Date of Award
Master of Science (MS)
Automotive industries have continued to expand, as they cut on costs by regulating efficiency, grow and make profits. The factors that have continued to change the industry include marketplace growth, outsourcing for product development, customers demanding for improved reliability, development of human-vehicle software and have continued to change the automotive industry. As a result, companies have continued to face numerous challenges to manage the factors. The challenges include managing volatility, experiencing massive uncertainty, as well as reduced predictability of future businesses. Other challenges include handling a complex and interconnected industry and the need to form joint ventures and maintain successful supplier relationships.
The Automotive businesses must change their operating models to advance agility. An example includes ensuring OEMs is flexible to operate across the value chain and provide value-add, as well as personalized experiences. The Automotive companies must learn from Google and Uber that have embraced digital activities to market new business models that can promote innovation. The study conducted by Crute et al. (2013) showed that over 30% of automotive businesses are willing to invest in advanced business models likely to drive value from new capabilities. According to Elkins et al. (2014), having an advanced operating model permit digital abilities that could reduce costs and support growth.
While rethinking of an operating model, the automotive companies must choose the ones that are digital to help them improve efficiency as well as agility. According to Hallgren and Olhanger, (2009), when companies operate on lean strategies, then they free up costs that could likely to be reinvented to other significant fuel growth strategies and maintain a competitive advantage in the industry. When companies invest in new business models and advanced digital abilities, then they engage in aggressive growth. An example includes automotive firms moving beyond manufacturing of vehicles to join the wider ecosystem that opens new business opportunities to build new capabilities, collaborate with other partners to invest heavily in innovation (Poppendieck & Cusumano, 2012).
The focus is on improving customer experiences through expansion strategies that include joint ventures or acquisitions. It is impossible for companies to enhance efficiency and performance without having a talented staff that is committed to the delivery of quality products and services. Digital activities and innovation-driven automotive industry have increased stakes for company processes across the value chain. Devadasan (2012), therefore believes dealerships, OEMs, and manufacturers of vehicle parts require individuals that are digital savvy to initiate the transition to digital corporations (Tuck et al. 2006). The techno-savvy employees use digital strategies to improve customer experience, leading to many companies to invest in human resource practices such as training of employees.
Datrika, N. K. (2018). Implementing Agile Methodology Techniques in Automobile Industry. Retrieved from https://digitalcommons.harrisburgu.edu/pmgt_dandt/38