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Digital Vehicle Ecosystems and New Business Models ...

Digital Vehicle Ecosystems and New Business Models : An Overview of digitalization Perspectives Christian Kaiser Alexander Stocker Gianluigi Viscusi Virtual Vehicle Research Center Virtual Vehicle Research Center E cole Polytechnique Fe de rale de Lausanne Austria Austria (EPFL). Switzerland 1 from heart bpm value and GPS positions if a sport activity is ABSTRACT performed), which can be transferred to vehicles, too. As The ongoing digitalization of passenger vehicles entails a vehicles capture sensory data about themselves and their rearrangement of stakeholder power relations within the environment during operation and thereby reveal how they are automotive industry. A bunch of innovation-friendly IT start-ups used by a driver, they can become Quantified Vehicles' [44]. - the majority of them from outside Europe - has already put Quantified vehicles represent one key result of digitalization in energy into the development of novel quantified Vehicle services the automotive industry, where incumbents have to face a key for various beneficiaries, including drivers as well as third set of competing systemic challenges spanning from innovation parties, challenging the traditional role of Vehicle manufacturers.

Digital Vehicle Ecosystems and New Business Models: An Overview of Digitalization Perspectives Christian Kaiser Virtual Vehicle Research Center

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Transcription of Digital Vehicle Ecosystems and New Business Models ...

1 Digital Vehicle Ecosystems and New Business Models : An Overview of digitalization Perspectives Christian Kaiser Alexander Stocker Gianluigi Viscusi Virtual Vehicle Research Center Virtual Vehicle Research Center E cole Polytechnique Fe de rale de Lausanne Austria Austria (EPFL). Switzerland 1 from heart bpm value and GPS positions if a sport activity is ABSTRACT performed), which can be transferred to vehicles, too. As The ongoing digitalization of passenger vehicles entails a vehicles capture sensory data about themselves and their rearrangement of stakeholder power relations within the environment during operation and thereby reveal how they are automotive industry. A bunch of innovation-friendly IT start-ups used by a driver, they can become Quantified Vehicles' [44]. - the majority of them from outside Europe - has already put Quantified vehicles represent one key result of digitalization in energy into the development of novel quantified Vehicle services the automotive industry, where incumbents have to face a key for various beneficiaries, including drivers as well as third set of competing systemic challenges spanning from innovation parties, challenging the traditional role of Vehicle manufacturers.

2 Capability, focus, and governance. In particular, digitalization has They gather data on how vehicles are used and offer Digital enabled Digital entrepreneurship [36] providing less bounded products and services exploiting this data. Thereby new Business entrepreneurial processes and outcomes and less predefinition in Models have been created within the automotive industry, entrepreneurial agency, as shown also by the rising number of causing an interesting power struggle between the various start-ups focusing on quantified vehicles [24,45]. stakeholders. This paper provides a short overview on the role of Considering the development process of successful Business the digitalization phenomenon in general, the impact of Models based on exploiting Vehicle operation data, there is digitalization in the automotive domain through quantified currently a friendly competition between the major players from Vehicle start-ups and new Business Models , as well as a brief Information and Communication Technology (ICT) industry investigation of the position of Vehicle manufacturers and their against the Vehicle manufacturers on the supremacy of Digital Digital service strategies all of them concluded in a comparison Ecosystems .

3 ICT start-ups have already successfully transferred of value creation for Business model elements. the quantified-self [37,47] phenomenon to vehicles and have launched apps and services to generate a whole new market, CCS CONCEPTS while Vehicle manufacturers are currently in the transition Social and professional topics Professional topics process from Vehicle manufacturers towards integrated mobility Computing and Business ; Automation; Economic impact and data service providers [24]. Thus, the Digital ecosystem for the incumbents and start-ups, which are competing in the KEYWORDS quantified vehicles market, have to consider industry transformation in general, impacting on the overall Digital Digital Vehicle , Quantified Vehicle Services, Vehicle Generated information assets available as well as on the sustainability of Data, Connected Vehicle , Business Models , Digital Business Business Models . Innovation This paper aims to explore different approaches on developing platform oriented and sustainable Business Models for the 1 Introduction occupation of Digital services, probably the most lucrative digitalization is an important driver of service and Business components in the future automotive industry, between the model innovation in the Vehicle domain.

4 digitalization incumbent Vehicle manufacturers and the emerging tech start- challenges are currently often subsumed under the more popular ups. In particular, this paper aims to identify the main actors and term connected vehicles'. Taking a look on Digital services and roles in emerging Digital Ecosystems of Vehicle usage data mobile applications, it emerges that connecting vehicles closer to platforms and their contribution to eventually define an their human drivers is an increasingly requested topic of information infrastructure for an automotive industry centered research. Such include the detection of behavioral patterns around quantified vehicles'. from data collected during self-tracking activities ( conclude After this introduction, the paper will provide a summary on digitalization as well as its implications for the automotive Platform Economy & Business Models workshop at i-KNOW '17 October 11 12, 2017, domain ranging in Section 2, whereas Section 3 outlines the Graz, Austria Copyright 2017 for this paper by its authors.)

5 Copying permitted for applied research approach. Section 4 discusses relevant Digital private and academic purposes. challenges of Vehicle manufacturers and the increased i-KNOW'17, October 2017, Graz, Austria C. Kaiser et al. competition on the way to Digital services including recent are currently in the transition process from Vehicle activities within the startup ecosystem. Section 5 concludes with manufacturers towards integrated mobility and data service an outlook and a classification of value drivers and Business providers [24,45]. Yet, the Digital ecosystem for the incumbents model elements for each stakeholder investigated in this paper. and start-ups competing in the quantified vehicles market have to consider another industry transformation, impacting on the 2 Background and Motivations on digitalization overall Digital information asset available as well as the sustainability of Business Models . digitalization is a sociotechnical process that leverages the At the state of the art, the need to build on an appropriate ICT.

6 Technical process of the encoding of analog information in a infrastructure, the open system integration of the energy Digital format (digitizing) applied to broader social and landscape led to its definition as Internet of Energy [5,27]. As a institutional contexts, transforming their sociotechnical consequence of the Internet metaphor, the energy related structures, thus rendering Digital technologies infrastructural challenges and concerns have been alternatively interpreted as a [48,58]. Furthermore, digitalization depends and results in Digital consequence of lack of information to enable and motivate artefacts characterized by attributes such as editability, economic and behaviorally driven solutions [55]. Consequently, interactivity, reprogrammability / openness, distributedness [25], energy informatics (EI) has emerged as a new field within also implying a shift in product design moving from modularity information systems (IS) research to analyze, design, and to generativity [29,56,57].

7 Implement systems increasing the efficiency of energy demand Quantified vehicles represent one of the key results of and supply infrastructure [55]. According to Dedrick [16]. digitalization in the automotive industry, where incumbents researchers have framed the impacts of IT on the environment as have to face a key set of competing concerns systematically first, second, and third-order effects: interrelated as shown by Svahn et al. [46] through the case of Volvo: innovation capability (existing versus requisite), First-order effects: direct impacts from IT hardware innovation focus (product versus process), innovation during the product lifecycle, including production, use collaboration (internal versus external), and innovation and disposal of computer equipment. governance (control versus flexibility). In particular, it is worth Second-order effects: impacts of ICTs on other processes noting that from a strategy perspective, the digitalization such as transportation or industrial production, enforces internetworking to be considered as those Business influencing their environmental impact.

8 Processes/activities conducted or mediated online by and Third-order effects: are longer term and more dynamic between employees, customers, suppliers and partners of firms, impacts, occurring when widespread use of ICTs leads using internet-based technologies accessed through internet- to changes in lifestyles and economic structures. based infrastructures. [15:224]. Besides incumbent's digitalization enabled by Digital entrepreneurship providing less Third order effects are relevant when considering the increased bounded entrepreneurial processes and outcomes and less use of social media transformative potential for green IS on the predefinition in entrepreneurial agency [36], as shown also in demand side, encouraging better practices reducing the burden the case of the specific industry, we consider a rising number of on the environment such as, , the emerging carpooling and start-ups focusing on quantified vehicles. ridesharing applications impact on transportation coupled with Taking these issues into account, the role of information and its the Internet of things [30].

9 According to Malhotra et al. [30] this value are a central challenge in the competitive scenarios two- way, sensor-driven communication is blurring the emerging from digitalization as well. Consequently a key issue is boundaries between the production side and the demand side. related to evaluation of the Digital information asset of a Furthermore, EI and IS and interdisciplinary strategies for company as well as its information capacity defined as the quantified vehicles may provide Models to assess the value of current stock of understandings informed by a given installed information, in particular the social value of related open data, base [51]. The key questions are: What data do I have? How is the adopting classification frameworks such as the one proposed by quality of data? Can I exploit it in their full potential? What can I Viscusi et al. [53]. infer from it given my current systems? According to Viscusi & Over the last twenty years, actually after the massive access to Batini [51] information capacity represents the potential of a the Internet and the World Wide Web, the interest in the Digital information asset defined and evaluated independently strategy concept of Business model has grown, thus becoming a from its usage, determining not only its economic value, but also key element for competing in markets characterized by extensive the enabling capabilities.

10 Use of ICTs and currently transformed by digitalization . In Considering the development process of successful Business general terms a Business model describes the rationale of how an Models based on exploiting Vehicle data, there is a competition organization creates, delivers, and captures value [39:14]. between the major players from ICT industry against the Vehicle However Business model is a multifaceted concept, still raising manufacturers on the supremacy of Digital Ecosystems . ICT debate in academia as to its definition, Massa et al. [32] provided start-ups have already started to apply the quantified-self a systematic view on the different perspectives pointing out that phenomenon to vehicles and have and launched apps and Business Models can be considered as i) attributes of real firms services to generate a new market, while Vehicle manufacturers (how firms do Business ), ii) cognitive/linguistic schema (how the way firms do Business is interpreted by organizational members).


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