Developing hardware the software way

Imagine if somebody asked you: Is it possible for a software developer with no automotive experience to design and build a revolutionary and roadworthy prototype for a car in just three months? And is it also possible to do this with hardly any money and by using a team of volunteers connected through social media? You would probably answer that they are out of their mind! However, in an industry where manufacturing processes are long (two and a half years for a so-called fast-track project), costly, and cumbersome, Wikispeed – an open-source organization founded on open innovation and agility – managed to turn all assumptions about manufacturing processes in legacy industries on their head.

Wikispeed was created by software developer Joe Justice in 2008. It was born from his dream to design a new prototype of an energy-efficient car for the 2010 Progressive Insurance X Prize, a $10 million innovation contest in the United States. At first, he worked alone, but he regularly blogged his progress online using social media tools, quickly attracting volunteers to the project. By 2010, Wikispeed had gathered 44 volunteers who managed to produce an attractive, highly efficient prototype within a three-month time frame. With practically no funding and little experience, they tied for 10th place in the mainstream class at the contest, outdoing well-funded companies and universities such as MIT, Toyota, Tesla, and others. Following positive press at the contest, Wikispeed grew to 500 members in the next few years. By 2013 they had sold nine prototypes.

When Martin Kupp, associate professor at ESCP Europe; Linus Dahlander, associate professor at ESMT; and Eric Morrow, entrepreneur in residence at the University of Oklahoma, read about the Wikispeed story, they immediately knew it contained ripe material for a case study on innovation management. “Executives were telling me they were coming under more and more pressure to speed up and open up to be able to develop faster and become more customer-oriented,” explains Kupp. “I could see that Wikispeed addressed a lot of those issues currently confronting those looking for innovative solutions to traditional management processes.” It also offered an opportunity for the authors to take an innovative, new approach to case study writing; the authors signed up and became members of Wikispeed.

What interested Kupp, Dahlander, and Morrow most about this story was the way in which Wikispeed applied innovative management practices from the world of software development − Agile and Scrum − to hardware manufacturing processes. These are practices that combine disciplined execution of high-level intellectual work with fast-paced innovation, involving constant incremental changes. These practices originally arose from a frustration with the command-and-control and reporting issues in large innovative companies. Dahlander says, “What made Wikispeed so fascinating was that while they were in some ways simply reinventing the wheel, so to speak, it was revolutionary in the way they applied these practices to the automobile industry, and also in the way they used open source methods.”

The Scrum and Agile management practices allowed Wikispeed’s self-organizing teams to work independently but within clear working structures. Joe Justice applied the Agile principle of modularity by dividing the car into nine different modules. This enabled teams in different parts of the world to work independently on certain modules and make rapid changes without affecting the overall architecture of the car. It also enabled each team to work swiftly on its respective module without having to wait for others to complete their tasks. This significantly decreased the costs that are associated with the traditional development process, in which the whole process is delayed if a new part needs to be changed. There was no central manager; instead, team members chose what they would like to work on, measured their own performance, and worked in short development cycles of one week (called “sprints”). They communicated their progress to each other using free online tools.

The Wikispeed case study raises the questions: Can – and if so, how can – these practices be applied within traditional manufacturing industries? And what does it depend upon? It also provides students and program participants with insights into the rapid changes taking place in innovation management. Furthermore, it enables informed discussions about the question: How can we become faster, more innovative, and more open? Wikispeed also forces students to look at the value of and limits to the traditional hierarchical management approach, and whether innovative companies require a fundamental overhaul of established management practices. For those who dismiss the Wikispeed way, they would do well to remember the following quote from Joe Justice: “Innovation is a form of variance! So by maximizing the ability to produce the same thing well in traditional companies, we minimize variance using standard manufacturing techniques, with the consequence of also minimizing innovation.”