Shifting from a car manufacturer to a software company

Porsche is well known for luxury sports cars. Just two months ago Porsche celebrated the millionth 911 coming off the production line. Porsche cars combine heritage with high-tech. You now probably think of the perfect sports car: beautiful design, best in class performance, a masterpiece of automotive engineering. But by introducing Porsche Connect with the new Panamera last year, Porsche had to shift from a car manufacturer with clear focus on hardware development to a company delivering digital products to its customers. This change had a great impact on organisational structures, mindset of people and of course the way of doing IT business.

Moving from waterfall to agile

At Porsche we had a standardized approach for IT projects: more or less a waterfall approach with lots of documents to write. The business side had to define the requirements, after approval of the requirements specification the IT guys started with technical specification and implementation, finally the software was delivered. For Porsche Connect with a very challenging time constraint and lots of uncertainties we had to change this approach fundamentally.

A small group of people, business and IT, started to push an agile approach. All people needed to develop the software products were organized in cross-functional teams. Writing documents was replaced by writing code and delivering working software as early as possible was the main goal. One of the most demanding tasks was to overcome internal concerns about the agile approach. We had to convince lots of people that it‘s worth to follow the agile path. Beside of training the Scrum methodology, the change of the people’s mindset was a very important enabler for our small agile outpost. Delegating responsibility to the teams, encouraging the teams to make decisions on their own in the best interest of the product and to trust each other was crucial for our success.

Agile at scale

Now we had this small group of people embracing the agile approach. But how to scale this out? We had to deliver a huge amount of features with a fixed deadline and reducing the scope was not an option. Thus we started to setup more cross-functional product teams with specific feature responsibilities. Each team should be capable of delivering features without or little dependency on other teams. Actually we tried to adapt the well known approach of Netflix and Spotify and we had some very inspiring talks with guys from Otto. The more we scaled out the more we struggled with dependencies between the teams and dependencies to the car. These dependencies made us slow and we had lots of trouble because we couldn’t deliver working user journeys as soon as more than one team was involved.

We hade to find a way to reduce these dependencies or to manage them. Getting rid of them was impossible in most cases. For example the car was one of these fixed constraints we couldn’t change. So we decided to manage the dependencies by making them visible for all teams. Furthermore we introduced an agile portfolio which allowed us to align all teams regarding scope and time. With the agile portfolio all teams should have the same goals and priorities in mind when implementing new features. This approach helped us a lot to deliver working user journeys continuously.

Another obstacle was lack of communication. Of course we had our regular meetings. But after the meeting each team went back to work and there was only little collaboration between the teams. A turning point was when we introduced HipChat to enable communication between all teams. This was the starting point for building up guilds. People with the same interests or roles started to communicate via chat. For example the UI/UX guys had a regular chat about the overall user experience. They aligned concepts and designs without any further push from outside.

Enabling communication and collaboration was definitely one key for successful product development. Another success factor is trust and to share the same mindset. We started to have events together with all teams. One very successful event is a product marketplace, where all teams are invited to show the current state of the product and everybody can discuss with each other and share information. Today we reach lots of people across the whole company with these events and it helps us to build up a community for our digital products.


One main thing we learned is that there is no blueprint out there to get an agile approach up and running within an organisation. We had to find our way, the Porsche way, and there were and are lots of challenges. The journey has just begun and there is more to come. Software is getting more and more important for the car manufacturers as customer expectations are changing rapidly. Digital transformation is one key to cope with the future challenges. But besides of technology and methodology it’s all about people, how they feel, how they act and how they work together. A lot of work has to be done in the area of mindset and cultural development and I’m happy to share our experiences in this blog.

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