The Promise – and Challenge – of Integrating IT into the Auto Industry

automobile-technology-1024x440If Nissan Motors has its way, there will be no auto accidents involving the Japanese company’s vehicles by the year 2050. At Toyota Motors, a similar initiative has the eventual goal of achieving “zero casualties from traffic accidents.” In the years ahead, those companies – along with other major auto industry players in Asia, North America and Europe — will be rolling out more and more vehicles that promise to do no harm to the environment – because they are battery-powered – or little or no harm to their occupants and pedestrians because they are loaded with safety features developed in the disruptive world of digital high-technology.

What are some of these technologies, and how are they being introduced into the tightly integrated systems of the automotive sector? What fundamental challenges are involved in achieving a smooth process of integration? These questions, critical for the future of the automotive sector, were discussed recently at the Mack Institute Fall Conference 2013, whose theme was: “When Disruptive Technologies Meet Integrated Systems: Who Captures the Value?” 

‘Less Integrated, More Modular”

The automobile is about to undergo its first fundamental change in dominant design since the late 1920s, according to John Paul MacDuffie, director of the Mack Institute’s Program on Vehicle and Mobility Innovation (PVMI) and a Wharton management professor, as he led off the conference. While the automotive sector is “quite tightly” integrated, more and more technologies are arriving from the high-tech sector, which is structured in a different way.

Read the Rest of the Article>>

Originally Published January 22nd, 2014 by Knowledge@Wharton.