solve a larger need at the customer.

Yes, it sounds like you really trying to take the pain point away from the customer from the OEM have the responsibility of having to source and manage all of these parts individually. It sounds like on some level, maybe they can't you have to work together, right?

The tier ones have and that was one of the major functions that they did serve. The customer's tastes are changing or what I'm trying to position within Infineon is that the customers have changed. This is already past the inflection point. So, the OEMs now are defining the systems and the semiconductor companies and others find themselves in the position of helping them define those systems and bringing to bear the power of our partner networks. And so, all of the partners are now virally going in this direction.

That's very interesting. Now, Wendy said in her interview, and this is something that that has stuck with me, she said that the traditional auto, so mostly the OEMs. And the world of technology, because Amazon is a tech company. So, she said they talk past each other, and she finds herself in this role of having to bridge that gap. Do you find yourself in that role?

From a partner and ecosystem standpoint? I do. Yes. So, this particular concept, and discipline is something that's still fairly new, I think, to the automotive industry. And it's even starting to become its own industry, where there's third party tooling that will share opportunity data with each other. And so it's really starting to become a budding industry on its own. But at the same time, you know, the position that Wendy finds herself in, I think the same conversation goes on between the semiconductor companies, and the cloud providers, because they're very much separated by technology. The system makers are in the middle. So, they're taking the semiconductors and connecting to the cloud. Whereas how do you make these demonstrators work with semiconductors and cloud providers. We need other third parties also to help make that happen. And so, we also partner with system makers and other third parties that help us bridge the gap,

The type of relationship that you have with the OEM. One of the things that we talked about with Wendy was the fact that the style has changed quite a bit, come on, needs to change coming out of the OEMs. And I'll also refer back to the interview that I just did recently with Jeremy McCool, the CEO of HEVO, the EV wireless charging company. And he said that, really, the OEMs have to change to a more and I'll use his term, a more coaching, nurturing, and it's more of a consultative selling kind of approach, which is vastly different to the more aggressive command and control kind of tactics that we see coming out of the OEMs in the past. And I know that you have done a lot of research behind supplier relationships and what you need to make the supplier ecosystem and partner ecosystem work. Tell me a little bit about some of the work that the research that you did. I know that you read Kate Vitasek's book, Getting to We. Share with the audience, if you will, a little bit about what you learned from that book, and how you see the supplier relationships between the OEMs and the supply base changing.

That was one of the most fascinating books that I've read recently, and someone very wise tipped me off to this author and book. So, thank you very much, Jan. The premise of this book is developing highly collaborative relationships. And so, as I was reading it, I was just very much soaking it up because it plays right into partners and ecosystems. The analogy that Kate uses in her book, right off the bat, is quite interesting. It's called the prisoner's dilemma. The prisoner's dilemma is basically two criminals committed a crime, they were caught, and they're in the police station, and now they're separated. And so, the police are interrogating them, and they're basically enticing one to tell on the other. And so, the scenario is you have a, you know, a four-by-four matrix, you know, where they either both defect and tell on each other one does it or the other doesn't, or none of them do it, right. And the consequences are such that if one tells on the other, then the other goes away for a very long time. And the other one that defected probably gets a very light sentence, you know, vice versa in the other direction, but if they tell on each other, will they both go away for a long time. And then if they just stay silent and collaborate, well, they're off, right? Or they both get very light sentences. So, this is the prisoner's dilemma. The analogy to business is that if you go into business together with your partners or with your customers, supplier customer relationships, you know, fall right into play here as well. If you decide to collaborate right up front, either pie grows bigger for both parties and for all parties. So, the economic impact based on trust and collaboration is much higher than trying to go it alone.

Yeah, I love Kate's work because I think she's at the forefront of designing the contract that then needs to define the relationship. It is something to really think about. I think that in the automotive industry today we just keep going along, thinking that the way that we've always done things is going to be just fine even in this new world and transformation. From ICE to BEV, but it is not the product is transforming. Here's a classic example of how the product is transforming in a way where we now need partner ecosystems. Therefore, relationships, leadership models and the culture needs to change along with that. And that's the bit that I think we're missing. And that's why I love having you on the show, because you represent an example of that relationship changing.

Yes, Kate describes what you just said, also in great detail, the product is the relationship. And in fact, if you define the relationship upfront, you agree to collaborate under every condition, and you don't defect and stick up for your own interests, then, again, the pie grows for both partners. The relationship is defined by principles that start with trust, and then it even breaks that down into different aspects. And it's a very interesting read.

Do you think that that will influence the way that you do business with your partners?

I have actually asked some of my partners to read the book.

Wow, that's an endorsement.

And they've agreed to do it.

But I think that the fact that you even had the conversation about how you're going to do business together put you lightyears ahead of many companies, because so often, we don't have that conversation. How are we going to do business together, what happens when something goes wrong, instead of going to the boiler plate and whipping out the contract and going, I'm going to beat you with this until I you know, I pull every blast, drop of blood and life out of you? Right? Instead of doing that, it's having the conversation upfront, setting the groundwork, setting the guidelines for the relationship, and saying, this is how we're going to operate. This is what happens when there's a problem because there will be problems, there will be pricing issues, there will be commodity increases, there will be labor problems, and there will be quality issues. And there will be end customer issues that you both have to deal with. But it's not going to be a magical relationship. And it's all sweetness and light, that doesn't work that way. But what can change is how you approach these problems. And if you come at it with more of a coaching, nurturing, let's get through this together, instead of I'm gonna beat you, then that's a very different approach.

The traditional approach to negotiations starts with terms and conditions. And it's all about protectionism. It's what's in it for “me”. And the book also talks about that, and it transitions that to what's in it for “we”.

I like that. Well, I think we started something here, Chris. I think this is the first of several podcasts that will have focusing on exactly how the buyer supplier relationship is changing. And people who can contribute to that conversation. Chris, from the interview with Wendy, let's talk about her specifically her individual leadership style, what resonated with you from that interview about her style?

Well, having a link in this book to when the provided in terms of her leadership style she started off with describing trust is the number one principle. And that is, of course, the number one principle for establishing any relationship is trust. So, from a leadership perspective, I have to agree with that. I also think it's about authenticity and accuracy. As a leader, just to you know, dive a little bit deeper. From a leadership perspective, it's also about confidence. I think, if you want to lead, confidence is really one of the most important things for your followers to buy into if you want to be a leader.

There's a bit of a fine line there between confidence. Being confident, I agree, is a very important leadership quality, but also this ability to show vulnerability.

Yes, I believe empathy is the second principle that I would have added to Wendy's leadership style. So it starts with trust than some of the sub aspects of that authenticity, accuracy, and you need the confidence to lead into that. But also adding to her listening is empathy. So listening is obviously very, very important. It's critical and essential. What is the feeling also behind that you are able to connect with the people you're trying to lead as well.

I would agree. Wendy talks a lot about innovation. We know Amazon to be an extremely innovative company, and so is Infineon. And there's a lot going on at Infineon to make sure that the culture is right and the environment is set so that innovation can flourish. Tell us a little bit about what you thought from the interview with Wendy about her comments on innovation. But perhaps more importantly, how you see the culture of innovation from your own perspective and your own experience.

Infineon has a very strong culture. One year into Infineon, I'm still very enthused to be here. It starts with our leadership. Our CEO has to two models if you will, decarbonization and digitalization. So that very much connects with Wendy in terms of her service, which is providing data and cloud providers to the automotive industry. Another model of Infineon that I find very interesting, I really enjoy it is that Infineon is positioning itself to be the link between the real and the digital world. As a semiconductor company, we have the technology to sense the outside world, convert that into a digital signal, voltage and current, and then send that data up to the cloud. And so being the link between the real and digital world, basically, we're digitizing the entire external world.

That's fascinating. Now, what sort of culture you've worked for some more traditional companies, as well, Chris, but what's so unique about the culture at Infineon that allows this type of innovative thinking to flourish?

Another book that I read that I really enjoyed, also research based, was called Good to Great. I think it starts with leadership. The research, you know, took into account many different successful leaders, but took the most successful leaders and tried to ascertain, well, what was so common about these 15 companies that they ended up evaluating. And it gets back to confidence, but one of them was passion, the passion that the leaders bring to their companies, and then also being humble. It's about humble, passionate leadership.

Yeah. And what about safety, the trust and the safety, you have to have an environment where you feel safe to come forward with new ideas, otherwise, you'll just bottle them up? How does that work culturally at Infineon?

I believe that conflict management is essential for any company. So being feeling safe to raise your voice in a meeting is an extremely important aspect of innovation. And if you're in a cutthroat type of culture, you're not going to collect all of the data in order for a leader to make decisions. So, conflict management is something that's very important. And I think Infineon has a very strong culture that allows other opinions to be heard, even if it's contrary to what's going on in the in the room.

Yeah, that's, that's very encouraging to hear, because I believe that the more traditional automotive companies have to adopt that type of culture in order to get the innovation and to operate at speed. And we know that Amazon knows all about speed. Part of me says that it's a little easier for Infineon to do this because they're a technology company with a division in automotive. They're not an automotive company trying to embrace technology. I think somehow that their roots and their background sets them up to be in a better position to embrace a new way of thinking and transforming culture. Do you think there's any truth to that?

Well, so Infineon is about half of our businesses in automotive. So, it's the largest semiconductor company in automotive very much steeped in traditional automotive mentalities and methodologies. But we also supply to the consumer industry in the tech industry. And so there is a feeling of adoption from new ideas and technological advances and innovation. So, the leaders do listen, and they do drive from the top down and listen from the bottom up. And it's a great culture to be in. It really is.

Chris, what's your advice for companies out there who are embarking upon this idea of developing a partner ecosystem? Give me some things, what should they really start to think about?

How I've thought about it, and I think how corporations should be thinking about this is from a system point of view. So, each company is going to provide a piece of the puzzle. And so, from a system aspect and what your customers need, what is it that you do not have? And so, this is by definition, a need and then you can translate that into a partner’s need and then that will help you to go identify then well, which type of companies or which partners can fulfill that need. So, it starts with really thinking about the system and the pain point that you're trying to solve, and then expanding that out to what your end customers ultimate goals are.

And give me one lesson learned something that you learned the hard way that they should definitely not do.

The transformation that we're going about at Infineon is to rather than just going out and establishing a whole bunch of relationships with the first thing we're trying to do is establish a process and a framework and a methodology to measure our performance and so on. And clearly articulate what we want from our partners before we go out and, and actually ask for partnerships.

So don't go out there without doing don't go out there and talking to partners until you get all the processes in line, right. Well, thank you, Chris. It is clear that supplier partnership ecosystems are definitely in our future. And thank you for sharing your knowledge and insights with us today.

Yeah, I really appreciate the invitation. Jan, it's been a pleasure. Thank you very much.

Thank you for listening to the automotive leaders podcast. Click the Listen link in the show notes to subscribe for free on your platform of choice. And don't forget to download the 21 traits of authentic leadership PDF by clicking on the link below. And remember, stay true to yourself, be you and lead with Gravitas, the hallmark of authentic leadership