Understanding the Innovation Process in the Automotive Industry

Abstract

As the automotive industry is undergoing a great technological shift due to automation and electrification, many firms are changing their way of working with innovation. Radical technological developments and a greater focus on software compel industry giants into operating in a more agile way. Because of the ongoing organizational restructuring, discussions regarding appropriate innovation processes within the automotive industry are central for most firms. This study uses Volvo Cars as a case example, to understand how well the current innovation capacity and project management practices work. The data collection has been done through qualitative interviews, which have been transcribed, coded and categorized based on theme and negative or positive annotation. The results show that most innovation barriers occur when trying to diffuse an idea through the organization using facilitators such as sponsors, product champions and networks. Resource allocation for explorative projects are poor while team creation and idea presentations are some of the more successful enablers of the innovation process. Four key elements in Volvo Cars’ innovative work that are in need of improvement and are highlighted in this study are (1) leveraging networks, (2) ability to explore, (3) common goals and (4) experience and knowledge.