BUSINESS On Demand Car Functions (ODCF) in the context of automated driving IT
Introduction Oliver Wucher Partner, Market Lead Automotive & Industry, CIO Consultant for Automotive clients since 1997 Expert in: Project and Program Management IT-Strategy / IT-Governance Automotive / Digitalization References (selection) Alexander Strauß Manager Automotive Manager in the Automotive business since 2010 Expert in: Project and Program Management Innovation Management / Roadmapping Automotive / Digitalization References (selection) Page 2
Q_PERIOR Automotive: Figures Facts Data We actively support premium OEMs with their digital transformation. 177 REVENUE 2017 [MIO. ] (Q_PERIOR included ESPRiT Engineering*) 34% REVENUE INCREASE IN 2017 31 STAFF NATIONALITIES Awards: (seletion) >1100 CONSULTANTS of which> 170 with automotive experience 100% OF THE GERMAN PREMIUM OEMs are Q_PERIOR customers >500 SUCCESSFUL AUTOMOTIVE PROJECTS Page 3 * Services of our subsidiary
Service portfolio Q_PERIOR provides cross-industry issues combined with dedicated automotive innovation themes. AUTOMOTIVE BUSINESS CONSULTING SERVICES Digitalization Strategies & Roadmaps Sales & Customer Management Supply Chain Management Business Intelligence & Analytics Financial & Management Accounting Strategic IT Management Risk Management, Compliance & Regulation INTEGRATION SERVICES Program & Project Management Requirements Engineering Business Analysis Migration Test & Implementation Management IoT / Connected Car / Connected Reporting On Demand Car Functions (ODCF) Agility in the automotive industry Engineering Services * Automotive Strategy Consulting IT CONSULTING SERVICES SAP Implementation Systems Architecture Consulting System Integration IT Strategy, Sourcing & Service Management IT Security Software Development (JAVA,.Net, ABAP) Page 4 * Services of our subsidiary
Source: SAC - 2018 Mobility THEN and NOW The real disruption of automotive business starts now. Behind Level 5 (HAD - highly automated driving) real disruption of automotive ecosystem Technological Innovation but no fundamental change of business case! Horse Wagon First Cars Mass Produced Automated Production Systems Individualization Electromobility Digitalization Connected Car HAD Mobility Services Robo-Taxis < 1900 ~1900-40 ~1950-80 ~1990 ~2010 ~2015-20 ~2025-2030 ~2035 Page 5
Correlation between automated driving and New Usable Time The higher the level of automation, the higher is the amount of New Usable Time. New Usable Time (NUT) Driver No Feet No Hands No Eyes No Brain No Driver instead of this you can do new/other things inside your car! Picture Source: https://www.enbw.com/blog/elektromobilitaet/elektroauto/wann-kommt-eigentlich-autonomes-fahren/ Page 6
Time spent in the Car People spend approximately 100 minutes per day in the car for driving but also in traffic jam. Germany USA Japan ~ 160 min/day ~ 95 min/day ~ 50 min/day Ø Jaguar ~ 100 min/day Source: Survey Study Value of Time, Fraunhofer IAO, 2016 Page 7
How can we use the New Usable Time? People will spend their time in 6 main categories of human needs. Well Being Information Entertainment Productivity Communication Basic Needs Source: Fraunhofer IAO 2016 Pictures: pexels Page 8
How can we use the New Usable Time? On Demand Car Functions can be the Nutcracker. New Usable Time (NUT) On Demand Car Functions very diverse and individual perception of needs individual and variating satisfaction of personal wishes also over the time A variating function set is necessary to satisfy all customer wishes! Pictures: pexels, ernaehrung-lorenz, art+form Page 9
How can we use the New Usable Time? ODCF associated to each category of human needs. Needs Well-Being Information Examples Comfort (e.g. Massage, ambient light), Relax-Programs, Assistance, Interior Aromatisation, Car Performance Increase, Car Information, Weather, Traffic, Social Media, News, Internet, Entertainment Productivity Communication Basic Needs Source: Q_PERIOR Survey Study, Tim Kayser - 2018 Music, Television, Movies, Learning, Gaming, Office Functions, Parking, Drivers Logbook, Ticket Booking, Paying, Automated Driving, Calling (Video), E-Mail, (Voice) Chats, Messaging Services, Safety/Security, Automated Driving, Assistance Systems, Food and Drink Order, Pictures: Instagram, Microsoft, foodora, ernaehrung-lorenz Page 10
On Demand Car Functions Q_PERIOR Survey/Study - ODCF as new revenue stream for the car of the future. 528 Participants 5 Expert Interviews Results Market Volume Function relevance Usage Probability Distinction of Customer Segments Source: Q_PERIOR Survey Study, Tim Kayser - 2018 Page 11
Percent of People, that are willing to pay for additional functions Three quarters of all users are willing to pay for additional functions. 76% 75% Translation: 75% of users are willing to pay for these additional Services. Source: Q_PERIOR Survey Study, Tim Kayser - 2018 Source: Survey Study Value of Time, Fraunhofer IAO, 2016 Page 12
Monthly willingness of People to pay for ODCF ODCF have an extrapolated yearly revenue of 10,75 billion. Generation Y/Z Volume Segment Luxury Segment Ø German Driving Licenses 55.860.000 Extrapolation Yearly Revenue BILLION Precarity Source: Q_PERIOR Survey Study, Tim Kayser - 2018 Page 13
Market for On Demand Car Functions The market for ODCF will increase rapidly over the next 15 years up to 22%. % Global Automotive Revenue % Global Automotive Revenue Source: Q_PERIOR Survey Study, Tim Kayser - 2018 Page 14
Usable Time Importance of On Demand Car Functions On Demand Car Functions must be implemented in the strategic foresight of OEMs. Example: Entertainment Other five human needs With a higher level of automatization, there will be a shift in the needs of our customers and therefore also a shift in special On Demand Car Functions. Strategic foresight is really necessary! 0 1 2 3 4 5 Level of automation Page 15
Roadmapping The history of roadmapping and its purpose. 'Roadmapping' is an interesting and flexible class of method (management tool) for supporting strategy and innovation. (Rob Phaal - https://www.cambridgeroadmapping.net/roadmapping/) First Time of Application at Motorola (End 1970 s) strategic alignment of technology- and product development processes Roadmapping Bridge between current situation an the future Way to your vision / way to your strategic goals Relation / linkage between: Market Business Products / services Competences Resources, etc. Page 16 16
Roadmapping The general method and architecture of a roadmap shown in one slide. Reference: Rob Phaal University of Cambridge Page 17
Roadmapping How an example for an ODCF-Roadmap architecture can like. Time Know when! Market Customer Trends / drivers Barriers Know why! Pull Product vehicle (Level 0-5) ODCF function xyz Technologies Smart Materials, Camera Systems, etc. Resources Competences Partnerships Enabler, etc. Know what! Push Know how! Page 18
Roadmapping Create roadmapping content for On Demand Car Functions. Know when! Know why! Know what! Know how! Page 19
Roadmapping A Roadmap can show correlations between automation level, ODCF, necessary technologies and all other layers. Know when! Know why! Know what! Know how! Page 20
Conclusion Opportunities and Challenges of On Demand Car Functions. Opportunities Use the new opportunities in conjunctions with automated driving. Create benefit out of the New Usable Time, that users spend inside the car. Offer additional functions to your customer for this New Usable Time On Demand Car Functions. Take the chance of the new market and generate new business. Challenges Disruptive change of the business case, initiated by connectivity and digitalization. Continuously varying customer needs and markets. Only with a strategic planning and a clear roadmap you will be able to develop the right solutions for the future. Pictures: audi, bmwi, pexels, pixabay, ernaehrung-lorenz, art+form Page 21
Contacts Working for you locally and internationally. Thanks a lot for your Attention Oliver Wucher Partner Alexander Strauß Manager Q_PERIOR Leopoldstr. 28a 80336 Munich Germany Office: +49 89 45599.0 Mobile: +49 151 12043807 oliver.wucher@q-perior.com www.q-perior.com Q_PERIOR Leopoldstr. 28a 80336 Munich Germany Office: +49 89 45599.0 Mobile: +49 160 90264643 alexander.strauss@q-perior.com www.q-perior.com HAMBURG l FRANKFURT l MUNICH l ROSENHEIM l ZURICH l BERNE l VIENNA l LONDON l NEW YORK l TORONTO l SARAJEVO Page 22