Open Innovation in the automotive industry

Translation in English of this article originally published on February 6, 2020 in French. Courtesy to Anne-Sophie David and Décideurs Magazine

 https://www.magazine-decideurs.com/news/christophe-cazes-novares-nous-materialisons-l-open-innovation-avec-notre-nova-car

In June 5, 2019, Novares, a French industrial group specialized in plastic injection for the automotive industry, won the trophy for the best open innovation strategy at the G20 "Strategy & Management Summit" organized by the group Décideurs

 Anne-Sophie David  What is your definition of open innovation at Novares?

 Christophe Cazes Unlike traditional innovation, which remains secret, even confidential, and carried out behind closed doors, over very long development periods (5 to 10 years) in company labs, "open innovation" is collaborative. The company's dedicated teams join forces with several partners to develop disruptive solutions, radically new products and new markets.

At Novares, we have decided to materialize it in a federative project with Novares teams and our partners. Thus, the Nova Car has become our open innovation laboratory - moreover hosted by one of our partners. We buy a vehicle in production that we radically modify to integrate innovation bricks. It's not a question of adding a collection of POCs [Proof Of Concept], as is usually the case, but of co-innovating all together on new innovative products.

Anne-Sophie David   You are in charge of Novares' innovation strategy. What is your roadmap?

 Christophe Cazes My role is to anticipate the major developments in the automotive sector. In a context where price competition is extremely strong, the only way to seek profitability, and create your own future, is to find new products that meet the new expectations of users. As a tier one supplier to the automotive industry, we must be on active and permanent focus for autonomous, connected or electric vehicles. The self-driving car, for example, could become a real technological bubble offering a different experience. We must also be on the alert for the different uses of the car. They have evolved enormously in recent years, particularly with players such as Blablacar or Uber.

Anne-Sophie David   Many observers compare this revolution in the automotive industry to the one that revolutionized mobile telephony with the advent of the smartphone. Can you confirm this?

Christophe Cazes Yes, I do. This revolution is both technological and habitual. In order to have the most comprehensive vision possible, an approach, which goes far beyond the plastics industry, has been developed to be able to detect new practices and develop the resulting solutions. This is how our open innovation Lab program gave birth to the "NovaCar", a demonstration vehicle that concentrates numerous innovations co-developed with start-ups, laboratories and partners, in an open innovation logic. The strength of this program is to realize real inventions implemented in a "test" vehicle before being presented to the customer.

"The strength of this program is to make real inventions implemented in a test vehicle."

Anne-Sophie David  How did you build this open innovation strategy?

Christophe Cazes It was built around three main mega trends. The first concerns green mobility at an affordable cost to imagine the future of the electric vehicle - as well as drastic improvements to the internal combustion engine - in order to make it financially accessible to all.

 The second mega trend consisted in working on the design of intuitive and secure man/machine interfaces for the user. Indeed, it can be observed that the automotive industry wanted to play with nature in the same way as we played with the telephone, i.e. without taking into account, for example, that using a screen while driving could be extremely dangerous. Whether it is a 3D or flat surface, reducing the number of buttons, we can imagine the future of these interfaces.

 The third and final part of our program concerns new user experiences to design quieter vehicles that take into account the well-being of the occupants, especially the quality of air in the cabin, by imagining different uses.

Anne-Sophie David  What is the status of your "NovaCar" program and your collaboration with start-ups?

Christophe Cazes Our first demonstration vehicle, the "NovaCar#1", was a group of fifteen innovations, the result of collaboration with four start-ups specializing in automotive technology. For the "NovaCar#2", presented in June 2019, ten partners accompanied us and currently the "NovaCar#3", scheduled for November 2020, is being designed with around twenty partners.

More and more start-ups are coming to us because many see it as a way to go beyond what they usually do. I am also very active on LinkedIn to show what Novares is doing in terms of innovation. This showcase is obviously very attractive and we are delighted about it.

Our curiosity is pushed to the extreme, both with our customers to understand their current and future needs, but also at the market level to anticipate major trends, in order to select the right partners. Those who will help us build the car of tomorrow.

Our innovation cycles are very short, fifteen months between each NovaCar, a period during which we go to the customer with our prototype to gather their opinions, hear their critics and improve our knowledge with their “pain points”; this "feedback" is essential to us. This is a very concrete approach that customers appreciate because they are actively and directly involved in the next generation of "NovaCar".

 Anne-Sophie David  You have also created a venture capital fund. What is its role?

 Christophe Cazes This fund was set up at the time of the finalization of "NovaCar#1" because we felt that the four start-up partners would need funds to develop. The group therefore created Novares Venture Capital, a €50 million fund dedicated to investing in strategic partnerships with start-ups with which the group intended to build long-term relationships. Twelve million euros have already been invested. This financing also enables them to increase their legitimacy vis-à-vis car manufacturers because it remains very difficult for these start-ups to integrate their supplier panels.

"We created a 50 million euro fund dedicated to investing in strategic partnerships with start-ups."

Anne-Sophie David  How is your in-house R&D department structured as you increasingly work with start-ups that bring you innovation?

Christophe Cazes Our internal innovation team has not been downsized, quite the contrary. We have seven product lines that cover the entire vehicle. Each one integrates its own innovation team. When we enter into a partnership with a start-up, it is backed by one of these product lines according to its specialization. There is no competition between internal and external but co-construction, and it works. We are convinced that this is the meaning of the story.

Anne-Sophie David  When it comes to protecting industrial property, how do you work with start-ups? 

Christophe Cazes We try, as far as possible, to reach joint development agreements with start-ups [JDA for "Joint Development Agreement", editor's note], to lay the foundations of our partnership and avoid any misunderstandings. This transparency allows us to protect ourselves against the risks of attacking our industrial property, and therefore our added value. As our strengths are disproportionate to those of start-ups, we initially take care of drafting the patents, but we offer to be co-owners.

Our commitment to the end customer, namely the car manufacturers, is to bring them an innovative product in complete safety. Our relations with our partners and especially with start-ups must therefore be very clear, healthy and safe. To achieve this, our patent department works closely with law firms in order to secure the drafting of technical specifications.

Interview by Anne-Sophie David