Creating Competitive Advantage through Digitalization Opportunities & Threats
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1 Creating Competitive Advantage through Digitalization Opportunities & Threats 1 Carsten Kahrs Principal, GmbH ECG Conference Hamburg, 21 st October 2016
2 Agenda Megatrends What drives the automotive industry? Digitalization Threats and opportunities What happens in automotive? Way forward How to create competitive advantage? 2
3 3
4 What was the most used App during the Football World Championship in Germany? 4
5 10 years later the technology is available everywhere in the world 5
6 Amazing speed of market penetration: 1 billion accounts in 5 years 1 Billion Text messaging Hold-to-talk voice messaging 6 Source: Mail online AP Photo/Ahn Young-joon) Broadcast (one-to-many) messaging Video conferencing Video games Sharing photographs/videos Location sharing Social networking Online banking 6
7 Uber's astonishing rise: Overtaking traditional transportation in key markets Text 39% Rental cars % 52% TAXI 36% Rental cars 29% 2015 Source: / Market share USA, % TAXI 7
8 3 megatrends drive the disruption in automotive industry Shared mobility URBANIZATION DIGITALIZATION Self-driving automobiles Ownership Combustion engines Human drive SUSTAINABILITY Electric drive 8
9 Agenda Megatrends What drives the automotive industry? Digitalization Threats and opportunities What happens in automotive? Way forward How to create competitive advantage? 9
10 Product: Software eats hardware Software Electrification Mobility Products Autonomous driving Downloadable features Efficiency increase Different architecture/ platform battery technology Software is the deciding factor on drive pattern New business opportunities Mobility key Flexible drop off P2P Sharing New business opportunities 10
11 Processes: More self reliant and more intelligent Automation Autonomous supply chain Supporting technologies New generation of robots easier to teach Usage of machine learning Close skilled workforce gap Fully connected supply chain Autonomous disposition and demand capacity mgmt. Increase performance through artificial intellig. Augmented reality Predictive data analytics Better quality and easier qualification 11
12 Customer: Value in focus External Partners Mobile Devices Car-to-Car Communication Sharing economy Digital Ecosystem New business models Cars are poor utilized capital goods Reduce idle time from 95% to 10% Possible volume drop by 40% beyond 2035 Cars are becoming part of digital ecosystem Digital landscape accessible during the drive Customized software upload - part of logistics Disruption by High Tech companies and new players Market penetration all or nothing Threat for existing players in every sector 12
13 Logistics Industry is not leading in Digital Process Index (DPI) Telecommunication and IT Banks and insurances Media and entertainment Electronics Automotive Energy Retail Pharmaceutical and Chemistry Mechanical Engineering Logistics 65,4% 61,9% 56,1% 54,2% 54,1% 52,2% 50,9% 47,9% 47,0% 46,8% High complexity & high legacy in comparison with media, banking and retail high value and more B2B environment Source: Digital Development Institute d.velop 13
14 Opportunities and threats for finished vehicle logistics Opportunities Efficiency increase through digital innovations New business opportunities through new products Close the skilled workforce gap through automation and digitalization Threats Volume of vehicles might drop through sharing economy New market entrants with enhanced software solutions can offer disruptive business models Autonomous driving can reduce the demand for finished vehicle logistics 14
15 IT security From Network & computer to the real world and towards artificial intelligence Digital twin & intelligence Advanced simulation Artificial intelligence Machine learning Cloud 5 Software Cloud computing Network & infrastructure Computing power High memory capacity 9 High speed network Real world 1 Inventory Sensor RFID 2a Autonomous Loading to trucks or trains 3 Autonomous Driving 2b Autonomous Loading to ships 4 Autonomous cruising/ sea transport 15
16 Agenda Megatrends What drives the automotive industry? Digitalization Threats and opportunities - What happens in automotive? Way forward How to create competitive advantage? 16
17 What Porsche is doing to create competitive advantage 1 DEFINITION OF USE-CASES 2 TECHNOLOGY MARKET PLACE 3 PORSCHE DIGITAL LAB 4 PORSCHE DIGITAL GMBH 17
18 How do you create your competitive advantage through digitalization? Creating the digital agenda Enabling the organization Start prototyping
19 Some of our basic believes What can be digital, will be digital. Software is eating hardware. Sharing is the future. Disrupt yourself, before others do. Think big. Start small. And scale up what works. 19
20 20
21 Contact Federico Magnio Partner Automotive Mail: Federico. Phone: +49 (0)170/ Carsten Kahrs Principal Supply Chain Management Mail: Phone: +49 (0)170/ GmbH Porschestraße Bietigheim-Bissingen Germany Phone:
22 Fokus Competitive Advantage through Operational Excellence Revenue Mio. (2015) Industries Automotive Aerospace Industrial Equipment Construction/Infrastructure Consumer Goods/Trade Services Mitarbeiter 385 Employees ( ); Ø 8 Years Professional Experience Standorte Stuttgart, Hamburg, Munich, Milano, São Paulo, Atlanta, Shanghai 22 Quelle:
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