The Internal Transformation of the Automotive Industry

Florian Rohde, the Managing Partner at iProcess, joins Point B in a two-part discussion on the internal transformation of the automotive industry. How do startup and legacy automakers need to change their processes, mindset, and approach to successfully support the development and advancement of the software defined vehicle?

1:02 The role of iProcess in the automotive industry

2:22 What is Agile and what is the waterfall approach?

4:21 The importance of a whole company approach to Agile

5:45 Best practices for the transition to a software defined vehicle 

8:08 The backbone approach to maintaining and improving SDVs

9:17 Things new age or disruptive OEMs should know about SDV development

11:08 The meaning of CASE and ACES

13:16 The next generation of vehicle updates and preventive maintenance

Announcer:

Welcome back to another episode of Point B, a Sibros podcast where we interview industry experts about the latest innovations and trends in automotive technology and the connected vehicle industry. Tune in to learn about topics ranging from the next generation of electric vehicles to advances in connectivity and micro-mobility.

Steve Schwinke: 

Hi, my name's Steve Schwinke. I am the host of the Point B podcast and I'm very excited today to be speaking with Florian Rohde, Managing Partner at iProcess. And today we're going to be exploring the transformation that's taking place in the automotive industry. A little bit about Florian. Prior to becoming the Managing Partner at iProcess, he worked at Neo, and before that, he was at Tesla leading their firmware validation and integration efforts. Very extensive automotive background, including work at Siemens and Continental. So, Florian, I want to welcome you to Point B. Thanks for joining us today. Why don't we start by telling us a little bit more about iProcess and what you're doing in the automotive space?

Florian Rohde:

Absolutely. Hi Steve, and thanks for having me. Thanks for the introduction. So at iProcess we're supporting both sides of the spectrum. We're supporting startups, and cross movers in the mobility sector getting ready for the real world out there, guiding them through functional safety, cybersecurity, process requirements from OEMs and regulatory bodies, helping them to get the necessary certifications, and most important, to transition from a great product idea to a scaled and profitable business. On the other hand, we are helping established automotive companies, suppliers, and OEMs set up their strategy for the next generation of mobility, the software-defined car. We are helping streamline their processes, development, and validation approaches to move from a classic waterfall to an agile approach, while still maintaining their culture and brand. Some of those companies are around for, and successful for, almost a hundred years or more. So you can imagine that there are some interesting challenges.

Steve Schwinke:

I want you to talk a little bit more about Agile. I remember when I was at General Motors, I had a big sign up that said, “You know, we don't always do agile, but when we do it's waterfall.” So are they really going towards this Agile type of software development that's really, you know, kind of associated with the West Coast way of thinking and doing software.

Florian Rohde:

I mean, I would even say it the other way around. So when we do Agile, it's like a continuous waterfall and basically that's what Agile is. So you have iterative development and much shorter timeframes or iterations. So you're not doing the traditional waterfall where you have several weeks of development, and several weeks of integration, several weeks of validation and testing, and then you go all the way back and you run again. But even in the waterfall process it's an iterative process. It's just stretched out over a longer time. I believe back in my Conti days, it was about three months for an iteration. While in agile you're talking more about two-week sprints and probably daily iterations throughout the testing and development lifecycle. 

So long story short, the established players have to do something to get closer to the expectations of the customer, right? The customer is used to improvements in their user experience on their phones, their computers, and they want to see that in their mobility as well. So the classic three month waterfalls will not work. If you shorten the waterfall to daily waterfalls then you are suddenly pretty much Agile.

Steve Schwinke:

So that's interesting. But it's not just the transformation that has to take place at an OEM that wants to go to faster iterations. It's the whole business too, because the business has been built on three-year vehicle development life cycles, long planning cycles, and then not really being sure if the product is actually going to meet the customer's expectations. So one of the things that Agile gives you is the ability to iterate and move much quicker, but the whole company has to embrace it, not just the software development part of the organization. Isn't that kind of how you see things?

Florian Rohde:

Absolutely. So Agile definitely gives you the chance, also, to change directions really quickly. If you are in a long development cycle, you have to go toward the end before you can actually improve or innovate. With the Agile approach, you can do that on really short notice, but absolutely it has to be in the blood of everybody involved and also in the architecture of your product. If your product has a development cycle of, you said three years, I heard up to seven years, it's very very hard to change something after halfway through that. So the architecture of your product, of the car, of the mobility you're providing, has to be designed in order to receive Agile increments and improvements.

Steve Schwinke:

I think what we're seeing in the industry is that everyone wants to be faster, more nimble, more agile, but getting them to a place where they can be that quick, it's tough, right? I mean, this is still an automotive type of activity where it does take years to develop a vehicle. So there's some real challenges for these companies out there. Do you have any best practices that you're seeing to help companies get through this transformation, at least with the bigger OEMs?

Florian Rohde:

Yeah, I have actually a great example that comes to mind. It was a large OEM from Europe, and I was telling them about the idea of test early, fail early, fix early. Test often, fix early in the process, and so on. And it took a while because they came with their standard waterfall mindset and said, “Hold on, it takes us six weeks to test. So how can I test often if it takes me that long?” During the communication, during the discussion, at one point it kind of clicked on their side and they said, “Hold on, I'm really capable of testing that often, and actually, I don't have to test everything every time because I have the iterations throughout my product development.” So just the mindset – and I think this is one of the main topics we will come back a couple of times during the discussion – the mindset has to change. That you say, “Okay, I can also do not only iterative development, but I can also do iterative testing” and this has to come together. 

I really like to mention that one without the other doesn't work. So it doesn't help if you are really fast and iterative and continuous in your development, but your testing lags and takes weeks. The same thing, it doesn't make any sense to accelerate your testing to be capable of doing full regression tests within days or even hours, if you only create new stuff to test every six weeks. So it has to come as a package and everybody has to be involved and pull in the same direction

Steve Schwinke: 

You get me thinking about this a little more and it's really dependent on the electrical architecture. It's dependent on how you construct basically the whole platform itself that you have these systems that you try to make them loosely coupled in terms of less dependencies on other systems in the vehicle. And you have established contracts so that people can be nimble. That you don't have to do the full vehicle validation every time, you can test your component and have it not be disruptive to other parts of the vehicle. Is that kind of that mindset as well?

Florian Rohde:

Yeah, so originally, or basically over the last 40 years, control units in the car were designed to be developed until they're ready. Right? And then they go into production and then you ship them. It was never the idea to continuously modify the content on those controllers. So the original approach is, you have a feature baseline and then from there on you go into your next development cycle and for the first six-eight weeks, the whole product doesn't work. And then you go into the integration phase. 

Now going into the software-defined vehicle approach, I call it backbone software functionality. So the car is always working. Granted, some features are under development and are not performing at a hundred percent. But on day one after the last release, I can still drive my product to test new features in their development. And of course, the whole system has to be architected in a way that it can actually digest iterative improvements.

Steve Schwinke:

So Florian, I'm going to shift to the, I'll call them the new-age OEMs, and they're fast, they're nimble, but they lack certain things. What are the things that you're helping them with as they try to develop a vehicle for the automotive sector?

Florian Rohde:

To build a car is relatively easy. I actually built a car in my garage once. So to build a million cars is harder. Now, those million cars, granted they have electric powertrains, which make the architecture a little bit easy on the propulsion side, right? So that actually creates cybersecurity risks. So you have to take this into consideration. In general, you're creating something that goes onto public roads and into the hands of somebody you don't know. So you have functional safety as a large concern as well. And also it's quality, long-term quality, and also you have to get it to scale, and it has to be fully functional not only in lab conditions. 

So the short answer to your question is those startups, which are coming up with great acceleration and everything, but they have to understand that they have to build a product according to the standards the customer expects. And we explained to them that all those kinds of processes are not supposed to be overhead. They're supposed to help you. If they're slowing you down then you implemented the wrong process. And we are really helping them to become a serious player on the market, and not just a guy who builds a car in the garage for a prototype service.

Steve Schwinke:

Yeah. I really see them transforming this industry. I think, where I came from, very vanilla, we'll call it vanilla, cars get produced on a large scale. But you're seeing vehicles that are now more purpose-built. Things like for urban mobility, where perhaps range anxiety isn't as important as being able to recharge quickly. And so you're still trying to make a more sustainable future, a cleaner environment, for those urban markets. But it's a car very purposely built for sharing.

Florian Rohde:

So I heard a nice term at a conference recently. I don't recall who said it, but somebody said the cars will be ACES, they will be autonomous, connected, electric, and shared. I think it is very important to mention that they don't have to be all of this at the same time. So you can have a shared little city car that might run electric and you have one around the block, like you have a lime scooter, and then for a long distance you might have a car, might not be electric, might be hybrid, but it's autonomous, that brings you on a long travel distance. And I think the only thing that's a given is they will eventually all be connected.

Steve Schwinke:

And they will be more and more software-defined. I mean, is that what software-defined means to you? Is being able to make a vehicle turn into what the purpose is for the owner or the shared ownership?

Florian Rohde:

Yeah, and I think it's for both, right? It's for the ownership itself, for the purpose, but it's also for the owner as customization. So you can now get your really customized personal car just starting with simple things. You know, a background in the navigation screen or something like that. There's a lot of things that can actually come in to really make it an experience rather than just a drive. 

And I mean, you see it from the phone market. 10 years ago you could download a ringtone and that was all customization possible for your flip phone, right? And now it's basically, no two phones are the same. The customer gets in the mood for that. They want to see continuous improvements and some cool stuff to their cars, some more, some less, of course, some are more early adopters than others. But going back to the reference to the phone, I mean, even the slowest adopters moved away from flip phones by now. And we will see that in the car business as well. It might take a little longer because the product costs a little more.

Steve Schwinke:

Well, I also think that experience of having to go to a dealership to get your car serviced. I don't go to the Apple store for my iPhone update. Why would I go to a dealership to get a software update?

Florian Rohde:

Yeah, exactly. And I mean, literally nobody in the world ever said, “Yay I can go to service to get my car fixed.” I mean, I can't blame the technicians working. It's just not a pleasant situation, right? So you have a problem. You need to go somewhere. You need to take time out of your busy schedule. And in many cases, it takes longer than you would hope and in the end you're losing money as well because you have to pay for the services. 

There's a lot of things that can happen through over-the-air updates. That's one thing. And also the buzzword is like preventive maintenance, right? So if I break down with my car on my drive with my family to vacation, that's a terrible experience. If I get a popup in my car that says, “Hey so in order not to break down in the next four weeks, you should call service to replace your 12-volt battery.” That's a pretty convenient situation, especially, once service comes to my house and actually swaps the battery out. I don't have any inconvenience. I don't have, I mean, I have to pay for the battery of course, but I don't have to drive there. I don't have to take time off my schedule. And I have the good assurance that when I go on the road trip with my family, and I don't have that message, that I will actually make it there without a breakdown.

Steve Schwinke: 

One of the reasons why they want to put electric trucks in cities for the last mile is because of the noise pollution. It's not even just air pollution. It's noise pollution. How do you deliver goods and services at night when people are sleeping, when it's not congested, but you got a diesel engine running and people are not happy about that?

Florian Rohde:

Yeah. And I'm definitely people here.

Steve Schwinke:

So Florian, from the bottom of my heart, I want to thank you for joining me on this Point B podcast today. I learned so much about iProcess, about your thoughts on the automobile industry and its transformation that's taking place, and looking forward to continuing our discussion outside of this podcast. But thank you for joining me today.

Florian Rohde:

Absolutely, Steve. It's always great fun to work with you in person but also as the whole crew at Sibros. I think we always, when we interact, have great outcomes, but also great fun together.

Announcer:

Thank you for tuning in to Point B. Join us next time for more Autotech innovations and trends. Point B is brought to you by Sibros.