The vehicles of today are extremely complex. They are essentially mobile computers with millions and millions of lines of software code. This complexity will only increase as customers demand more smartphone-like functions and, of course, automated driving. Which is why automakers are also quickly becoming software companies. The Volkswagen Group has identified these challenges and appointed Christian Senger as Head of Digital Car and Services for the entire company. All of its brands' software development is now under one roof with Senger in charge.

It's a revolutionary organizational tactic neither VW Group nor any other automaker has ever done. In short, VW is homologating all of its software systems into one.

"(One of our aims is to) ramp up from 10 percent software code to 60 percent. But it's also a ramp-up in how we collaborate inside Volkswagen," Senger explained during a roundtable discussion at the 2019 Frankfurt Motor Show. "Software is extremely complex nowadays and becoming even more so. Each function is connected with everything, in the car, in the cloud, with the dealers."

Senger has also been tasked with simplifying the software supply chain. "The process chain is not stable anymore. There's too much inefficiency. This is a new software team. In mechanical engineering, I call us a platform champion. The VW Group currently has eight platforms. We have defined how global industrialization of brands and markets really work. In software, there's no reason to have eight different architectures. Having the same operating system in all cars is just logic."

This radical re-think also requires fewer employees simply because, well, there will be fewer vehicle software control systems. "We have 10,000 people doing software for the whole (VW) Group. Customer expectation is for more individual customization," Senger explained. "Today, we buy hardware and software in a package. Up to 70 ECUs means up to 70 suppliers. In addition 200 software partners. This is a huge mix. We want to reduce the number of suppliers."

VW has made the strategic decision to develop more software internally instead of outsourcing. "We are doing 60 percent of software on our own. We gain efficiency with less suppliers. We are spending huge sums in just troubleshooting. Investing in a one cloud approach instead of many."

At present, VW has "11 million cars on existing architectures" and is working on building new architectures. Once this is done, the company will "phase out the old ones… and go for one team behavior with one software stake. One cloud approach. One data analytics. One automated driving for the whole group, but scalable."

But hang on. Does this mean the exact same software, such as the infotainment system, will be found in a VW Golf and, say, and Audi A8? Not quite, as Senger added "this does not mean we put the most expensive stuff in a (VW) Golf. But rather we learned scalability is possible." There will be one software platform for each brand but one operating system in all cars. Think of it like this: this software homologation is both a tech and organizational solution. There's now a software development division within the Volkswagen Group.

"Nobody is doing this up to now. We are separating hardware from software. Customer satisfaction is more dependent on software. It's a natural step to change the organization and focus on software as a core competency of the next stage." Senger said.