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Cloud computing for automotive Cloud benefits to simplify business processes and reduce costs

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The automotive industry is focused on making the most of global operations, globalizing products and brands and changing the mix of capabilities, knowledge and assets. The idea of using cloud-based services in the automotive industry is inspiring innovations in vehicle design, manufacturing, marketing and sales. But as automotive companies add new capabilities and enter new market segments, they face increasing challenges related to the ever-growing barriers of time, cost and risk in aligning IT and business goals. In this dynamic new age, the time has come for a new breed of systems. The key to success in the future will be systems with integrated expertise that are built for cloud. There is a need to address two fundamental questions related to cloud technology for automotive companies that want to take a proactive approach.

1. What is the best way to explore cloud computing technology that delivers the functions necessary to improve efficiency, reduce cost or produce new capabilities?

2. Which applications, services and technologies should be considered for development and deployment within the cloud to meet the goals of the extended automotive enterprise? Many mature technologies and best practices are already available that can be readily deployed using cloud computing.

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Traditional automotive focal areas such as power train, body design and interiors will remain important, but will be joined in the future by sensing capabilities, software and wireless communications which will enable the vehicle to detect road conditions, recognize other vehicles (and pedestrians) near its space and sense environmental changes. Cloud connectivity will make it possible for vehicles to respond to developing traffic situations, find alternate routes and anticipate impending collisions. Overall, the connected vehicle will open new capabilities for safety by enhancing the driving experience in three specific areas: Real-time access to driving conditions and emergency situations Driver assistance and the personalization of the driving experience More convenient services, such as real-time remote diagnostics and the automatic delivery of software patches

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Automotive business pressures

At automotive companies, CEOs are focused on making the most of their worldwide operations, globalizing their products and brands and changing their mix of capabilities, knowledge and assets. Automotive industry leaders are also aware of the implications of business issues like bankruptcies and mergers, th regulatory environment and litigation. During the 2012 CEO study conducted by the IBM Institute for Business Value, CEOs and Public Sector leaders identified technology change as an important external force that will affect their organizations through 2015. Leveraging cloud technology will enable CEOs to respond to challenges and embrace change without making significant capital expenditures. Opportunities exist for automakers to employ cloud technologie to reduce their data center and energy footprint through virtual-ization, and at the same time, address the end of service life (EOSL) problem. A three-year-old server reaching EOSL will generally require a replacement server with less computing power because of the increased technology density of the new server. Virtualization technology is a key component of cloud computing. It can be used to move the EOSL server into a server pool on current hardware where it can reside as a virtual server. Converting multiple physical servers into virtual servers within a server pool can result in lower power and cooling consumption. Virtualization breaks the one-to-one connection between a sys-tem and the hardware upon which it runs. Virtual servers can be migrated transparently from machine to machine. As equipment reaches EOSL, new equipment can be introduced to the server pool. Then the virtual server can be migrated off the EOSL server to the new server. Finally the EOSL server is removed from the pool. No reimplementation or integration efforts are required to swap an old server in a pool for a new server. Cloud technologies can further improve the EOSL solution by extending the provisioning of the resources necessary for virtual servers.

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In the automotive industry, test and development environments are often periodically underutilized. Maintaining these environments is expensive, so automotive companies often prefer to let those machines sit idle until they are needed. A core func-tion of virtualization is the ability to automatically provision and de-provision services; entire images can be moved online and offline quickly. An entire software configuration environment can be moved online and offline, so virtualized development and test environment images can be moved to the cloud cost effectively. Cloud technologies make it possible for new services to be provisioned in the underlying infrastructure. As data volumes grow, the ability to provision vast amounts of low-cost storage is becoming increasingly difficult for automotive companies, but it is increasingly easy using storage clouds. These companies rely on storage with highperformance data access and robust backup/recovery mechanisms. Lost hours caused by prolonged data recovery or lost data resulting from improper backup frequency can put entire vehicle programs at risk. Information protection services provided through cloud technologies can help automotive companies mitigate these risks. Outside of the data center, the traditional desktop client continues to play a significant role at automotive companies. But with it comes the traditional problem: how can you cut computing costs with centralized management without infringing on users desktop computing environment? The cost of hardware and software to provision a desktop PC represents only a small fraction of the total cost of ownership (TCO) for a PC. Cloud technologies make it possible for thin clients or other Internet-connected devices to access managed, platform-independent hosted applications and full client images.

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IT environment challenges
The automotive industry faces many challenges in the IT computing environment. Data center demand for computing capabilities will continue to increase as organizations run their business processes, perform engineering simulations and work with business analytics. Storage needs are growing exponentially to handle the increased volume of data being created through activities such as computer-aided designs and crash-test simulations. By leveraging cloud technology, resources can be requested as needed from a shared environment, dynamically provisioned and/or assigned for the users task and then released for reuse once the task is complete. Cloud storage technologies can help automotive companies address their storage needs. Energy consumption is a serious issue at data centers. The need to obtain the necessary power and cooling to handle the increasing computing demands has become an important consideration and is changing long-held cost dynamics. Vehicle-embedded computers Much of the future automotive innovation will be based on electronics with advanced features and function realized through embedded software. A sizable portion of these innovations will come from companies outside the traditional automotive industry. Software content will increase, and as the amount of software on the vehicle grows, it becomes increasingly important to use cloud technologies to effectively manage and distribute the software. For administration and flashing of vehicle electronic control units, updated software parts need to be distributed from a centrally-managed content system to dealerships around the world. Through enhanced network connectivity, the connected vehicle of the future will be able to use real-time remote diagnostics and prognostics to assess operating conditions and perform some degree of self-repair. Software and other service patches to electronic systems will be automatically delivered to the vehicle using cloud computing technologies, which will keep the vehicle updated with

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a minimum of consumer involvement. When appropriate, warranty information will be communicated using cloud technologies. Original equipment manufacturers (OEMs) and dealers will be able to offer more comprehensive customer relations management by maintaining cloud computing technologies to provide consumer agreement, vehicle usage data and consumer preference profiles. Service alerts, scheduling and notifications will be offered over the cloud based on operating behavior information transmitted from the vehicle. Cloud computing for vehicles offers several major benefits. According to a number of engineers, cloud computing could help reduce the size of the center console. With less hardware under the dash and many data tasks outsourced to a remote server, future vehicles could have slimmer control boards and a bit more leg room. Another advantage of cloud-based computing in vehicles relates to an owners financial investment and an automobiles insurance value. Fewer expensive data storage elements in the vehicle could decrease the cost of our increasingly computerized cars.

Global product development

Abundant engineering skills will continue to be available in countries such as China and India. But distributed product development is difficult because the automotive design environment is global and can be complex with limited or poor integration. Operating across companies, geographies and system domains is a significant challenge, considering the prolif-eration of organizations, processes, tools and methodologies. Infrastructures that support global product development can use cloud computing technologies to recognize and respond to key trends and challenges. Server systems and storage can employ cloud technologies to handle an increasing amount of product development and analysis in the virtual environment. Resources in these systems can use cloud technologies to become sharable throughout projects and geographies, making it possible for them to be rapidly applied to high priority projects

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such as virtual product development, integration of heterogeneous operating environments and globally distributed design environments. Design organizations that target virtual product development need to store and manage increasing amounts of data. Users can take advantage of cloud storage technologies to access and share that data throughout multiple sites and to manage the content throughout its life cycle. The life cycle may include support for product and verification data management, which is the metadata that captures the pedigree of information including who, what, when and where. It also may include support for verification models for analysis, stimulus generators and test cases and the storage of analysis results. Business leaders at automotive companies see the product development landscape evolving quickly. With an increased focus on software engineering, there is a demand for full traceability of requirements throughout the life cycle of the vehicle and a clear need for holistic system design and interac-tion. Leaders at automotive companies are realizing that rapid software innovation could become a major differentiator. Todays automotive product development situation can be described in just a few words: too expensive, too slow and not flexible enough. These problems can be significantly improved by cloud technologies that can help integrate resources that are involved in the development process, including data and information, applications, processes, humans and organizational entities. In most cases, only islands of integration exist, such as a mechan-ical product data management (PDM) system. Singular activities are not using cloud services and systems often are neither aligned nor integrated with each other. Information and activities are often duplicated or missing. Structural breakages and inconsistent terminology also can hinder the consistent description of the product and the process. Older applications are often stitched together with rigid interfaces or monolithic subsystems with encapsulated functionality. These situations can lead to an application management nightmare, solution provider dependency and a loss of enterprise agility.

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All of these problems can be solved using cloud services, whether on the product or organizational side. Using cloud, automotive companies can address integration problems in a more holistic way. It introduces a common language with cloud as the basis for all integration and allows the integration of product data using cloud across engineering disciplines and the lifecycle. Product data can be diverse and include elements such as geom-etries, functions, behavior or physical properties such as weight. Data also may include technical relationships and dependencies, rules and constraints, as well as lifecycle information through cloud for manufacturing (such as as built) and support (for example, as maintained, warranty information and configuration data). Product related data and its relationship to the product data in the cloud also can be integrated. This product-related data may include development artifacts, such as test cases, simulation data and source code. It also may include business data such as cost, schedules, lifecycle information for manufacturing (assembly instructions) and support instructions or ownership data. Applications can also be integrated using cloud. These applica-tions may include authoring applications, systems for process support such as project management applications. Related data may include process models, project schedules, quality gate criteria and key performance indicators (KPIs). Cloud integration also may include stakeholders and organiza-tional units within an enterprise and across the value chain. Related data may include organizational data, such as roles, responsibilities, and authorizations. It also may include, business relationships, such as dependencies, rules and constraints. Cloud computing has the strong potential to leverage centralized resources to manage and maintain all aspects and phases of design and design analysis. The right security measures, including user access and identity management, and data protection, and isolation, are required. With a centralized cloud environment, major manufacturers and their suppliers and partners can realize greater efficiencies and improved time to market. Remote access to centralized resources is a critical component.

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Where current technology limits global reach, design content can be strategically placed in geo-centric data centers, or pulled when necessary to support efficient daily operations.

Enterprise collaboration and the workplace of the future

The notion of a workplace has changed. Work is increasingly performed over the cloud on the business premises of partners and suppliers, at home or even in coffee shops. To simplify, automotive companies need to expose internal resources to any user, from any device, from any location. Cloud applications that make the most of web technologies will make device-independent, security-rich access to a unified, global enterprise possible, whether the access is from inside or outside the corporate walls. The automotive industry must adapt to the changes in consumer technology. The ever-increasing diversification of mobile devices and computing platform options (iPhone, Android, Microsoft Windows mobile) mean that increasingly, employee-owned smart phones and laptop computers are making their way into the workplace of future. Otherwise known as bring your own device (or BYOD) the devices often have built-in connections to cloud services. In response, automotive companies need to remove barriers to collaboration by providing integrated tools over the cloud that make it possible to share business information using multiple technologies and devices inside and outside of the corporation. Enterprise collaboration must simplify communication by seamlessly combining the available communications channels with anywhere/anytime connectivity using cloud technologies. Automotive companies need capabilities to: Connect people, suppliers and other businesses using instant messaging through chat, voice, video and desktop sharing.

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Understand colleagues availability and location using a wired or wireless presence. Create communities and collaborate in online team rooms and search for other workers based upon skills, projects and communities of interest. Gain access to shared files from anywhere.

Manufacturing and plant floor considerations

Automotive manufacturers need to keep costs down, yet they are confronted with diverse challenges related to production volume, quality and time to market. Cost concerns also have to be balanced against the desire for recalibration of global demand, built-in quality (versus inspect for quality) and plug-andplay plant service. The maturity of the market in terms of volume and the continuously growing competition drives automotive manufacturers to improve their profitability in every area, especially their plants. In addition, automotive manufacturers face growing complexity in their business connections, which include suppliers and partners who must cooperate to achieve required production levels. This complex environment has to react to the extremely demanding features of the automotive market, where a high variety of products, short time to market, quality and strict compliance regulations have led to heightened management of manufacturing business processes. The automotive market continues to experience consolidation and globalization that leads manufacturers to overcapacity and strong price competition. Improved efficiencies in every area of the engineering and manufacturing process are needed to Because of these challenges, the automotive organizations need a modular platform that can provide key capabilities in the manufacturing landscape across plants, including:

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Synchronization between manufacturing and business systems through interoperability Standardization of processes Production performance Integrated quality and quality data monitoring Transparency, efficiency and responsiveness Complete part traceability Increased throughput and better delivery performances Better quality management Plant operations analytical and reporting capabilities

Global expansion
In the automotive industry, the global network of vendors, employees, partners and dealers is a reality. Each entity expects instant collaboration and a common platform for manufacturing, distribution and product development that can be provided through cloud technologies. The worldwide labor force is changing and will become radically different in terms of age, location and work habits. Cultural awareness, diversity and adaptation will be the norm. This geographically dispersed global workforce can significantly benefit from cloud technology for sustaining and supporting manufacturing and product development. The joint ventures and the current investments in globalization will be established creating a global infrastructure. Evolving economies and markets will fuel new products, services and business models. The challenge faced by automakers will no longer be to globalize the industry, but instead will center on effective global integration and execution over the cloud. After investments in globalization are established, the challenge will be to execute in this expansive environment, leading to the need for a multiplex workforce. As with a multiplexor in

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electronics, the multiplex workforce fosters the diverse skills and culture that are a byproduct of globalization and unites them into common goals and direction. This new workforce will have important new attributes (such as the ability to work with diverse cultures) and will likely be conversant in multiple languages. The new global worker will also leverage scalable architecture for working virtually over the cloud.

Sales and marketing

The automotive industry is highly competitive. It relies upon sales and marketing organizations to get messages out to consumers. A few years ago, a key communications channel was business-to-consumer (B2C) web sites viewed on a computer, but that approach is no longer sufficient. The core responsibili-ties of sales and marketing are timeless: knowing the customer, defining what to market and to whom and protecting the brand. But how these responsibilities are executed is undergoing an end-to-end transformation. A smarter marketing framework that can drive transformative change is necessary to excel in todays interconnected world. Three new imperatives are critical to fulfilling the responsibili-ties of marketing in an environment where data is overwhelming and customers are increasingly driving the brand conversation. These imperatives are: Understanding each customer as an individual Creating a system of engagement that maximizes value creation at every touch point Designing the culture and brand so they are authentically one. Delivering on these imperatives requires an ability to tap into both the seemingly infinite stream of data and customer conver-sations that permeate every communications channel. In the automotive industry, sales and marketing cant afford to evolve slowly in an era where the customer is constantly changing.

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Social media
Social media also affects automotive sales and marketing as higher percentages of corporate media budgets are applied to social media. Automobile brands have embraced social media outlets in the cloud, such as Facebook and Twitter to promote messages and build direct conversations with consumers. As important as it is to share messages, it is also important to discover what people are saying. To gain this insight, the automotive industry will need to monitor information streaming over the cloud on social media sites. The application of business analytics to sift through these mes-sages can help automotive companies identify what consumers want, identify whether brand messages are resonating with consumers and discover if brand messages are trending up or down with consumers. Business analytics is a powerful sales and marketing tool that affects the profitability of vehicle sales through effective management of cash incentive programs. Capturing web metrics and applying business analytics can help determine consumer interest in incentives being offered. This information can be used to help tune the incentives, such as increasing an incentive amount if consumer interest appears low and decreasing the amount when incentives may not be necessary. Because the automobile industry is extremely competitive, cloud-based business analytics may reduce the time needed to identify changes in shopping trends in response to a competitors latest promotion and shorten the reaction time needed to introduce counter measures.

Cloud computing and the automotive industry

Cloud computing provides dynamically scalable and virtualized resources as a service. The cloud model is especially important when you consider that the investment is considered an operat-ing expense rather than a capital expenditure. Another important driver to cloud adoption is the ability to deploy resources quickly or speed to value,

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which can be crucial in environments like the automotive industry with fluctuating needs that may grow or shrink rapidly. Cloud computing combines these two drivers: both usage and costs change based on user needs. Because of the flexible nature of cloud computing, it can meet user needs from an availability and performance perspective and still keep operating costs low because expenses are based on services that are actually used, as opposed to a capital investment that is based on projections of potential needs. Whether you fully understand all the technical details or not, the crucial question is, What can cloud computing do for the auto industry? Some of the most noticeable benefits that cloud computing can bring to automakers are: Faster deployment of new capabilities. The use of a common repository, combined with scheduling and automation, means that new capabilities can be deployed more rapidly. This is due in part to faster testing and ensuring that tests are thorough and complete (for both unit and integration tests). Improved consistency and quality of new capabilities. A common image repository in which common and reusable images are tested and hardened to ensure consistent, higher quality results. Increased efficiency in the use of IT resources. Significant reuse of existing computing, storage and data resources by simplifying access to them. Faster integration with partners, vendors, customers and suppliers. A cloud-based test environment requires standardization and consistency. This approach makes it possible for external partners, such as outsourced developmen firms to plan test phases more efficiently and confidently, because the environment is consistent and well known. Automotive businesses are using cloud computing to reduce the complexity, rigidity and costs associated with IT, which enables new levels of strategic

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business value for global product develop ment, services, maintenance, marketing and integration with customers, dealers and suppliers. Automotive businesses can take advantage of the power of cloud computing to: Build enduring supplier/dealer/customer relationships Deliver global IT without boundaries Improve speed and dexterity Transform the economics of global automotive industry innovation To deal with these challenges automotive businesses need to focus on: Business agility: Rapidly define and deliver vehicle products and services. Business analytics: Harvest and apply insights made possible by analyzing information for engineering, design, manufacturing, purchasing, intelligent operations to marketing/customer service. Service delivery and management: Optimize and speed the delivery of IT computing resources and services for predictive warranty/repair and product lifecycle management Secure collaboration: Creating an always available and collaborative ecosystem for connected vehicles, telematics and infotainment technologies. Considering the complexity of the world in which they operate, consistency is a challenge for companies in the automotive industry. As the world moves more quickly, the pace of change increases and business leaders are discovering just how expensive infrastructure and people can be.

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