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having diffi culty establishing standards.2
But even without them, individual players
and the communities of companies that
supply each major automaker can work
on improving the reliability of embedded
software and, therefore, the quality of the
auto itself.
Building better software
Improving software is a responsibility that
automakers must share with the component
suppliers they rely on for many of their
systems. McKinsey is conducting research
into the economic impact, on the automotive
industry, of complexity and design choices
in embedded software, as well as engaging
in discussions with leading executives at
automakers and their suppliers. This work
suggests four key areas where concerted,
cooperative efforts could substantially boost
the quality of embedded systems and the
productivity of their development.
2 Autosar is a standards body representing about
35 automakers and suppliers, with the goal
of establishing common, open standards for
electronic systems in automobiles. Jaspar is a
similar standards organization for Japanese
automakers and suppliers.
5
Reduce the complexity of features
Anyone who has fl ipped through the 500-
page instruction manual accompanying
a new car knows that automakers add
more features every year. The industry
should look hard at the value each of them
adds to a car, since their complexity has
major implications for quality ratings and
warranty costs. Our research suggests that
productivity in small-scale projects (up to
300 feature points, according to the metric
we use to express complexity) is three times
higher than it is in large projects involving
more than 3,000 features.
Automakers should analyze the way
consumers and ratings organizations
evaluate features and then design cars to
meet these standards without additional
complexity. An airbag supplier, for example,
recognized that airbags are judged by the
number of stars they receive in the New Car
Assessment Program (a global standard of
safety and quality), so the company focused
on software features that would be visible
in the test. This move limited the scope of
development and allowed the company
to beat competitors to market with new
designs and avoid needless complexity.
Adopt a more mature software architecture
Good software architectures—the patterns
or frameworks that underlie software
design—are modular, with a well-organized
system of layers, as well as libraries of code
that allow developers to reuse components.
But in practice, many embedded-software
developers rely on architectures that
have grown up incrementally and
often haphazardly, resulting in what is
sometimes called “spaghetti” code. In fact,
our research fi nds that the architecture
of embedded software is one of the
weakest spots of its development, lagging
half a grade behind the development of
comparable traditional software.3
This shortcoming must be corrected, since
the maturity of software architectures has a
big effect on productivity: more mature ones
are more modular and standardized, reuse
components, and have fewer point-to-point
interfaces. Our research has found that
moving from one maturity grade to the next
can make development efforts 2.5 times
more productive (Exhibit 2). In most cases,
the improvement comes from abandoning
an existing platform and then adopting a
more developed architecture as a corporate
standard. With further improvements—
leveraging standard operating systems,
hardware, and integration platforms—
developers of embedded software could
aspire to the level of productivity that
traditional PC software developers now
achieve. A telecom-equipment company that
switched from its proprietary system to an
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