Today's guest commentary is by Klaus Felser, Senior Advisor TPI Germany.
The prospects for the automotive industry are many and varied - and in Germany, in particular, a vital economic factor. No other 
country has such a density of established automotive companies. Despite this, BMW, Volkswagen, Porsche, Audi and Daimler all have to hold their own on today's world market. At stake is the development of markets with high growth potential, such as China (car production rose by 38% there in 2006 while the United States registered a decline of 6%) and India. At the same time, in more established markets it is necessary to contend with rising crude oil prices and deploy mitigating strategies to remain competitive.
What does this mean for the role of the CIO in the automotive industry?
The pressure on corporate IT strategy and delivery is increasing, especially in this business sector: cost pressure and complexity are increasing, while at the same time processes are being accelerated. Although in recent years it was primarily a question of realizing IT operations at a low cost to create room for innovation, today far more is required. It is now necessary to internationalize IT to have recourse to global production locations, make better use of more favorable procurement markets, optimize IT vertical integration and finally implement interdisciplinary processes. In times of tougher cost calculation and under the pressure of dwindling resources, the challenge for IT is becoming ever greater. As a result, today's CIOs are much more: in their role as procurement managers, they have to standardize and consolidate departments. The high number of IT service providers in individual countries must be reduced to a manageable number of important strategic partners. It is a question of achieving centralization and global system solutions. Where can the best services be sourced, what standardization can be applied to allow a focus on core competencies in IT. A great transformation is imminent and IT will once again be the driving force.
What should be kept in mind?
- A strategic perspective on outsourcing and insourcing focusing on the overall advantages, comprising the costs, capabilities and capacities will become increasingly important for successful sourcing strategies.
- The capability to offer new and innovative services to support company goals and the ability to access flexible sources of talent and infrastructure will be just as important for the experienced outsourcer as cost improvements.
- The service providers who are best positioned for the future are those who, based on reasonable customer relationships, invest in industry-specific solutions and have important customers utilising industry-specific offers.
The global automotive industry remains a growth industry, but in times of environmental and climate protection it must reorganize and look at new ways. A CIO who recognizes this today will be in a position to make progress tomorrow. No surprise? Surely yes, when one observes how many companies are still lagging far behind in putting this into practice. Even if the automotive industry was a pioneer in outsourcing manufacturing, this lead position does not yet exist in IT.
