Bmw Ag: the Digital Car Project

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REV: NOVEMBER 1, 2001

STEFAN THOMKE

BMW AG: The Digital Car Project (A)
“Looks great,” thought Chris Bangle as he walked by a picture of the new BMW 3-Series which was about one year away from its scheduled 1998 launch in Germany. Bangle, a former Wisconsin native, who became the company’s director of worldwide design at age 35, glanced at his watch. In just 30 minutes, he would meet with other senior managers about project recommendations that might revolutionize the way cars had been designed over the past eight decades at BMW. The meeting was in the inner sanctum of BMW’s research and engineering building, the Forschungs-und Ingenieurszentrum, known locally as the “FIZ” (pronounced “fits”). Built in 1987, this massive building centralized the work of 40 facilities previously scattered through Munich. All work from product concept to pilot production occurred in the FIZ. But only a privileged few out of the five thousand who worked in the building had ever visited this corner of the company where the meeting was to be held. Bangle pulled out his card key that would let him pass through a sleek space-age security system that resembled an oval chamber. After negotiating a push card entry system, a set of doors slid close behind him and another set opened up to reveal the styling area—a world of future visions, inhabited by many life-size clay models of cars under development that would eventually come to life on roads of the next millennium. BMW had weathered several storms over the past century, almost spluttering out of business thrice. On one humbling occasion in the firm’s early history, it survived by using its machinery to manufacture cooking pots and pans. Now BMW rode high, outperforming many other European auto manufacturers. It had become one of the few European companies consistently making both cars and profits. Yet, BMW had one of the slower product development cycles when compared to its international competitors—a problem if it wanted to retain its technological leadership and cater to fickle customer tastes. Thus far, BMW’s cars had been designed along the lines of fine Bavarian craftsmanship that stretched back for centuries. Designing BMW cars had involved months and sometimes years of painstaking iterations between hand-drawings and hand-built clay models. This process was especially belabored during the creation of a new car platform, which for a given series was launched only every seven or eight years, as compared with derivative, incremental models that were released every year or so.

________________________________________________________________________________________________________________ Professor Stefan Thomke and Research Associate Ashok Nimgade prepared this case. HBS cases are developed solely as the basis for class discussion. Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective management. Some data has been disguised for purposes of confidentiality. Copyright © 1998 President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800-545-7685, write Harvard Business School Publishing, Boston, MA 02163, or go to http://www.hbsp.harvard.edu. No part of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means—electronic, mechanical, photocopying, recording, or otherwise—without the permission of Harvard Business School.

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BMW AG: The Digital Car Project (A)

Bangle wondered if today’s meeting would help decide about doing away with this almost entirely, and begin work from computer models only as required by the new development system that called for a 50% time reduction. He was sure that many middle managers would cringe at the thought. But the decision that had to be made was one of managing organizational change: how should BMW roll out its new and unproven...
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