AUTOMAKERS BECOME SOFTWARE COMPANIES

As the smartphone market continues to expand transportation methods, and to do this, cars need
and initiatives like smart electric grids continue to to be equipped with software that can monitor and
pick up steam, another industry has begun getting enhance vehicle function at the most basic levels.
"smarter" with software and apps: the automo- The eventual system would require that cars feed
bile industry. Ford, BMW;and other automobile increasing amounts of information to systems
companies are enhancing their vehicles with on- whose purpose would be to minimize highway con-
board software that improves the customer experi- gestion. The system would also require an industry
ence, and the auto industry is working on technology standard, which does not exist as of yet. Ford has
that will allow cars to be managed via the cloud. doubled its investment in vehicle-to-vehicle com-
Automakers are finding that software is a way of munication technologies and BMWis also continu-
adding more "value" and freshness to their prad- ing to develop ways for vehicles to communicate
ucts without having to invest so heavily in new with one another on the road to avoid collisions.
vehicle production. It takes Ford Motor Company, With the inclusion of software in their cars,
for example, about two and one-half years to plan, automakers are entering uncharted territory. They
design, and build a new caroDesign and productiori, must now devote resources to updating and testing
including metal stamping equipment and assembly their software, as well as establishing ways to
line setup, must be finalized long before the car pravide the updated software to their customers.
rolls off the line. But the auto makers can create Car companies need to coordinate their car devel-
a new software interface for a car within months opment cycles more closely with their software
and update it again and again over the life of the development cycles. Also, many of the technolo-
car without much lead time. This enables Ford and gies included in automobile software packages raise
other automakers to significantly improve the pas- the same privacy concerns surrounding location
senger experience and add new features to cars tracking that have often plagued smartphone man-
years after they are built. ufacturers and app developers.
Ford is perhaps the automaker doing the most Ford is grappling with the best way to roll out
to innovate with software and apps. Its MyFord software upgrades to its customers. The company
Touch interface is an in-dash touch screen avail- has been mailing USBsticks to 250,000 customers
able for select vehicles with controls for navigation, whose cars have an advanced touch screen
music, phone integration, and temperature. Ford control panel running the MyFord Tbuch interface.
has upgraded this interface and the Sync software The stick contains a software upgrade that will
behind the interface, adding tablet and smartphone improve navigation controls, the music and phone
integration and better voice response. In 2010, Ford features, as well as the ability to control car tem-
added support for the online music streaming ser- perature. The upgrade also contains code that will
vice Pandora, which is very popular among young upgrade system speed and imprave the interface
potential buyers. This update enables drivers to based on common criticisms from Ford owners.
connect their tablets and smartphones to the Sync A1though Ford says it plans to continue issuing
system to access music and other apps using voice software upgrades this way, the company hopes
commands. that customers will get into the habit of check-
Chairman Bill Ford Jr. has championed the ing the Ford Web site for software upgrades on
use of software to alleviate urban congestion their own. Though most car owners are used to
by investing in technology that responds to the the technology in their cars remaining constant
problems created by traffic in the biggest cities. throughout the life of the car, newer cars are poised
Theoretically, technology might help cars to avoid to change all of that.
traffic jarns, to reserve parking spaces in advance, Ford has hired "human-machine interface engi-
and possibly to even drive themselves. neers," whose job is to analyze how their customers
To manage vehicles in this way, cars need to be interact with the software in their cars. Often, these
connected to some kind of central system, which engineers use customer feedback to make changes
would coordinate with public transit and other to the software. Customers complained that too
 Chapter 3 Information Systems, Organizations, and Strategy 135

much information was available on each screen of sensitive customer data and to provide robust
the interface, so Ford moved the most commonly privacy options. On the other hand, automak-
used features to more prominent ers are hoping that younger customers who have
positions on screen and increased their font size, grown up using Facebook are less likely to care
relegating the rest to submenus. Feedback has been about privacy, and features that collect highly
positive. Ford has also asked dealers to dedicate targeted information about a car's location and
more time and personnel to hands-on technology driving habits.
training to help customers master its interface. BMWis also investing a whopping $100 million
GM, Daimler, and other companies are all in mobile apps, hoping to market them to their
developing new features for their cars that operate customers as "prernium services." Some analysts
online in the cloud. Users will be able to remotely are skeptical of the decision to invest that much
track their cars (you'll never forget where you money, but BMWbelieves that mobile apps will
parked again) and diagnose problems with the car, become an increasingly attractive selling point for
like low tire pressure or the need for an oil change. customers of its BMWielectric and hybrid cars.
Corporations will be able to track employee use Although the future of cars sharing information
of company cars by interpreting car sensors and with other nearby cars is still years away, automak-
engine readouts. Manufacturers will be able to ers are excited by the possibilities afforded by smart
aggregate and analyze the data from custorners' software and apps.
cars to identify quality problems and, if neces- Sources. Ian Sherr, "Cars Pump Up 1Q To Get Edge," The Wall
sary, quickly issue recalls. Just as with apps, the Street [ournal, .Ianuary 13, 2012; Chris Murphy, "4 Ways Ford Is
possibilities are limited only by the imagination of Exploring Next-Gen Car Tech," Information Week, July 27, 2012;
Mike Ramsey, "Avoiding Gridlock with Smart Autos," The Wall
automakers. Street [ournal, February 27, 2012; Joseph B. White, "New Driver's
GM will allow its app developers to access Ed: Thtors to Decode High-Tech Dashboards," The Wall Street
its computer systems to improve app function, [ournal, May 8, 2012; Chris Murphy, "Ford is Now a Software
Company," Information Week, November 28, 2011 and "Why BMW
which raises a familiar set of privacy concerns.
Strddenly Loves Mobile Apps," lnformation Week, March 2, 2011;
Auto analysts believe that automakers will make and Chuck Squatriglia, "Ford Brings SmartPhone Apps to Your
mistakes as they learn how to properly handle Dashboard," Wired, April 20, 2010.

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