Why do 4IR technologies matter for the organization of the automotive ecosystem?

Technologies driving the so called “Fourth Industrial Revolution” (4IR) - such as those related to connectivity, 3D systems, and data analytics - are increasingly pivotal in complex-product industries such as the aerospace or automotive ones. The introduction of such technologies may have profound impacts on these sectors in terms of productivity growth, competitive interaction, and value chain reorganization. To shed light on this phenomenon, this study investigates the knowledge base driving 4IR innovation within the automotive industry. The findings show that the 4IR knowledge base and its evolution differ from more «traditional» automotive technologies along several dimensions, including the way actors organize their 4IR knowledge sourcing and creation processes, and protect the outcomes of such processes. Specifically, compared to non-4IR technologies, 4IR inventions tend to be of higher quality, technologically broader, protected across a higher number of countries and more frequently used internally. In addition, compared to automotive players’ patenting in non-4IR technological domains, the 4IR field features a greater degree of competitive turbulence, revealing that the industry has yet to converge toward a stable technological leadership in 4IR technologies and that, at different stages of the automotive value chain, there are several actors committed to advance the field in a dynamic way. These players are mainly large corporates, often US-based and originating in the field of Industrial, Electric and Electronic Machinery, Communications and Business Services. This confirms that the opportunities associated with 4IR technologies might trigger relevant changes in the current organization of the automotive ecosystem. Managerial implications for automotive incumbents include: 1) Recognize the differences between 4IR technologies and “traditional” automotive technologies: learn how to best organize the knowledge creation process to create leadership in these emerging domains. 2) Capitalize on existing integrative capabilities: continue to invest in the systems integrator role, which bears legal and regulatory responsibility towards customers and public authorities. 3) Look outside of the industry’s knowledge base: potential new players represent a competitive threat but are also an important reference point to automotive incumbents, both as sources of knowledge used to generate 4IR inventions and as partners in R&D collaborations.