Capgemini Worldwide

The challenge of innovation: transitioning to a new automotive reality

A transition that is seeing traditional ways of acting and thinking merge into a world of more dynamic and fluid interactions, inspired by the constantly evolving demands of consumers, governments, and regulators.

As with any change of this magnitude, innovation has a vital role to play.

In fact, ingenuity has a lot of hard lifting to accomplish as it empowers the shift from mass production mindsets to services-centric models. Where legacy systems and constraints give way to new approaches, and the rapid ideation enabled by software-driven transformation. Change that brings with it 3 broad challenges:

Let’s quickly assess each of these in turn.

Challenge #1: moving to a service-oriented culture

The innovation remit in automotive is certainly broad. That’s because there is a lot to factor in, with new usage and ownership models demanding attention, alongside the all-consuming concept of sustainable mobility. Innovation therefore needs to be inclusive and extend from first design concepts to methods for end-of-life recycling, thereby helping the OEM:

Delivering against these ambitions takes OEMs into the realm of end-to-end service provision. An environment of always-on connectivity and universal data flows that moves them beyond ‘fabricate and forget’ products, to cars as ‘service platforms’ – constantly adjusting to meet the needs of drivers and passengers.

Challenge #2 building up the competencies to succeed

One of the biggest tasks faced by OEMs today is to maintain the skills needed to thrive in a software-defined marketplace. To move beyond the traditional focus on cost and quality, toward an operating environment where engineering blends effortlessly with IT to create unified and seamless outputs.

That can of course be easier said then done. Building up the required technological competence involves more than opening up a new department.  Instead, fundamental change is called for to support:

In response, leading OEMs have been quick to act. Taking inspiration from other industries to adapt procedures, while also spinning off parts of their business to create centers of software excellence – or acquiring specialist consultancies.

Whether these are short-term measures designed to buy time for OEMs as they strengthen their own in-house training, or whether such trends continue we wait to see. But one things is certain: skills availability is proving a key differentiator – and a core enabler of future innovative prowess.

Challenge #3 enabling the transition

Legacy skill sets are not the only barrier to accelerated innovation. Legacy production processes also present sizeable obstacles, as they ensure software integration is relegated to a minor, final step prior to a vehicle’s completion.

Innovating at speed however means ensuring software acts as a key enabler throughout this end-to-end production phase, both inspiring and informing it. The end goal being a more flexible and modular approach that helps realize the full potential promised by Intelligent Industry, alongside the twin advantages of standardization and customization:

In summary

Sustaining and accelerating innovation in automotive is an endeavor that impacts every facet of an OEM’s end-to-end operation. The need to enable new service models while maintaining the necessary skill sets, are challenges that few organizations in the industry were ever fully prepared for. Yet overcoming them is a must for any OEM hoping to remain relevant.

Progress however can be surprisingly swift. Especially when based on a clear vision and backed up by the skills, methodologies, and production capabilities needed to succeed. To help inform this conversation, Capgemini has created its TechnoVision for Automotive 2022. A guide that details how end-to-end thinking leads to end-to-end innovation, while always ensuring that the customer sits at the heart of every transformation initiative.

To access your copy, click here.


Alexandre Audoin

Group Industry Leader for Automotive at Capgemini

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