1. Recommendation 1-1. We recommend 3-series touring wagon development project as a target of Digi tal Car Project.

The ultimate objective of the project is to halve lead time of product development in BMW from 60 months to 30 month. As a result, the firm can incorporate reflect fickle customers tastes and the latest technology to their pro duct development quickly and it enable them to fit the market needs strategicall y. If this change is successful, the experience and knowledge can be transferred to 7-series and all other new projects. It will make BMW in front of the compet ition. And it will save huge money and time of the firm. 1-2. Digital technology, such as CAD, is considerably effective to reduce produc t development lead time even in other competitors. Considering digital technolog y as hardware, its directions and capability of staff operating the technology, however, might be critical issue on product development using digital technology . Moreover we should not ignore the fact that the capability and experience woul d be brought as a result of learning and accumulated experience and knowledge. 1-3. 3-series touring wagon will inherit platform and basic design concept from 3-series sedan. Fortunately the current 3-series sedan has been developed throug h computer design process. Therefore, it can be thought that there is some accum ulated experience of product development using computer design. Additionally, th e staff had realized its untapped potential as strategic product development too l. In other words, by adopting the development project as pilot experiment of th e digital project, we think that BMW can accumulate and develop the competences for learning and adapting new process. 2. Rationale There are several reasons for us to make such recommendations. 2-1.BMW has not experienced revolutionary change in the product development proc ess, which can be proven by the fact that BMW had only changed their development process twice in the last 40 years. As a result, staff at the operational level may not be able to adapt to the new digital project easily and quickly. They do not have rich experience of change and they do not have clear plan that tell al l the managers and developers what they should do in the new scheme. There might be some intense pressure within the firm. It is not the technology problems. Th e development of new capabilities and changes to processes and organization will bring the confusion to staffs and uncertainties to the firm. Therefore, pilot p roject should be conducted by use 3-series. 2-2. Senior managers should fully consider and anticipate the outcome of any str ategic change. If BMW really uses the latest and revolutionary 7-Series platform as a breaking-point for the new digital technology, the whole development team will b e pushed towards the ambitious goal, which may cause demoralization amongst the developers and engineers. Moreover, there seems no way back if the project canno t be implemented as planned because the project would serve as a psychological R ubicon. And if the change not successful as the firm expect, it will ruin the cu rrent good condition of the firm and cause the production processes slower than before. Even worse, they will lose part of market share. In our point of view, s enior managers should avoid to make such a ruthless and aggressive decision when the company is running successfully. We appreciate the necessity and significan ce of changing but it would be highly risky to corner yourself. 3-3. In a purely technological perspective, it is a more appropriate idea to mak e changes to derivative 3-Series than 7-Series. 7-Series is still at the early s tage of its development and there would be quite a few technological problems oc curring in the later processes. If BMW uses 7-Series, probably everyone will be too busy with the other technological problems to pay enough attention to the di gital process itself. In this experiment, the impact on the result from one vari able (the new digital process) would be ambiguous because of other variables (th e other technological problems). Whereas, if the derivative 3-Series is the subj ective in the experiment, there will be no such ambiguity because most of its te chnological problems had already been solved. How effectively and efficiently th e new digital process can shorten the development period will be measurable. 3. Implementation BMW will adopt concurrent engineering in the new project will be to shorten the

development lead time. However, the real objective is not just to synchronize th e activities in the project, but also it is to promote and increase interaction among the concurrence activities to increase accuracy of problem identification and solving, namely the capability of front loading. Thus, by promoting the inte raction in more efficient way and increasing the competency of problem solving i n the project. 3-1. Frequent and periodical meeting between different teams, and in the each te am. When conducting different activities simultaneously, a change in a team might af fect to different activities instantly. Therefore, the team managers should meet up to check the progress and change of others. Moreover, they should understand each other s activity. For instance, design division should consider what kind of c hange affect the specification on production engineering division, and vice vers a. The managers also feedback the information and educate their team staff. Ever y project team and staff needs to understand and realized potential cross-functi onal problem as early phase as possible. 3-2. Dedicated project team The staff will be busy to daily activities, therefore the dedicated project team to manage and establish front loading concept in the whole project. The team sh ould supervise the project broadly and consider enablers and obstacles of front loading with cooperation of each division managers. 3-3. Data sharing through intranet and database. Digitalized data would be the huge advantage of this project. By sharing the dat a through intranet, each team can grasp other s progresses and changes which might t heir tasks instantly. Moreover, the data and other information (requests to othe rs, case of problem and its solution) should be accumulated in the database. It will be strategic knowledge to increase the capability of problem solving in the future. 3-4. Targeted lead time This project is the first challenge and pilot experiment for front loading (FL). The ultimate targeted lead time will be 30 months. At this stage, however, the first priority should be to foundation and to foster capability of FL. Consideri ng the term for capability building, more than 30 months, for instance around 35 month, might be practical. More specifically, 15 months should be spend for con ceptualization and design, and 20 months also should be devoted for development and engineering. The Conceptualization and design phase have been the sections s pending the longest lead time because of using physical prototype. However digit al design will dramatically change the situation. Therefore, it would not be dif ficult to halve the concept and design phases from 30 to 15 months. Moreover the 5 months included in the 15 months is for foundation building for FL. Ultimatel y it will be reduced by 10 months, and will contribute to shorten the whole lead time. 4. Risks 4-1. For BMW, not all problems can be solved via digital simulation. For example , BMW s multiple surfaces that could not be easily created on a digital computer. It have been vantage in ther product craftsmanship .development. Although the digi tal computer design and crashworthiness can save a lot of time, BMW still need t o make sure they can keep their traditional advantages such as multiple surfaces . Thus, it needs effective meetings to discuss which method should be used for t he problems. 4-2. Define the time range for change. Quicker change will not have clear plan a nd preparation. It will destroy the whole thing and waste additional time to sol ve problems. In contrast, slower change also will bring the implementation probl ems and market erosion. For implementation, the more time they use, the more neg ative motion will occur in the employees. And at last, they will not do it. For market, the more time they take, the more risk to fit customers tastes. They nee d careful consideration about. 5. Alternatives The alternative for the project is to use the new digital development process up on 7-Series with more time dedicated. The change is more an organizational chang

e than just a technological change. Therefore, we think it is brilliant for BMW to let the application of a new technology pull the trigger of an ultimate organ izational change within the whole company. 7-Series are the most important produ cts of BMW, which means any change to the current designing processes will defin itely draw employees attention. To conduct the change under a larger time scale wil l offer BMW a real opportunity to change the whole company.