Why Automotive Is Leading the Way in IIoT Business Opportunities

The Industrial Internet of Things (IIoT) goes far beyond the enterprise. Today, it's vital that manufacturers prepare to benefit from the extended IIoT because others will take the rich rewards available if manufacturers do not take the lead. Over the last few weeks we have been looking at Manufacturing Operations Management (MOM) as part of an IoT strategy in a specific industry, and at the opportunities coming from moving functionality into the cloud. All these examples have been enterprise focused. 

Today one industry is well ahead of most others in terms of development of IIoT business opportunities. The automotive industry is the most active battleground for IoT applications that will bring real improvements to consumers. One could even ask if the center of automotive development today is Silicon Valley or Detroit. Both automotive OEMs and the mega high-tech companies are battling for the control for the next generation of autonomous vehicle.

The University of Michigan, Ann Arbor has opened a new test track for autonomous cars referred to Mcity. The test center allows the driverless vehicles to be tested with realistic on-the-road scenarios. Mcity has become a mid-country center for automotive developments, one that competes with Silicon Valley. To learn more about the center refer to the university website.

Although mass market autonomous vehicles are clearly still a few years away, IoT-centric applications and the connected car are here today. OEMs and automotive suppliers have a real opportunity to build applications to improve their relationship with consumers who buy their products. In the past the new car buyer would be most interested in color and price while today they are far more likely to put connectivity with their phone at the top of the must-have features. Most of the perceived value of new cars in the coming years is going to come from bits and bytes, not steel and leather. It is vital for the future profitability of the automotive industry that OEMs lead the way in making money out of data.

From Where Does Information Come?

In a previous post we discussed grip as a service for tire manufacturers where an OEM can record information in the car and sell it to one of its suppliers (in this case the tire supplier). OEMs can gather a lot of information from in-car data, but so can the maker of navigation systems and other applications that use external data connections. OEMs have a huge opportunity to improve their customer service by creating applications that will give an increase in customer engagement. Much of this revolves around the as-built and as-maintained “record” of each vehicle.

During manufacturing, the opportunities to collect data about each vehicle are unlimited. Once the car is delivered, this information can be used to communicate with the end user in many ways. In order to enable this type of communication, OEMs should ensure that they no longer aggregate manufacturing information from their manufacturing information systems. Store the raw information in the cloud and work out how you can use it over time. Aggregated information will do little to improve one-to-one relationships with drivers.

Make the Driver Your Friend

Of course, OEMs generally dom't have the end user as their customer, but it's the end user who makes brand decisions for the next purchase. So, it's imperative that, while not undermining franchised dealers, OEMs can build a good relationship with their users. There are ways to improve service through dealerships and direct contact with the driver and her car:

• Monitor technical issues in the car – Make an appointment with the dealer via the car, ensure that the exactly correct spares are available at the dealer on time and that the driver’s preferred beverage is ready and hot upon arrival.
• Manage updates – Inform drivers of any potential mechanical upgrades recommended on their car. Do this before the dirty word “recall” is required and spread out the work to enable handling by the dealer network.
• Keep central as-maintained records up to date - Occasionally two identical cars might roll off the production line; after its first visit to the dealership, every car is unique. Make sure that is recorded and passed from the dealer back to your cloud applications as well as stored at the edge (in the car). Data on maintenance actions can be fed into big data analytics and then into product improvement and new designs.
• Offer free upgrades through software – Time this with service intervals to minimize disruption. In some cases, direct download of updates is quite feasible, but drivers might be wary of this if it has some mechanical effect on the car (As an example, my car got its shift patterns updated – that was done in the dealership, and was explained to me so I did not get a surprise).

Information will be the most important aspect of the automotive battleground in coming years. OEMs have a great opportunity to maintain their added value (and to share it with their suppliers) by building their IoT platform to enable sharing of data in both directions with the cars they have sold. Raw manufacturing information coming from MOM and other systems will prove valuable. You don't know for what its valuable will be. Yet. So even if it seems unimportant today, don'y throw it away, starting tomorrow.