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The automotive industry is under increasing pressure from disruptive technology, increased competition and changing consumer behaviour. With analytics capabilities evolving over recent years, the industry is relying increasingly on advanced analytics to improve efficiency and profitability, and deliver competitive advantage.
What are the opportunities for OEMs?
Across the entire automotive value chain, the use of analytics to make sense of data, drive insights and automate decision making is adding value in terms of driving operating margin, revenue growth and asset efficiency.
As seen in Figure 1, developing analytics’ capabilities from the traditionally descriptive to include diagnostic, predictive and prescriptive analysis will equip organisations to make more informed, faster decisions.
Figure 1. The four analytics capabilities
The potential value created through the use of analytics is huge. For example, the use of advanced analytics to categorise warranty claims and identify and predict future issues could save an OEM between 15 per cent and 20 percent of warranty costs. For a large OEM group with a revenue of £100 billion, spending 1 per cent of revenue on warranty, this can mean a saving of £150-£200 million per year.
In this report, we identify three high-value use cases that are based on clearly defined challenges with tangible business outcomes. For each use case, we identify the business challenge and the value it can create, and the analytical approach needed to build and effectively deploy the solution.
How to deliver success
Given the massive potential, organisations throughout the automotive industry are looking at how best to invest in and exploit the opportunity. This report identifies key factors in delivering a successful project and suggests viable next steps for organisations regardless of their existing analytics capabilities.
For example, organisations should create an environment where talent can thrive and build its analytics capability around five dimensions: strategy, people, process, data and technology.
Figure 2. Becoming an insight driven organisation
The report authors discuss how advanced analytics can help transform auto businesses by improving operations, developing new offerings, and providing better customer service. Download the report in full now.