Case study: AUTOMAKERS BECOME SOFTWARE COMPANIES

1.       How is software adding value to automaker products?

By reducing the cost and time of new car production, software adds value to the car manufacturer's products. In addition, by using on-board software, you can help improve and allow the management of automotive manufacturers' products to be managed via the cloud.

For example, Ford Motor Company needs two and a half years to plan, design and build a new car. Design and production, including metal stamping equipment and assembly line setups, must be completed before the car goes off-line. However, by using the software, automakers can create a new software interface for the car in a matter of months and update it over and over again throughout the life of the vehicle without requiring too much time. This allows Ford and other car manufacturers to significantly improve the passenger experience and add new capabilities to the car within a few years of its completion. We can conclude that software can add value to the Ford Motor Company's product while reducing the cost and time of new car production.

2.       How are the automakers benefiting from software-enhanced cars? How are customers benefiting?

       Firstly, software helps to alleviate urban congestion by investing in technology that responds to the problems created by traffic.

        Furthermore, many of the technologies included in automobile software packages raises the same privacy concerns surrounding location tracking that have often plagued smartphone. This is the best way to roll out software upgrades to its customers. By implementing software-enhanced cars, it can easier the customers to navigate the road and car with additional software.

        By using software-enhanced cars, customers will be able to interact with each other or with others as they happen on the road. In addition, all smartphone users can connect and analyze data for automotive applications.

3.       What value chain activities are involved in enhancing cars with software?

       In Ford Motor Company, MyFord Touch interface is an in-dash touch screen available for select vehicles with controls for navigation, music, phone integration, and temperature. Ford has upgraded this interface and the Sync software behind the interface, adding tablet and smartphone integration and better voice response.

        In 2010, Ford added support for the online music streaming service Pandora, which is very popular among young potential buyers. This update enables drivers to connect their tablets and smartphones to the Sync system to access music and other apps using voice commands.

        Furthermore, Ford has doubled its investment in vehicle-to-vehicle communication technologies and BMW is also continuing to develop ways for vehicles to communicate with one another on the road to avoid collisions.

4.       How much a competitive advantage is software providing for automakers? Explain your answer?

       Software provides more competitive advantages for automakers. Generally, Software provides the automakers a competitive advantage of allowing cars to be managed via the cloud. Take for an example, Ford Motor Company is enabling the software that operate online in the cloud for cars to enables users to be able to remotely track their cars or even diagnose problems with the car such as the problems of low tire pressure or need for an oil change. These software development provide a new platform for automakers to enhance many car drivers’ life by just a touch of a finger through a touch panel.

         The reason why software providing for automakers with so many competitive advantages is software upgrading the quality of the cars and support the cars with many convenient facilities.