What Direction is the Automotive Industry Headed?
The industry is once again at an inflection point, but this differs from prior crossroads. Previously, the driving factor for change came from the business itself. Expansion to new markets, optimization of global footprints, and sustainable operations caused automotive companies to develop new strategies, products and services, and skills to succeed. The fundamental single ownership business model stayed the same.
Now, digital technologies and consumer expectations are having a profound impact on all aspects of the business. Even the core business model, one that has sustained the industry for over a century, is under attack. To add to the confusion, an industry that was once closed to others is now open to any entrepreneurial venture that can provide a mobility experience of value to consumers.
Automotive companies have a decision to make. They can seize the opportunity to reinvent their organizations through digital technology—unleashing new experiences, new focus, new ways to work, and new workforce skills. Or they can continue down their current path, running down the clock and risking obsolescence. We recommend executives take the following actions:
Create loyal customers with personalized experiences that “stick.”
- Align digital vehicle profiles with consumer digital profiles to deliver consistency and cross-brand stickiness.
- Use cognitive capabilities to combine personal information with vehicle usage and environmental information to learn, predict, and optimize the consumer experience.
- Integrate with other aspects of the consumer’s life to create a brand experience that transcends beyond the vehicle.
- Instill a sense of consumer confidence and trust through unparalleled data security and privacy.
Innovate don’t isolate – build platforms to promote purposeful collaboration.
- Identify what is strategically core to the business. But also embrace collaboration by crafting a value proposition for platform-derived ecosystems.
- Leverage deep expertise, open workflows, and data synergies to seize the expansion potential within that ecosystem.
- Create “fast and frictionless” entry points for platform participants so they can quickly add value.
Get agile and change fast.
- Implement design thinking, co-creating, and agile processes, together with the customer, for rapid idea creation and testing.
- Define and test specific minimum viable products (MVPs). Conduct rapid proofs of value (POVs) using an agile approach. Select successful POVs and scale to the enterprise.
- Use automated processes and self-learning, self-correcting workflows to deepen customer relationships and change the nature of work for employees.
Exploit and share data.
- Continuously uncover new data sources from all facets of the business, the vehicles, mobility services, and customers to gain new insights and opportunities.
- Use AI technologies to curate and enrich data that “thinks” and “acts” to meet specific business needs. Remember, one view of the data does not fit all.
- Relentlessly share data and insights within your enterprise and across your ecosystem to co-create new business models and revenue streams.
Boost brainpower and skillsets with AI-driven educational ecosystems.
- Implement skills identification initiatives to uncover new expertise requirements.
- Create a learning platform ecosystem to allow all types of content, functions, and multiple parties to connect and interact. Add content to the learning platform at speed and scale, and dynamically personalize learning for every employee.
- Reimagine the learning function powered by AI. Use artificial intelligence to create human intelligence.
- Discover insights in your data to predict the critical skills of your business and drive new content creation.
Are you ready for the digital automotive future?
- How will you provide exceptional, personalized in-vehicle experiences that create brand loyalty in an autonomous, mobility-as-a-service environment?
- By what metrics will you determine your organization’s desired platform participation level—participant, owner, or both? How will you set expectations accordingly?
- How can you create a nimble organization that competes with new mobility startups and internet ventures? What is your roadmap for integrating design thinking, co-creation, agile processes, and rapid releases?
- What is your plan to establish a data-driven culture? Remember, this includes a willingness to infuse insights into virtually every action, interaction, and decision.
- What is your strategy to continuously re-skill your organization to take advantage of digital technologies that power new ways to work? How will you leverage business partners and other channels to fill skill gaps?