IoT in automotive industry, an Analysis

The Internet of Things: driving automotive industry innovation

By Sanjay Ravi, Managing Director, Worldwide Discrete Manufacturing, Microsoft

The automotive industry has been a hotbed of technology for decades. From Henry Ford’s moving assembly line and mass production to electric engines to cars that drive themselves, technological advances have been embraced by engineers and innovators alike. A recent report by The Boston Consulting Group, a global management consulting firm, found that almost half of the world’s top 20 “Most Innovative Companies” are automakers.

In the current time of the Internet of Things (IoT), the opportunities for continued innovation are better than ever. It’s enabling a dramatic acceleration that has the potential to significantly alter the competitive landscape, sparking what the manufacturing industry is calling a fourth industrial revolution.

Creating new opportunities for automakers

With today’s advancements in sensors, devices, connectivity, machines and data insights, automakers have the ability to advance innovation in all areas of their business, from sales, marketing and service, to the factory floor and supply chain, to delivering superior manufactured vehicles and customer experiences.

Converging the physical with digital systems, it is also able to usher in new opportunities for revenue growth. For automakers this includes adopting new business models to deliver personalized experiences and new services to consumers from anywhere. And there’s nowhere where the opportunity is greater to innovate customer service and develop new services than in the vehicle itself.

Enabling connected-car innovation

There is a huge transformation happening when it comes to the vehicle. According to Gartner, Inc., by 2020, there will be a quarter billion connected vehicles on the road, making connected cars a major element of IoT.

The connected car experience is the future of the automotive industry. It is changing the relationship between automakers and their customers, creating long-term relationships in ways never before possible—long after the original purchase. And it is creating new revenue streams by enabling value-added, in-car services that can seamlessly integrate with the customer’s daily life and work, take advantage of their own devices, and build personalized experiences.

Driving connected experiences through the cloud

We are seeing tremendous evidence that carmakers are leading the way in using the latest in cloud computing, data analytics and intelligent devices to transform both the way they engage with consumers and how their value chain performs, both critical components to delivering the next generation of connected consumer experiences.

New, powerful examples of IoT innovations were front and center at the recent Hannover Messe industrial fair in Germany, where this next industrial revolution was on display. For the factory floor, KUKA Robotics demonstrated one of the world’s first showcases blending IT with robotic technologies into a smart manufacturing solution with new capabilities that evolves human-robot collaboration. Its robots can now sense their surroundings and learn tasks with the help of human movement!

The Lotus F1 Team showcased their ability to fine tune and drive every aspect of their business, from managing the design, manufacturing and testing of the 20,000-plus parts on each car to analyzing real-time data from the race track and soon leveraging machine learning to gain insights for their cars’ continued development. And Toyota talked about using technology to enable its employees to be more efficient and empowered to collaborate around the world, helping improve vehicle quality while reducing costs.

And when it comes to connected-car services, Chinese automaker Qoros offers an advanced vehicle telematics system to provide communications, entertainment and location-based services anywhere in the world. Ford recently announced its cloud-based Ford Service Delivery Network that will bring new connected vehicle features to market faster and offer flexibility for the future. And using IoT capabilities, Delphi Automotive created Delphi Connect that can make any car a connected car, giving drivers of older vehicles many ways to remotely monitor and control their cars.

Learning from the leaders

As we look at the tremendous examples of innovation in the automotive industry, there are a number of things that enterprise businesses, regardless of industry, can learn from today’s leading automakers.

One of the biggest ways companies can create an advantage from IoT technologies is to institute a digital mindset and simply take that first step and connect your products to applications and cloud services. Today we have connected cars but also buildings and even appliances.

Leading carmakers are also connecting line of business assets with other data, systems and processes in the company, looking at the best places to enable innovation, particularly within departments or processes that are closest to the customer.

When inexpensive, easily deployable and intuitive technology is implemented the right way, enterprises can create more efficient businesses, bring products to market faster and grow sales and profits with innovative service offerings. We look forward to what the Internet of Things will bring to your business!

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