5 Principles of Software Development in the Automotive Industry

It is no news that the automotive industry is getting bigger, better and more complex. The automotive industry is one of the most important economic sectors by revenue. Even though most parts of an automobile are hardware, change is predominantly driven by modern software implemented into vehicles. The software changes many areas of customer experience via car connectivity features, infotainment, and smart driver assistance.

Under the conditions of a great focus on innovation and fierce competition in the automotive market, there is a need to bring products to the market as soon as possible. The truth is, tradition approach to software development when defined work packages are delivered by a specific deadline halts the release. This is why automotive IT development companies take up alternative development principles to decrease time to market, improve quality, reduce cost, and increase the functionality of the software. Below are the top 5 principles used in software development in the automotive industry.

1. Lean software development

5 Principles of Software Development in the Automotive IndustryLean principle deals with continuous improvement of processes and elimination of waste. It offers a proven method to eliminate non-value added activities from processes with the aim of reducing operating costs and improving productivity. The five basic principles of lean software development are:

  • Identifying values from customer’s perspective
  • Specification of how every step and process contributes to the end goal
  • Creating flow by a careful analysis of each step in the process and introducing ways to maximize efficiencies and reduce waste
  • Optimizing to produce the product customer actually needs in the time when he needs it
  • Continuous improvement of the processes with the aim of achieving perfection

Lean principle stipulates that processes either add value or waste to the production. Thus, it is very important to understand what would be classified as a waste and where it would be found. When these wastes are classified and found, it is necessary to develop a strategy to reduce its effect thereby leading to an improved overall performance. Categories of waste includes overproduction, waiting, unnecessary inventory, defects and so on.

Lean prioritizes making continuous improvements instead of rapid, abrupt, and irregular changes that might be disruptive to the overall process which would lead to time and materials waste. It uses Layered Process Audits (LPAs), a process that requires multiple people to conduct simple verifications to ensure that a defined process is followed correctly. LPAs improve quality and reduce costs by making continuous improvement all most every time the LPAs routine is followed. Another powerful lean tool is Value Stream Mapping (VSM) that helps to allight processes to goals across the entire development process.

Lean principle is popularly used for tier 1 automotive suppliers and gives them the ability to maintain and  improve quality. Tier 1 suppliers are companies that supply parts of systems directly to Original Equipment Manufacturers (OEMs). They usually work with a variety of automobile companies but have a close relationship with one or two OEMs.

2. Agile development principles

In agile software development model, the software is not developed and tested as a whole but, instead, the development processes are separated into sub-tasks. These sub-tasks are developed, tested, evaluated and returned back to engineers for updates. Using agile method, errors can be easily identified, corrected and the entire products can be validated on time.

Using agile method, automotive companies are able to react fast to market demands while reducing the time to market of a new product, which places them in a better position to compete.

The three drivers for agile implementation include efficiency, effectiveness, and steering. Agile software development presupposes short development iterations, self-organized and cross-functional teams and getting customer feedback on the stage of development and revising processes accordingly. With Agile development, feedback cycles become short with frequent communication between customer and vendor teams.

One of the main benefits of agile for automotive is Continuous Integration and Continuous Deployment (CI/CD).  Continuous Integration and Continuous Deployment (CI/CD) helps to reduce a product’s time to market and improves the product’s quality with each iteration.

With an agile approach for software development, automotive companies can:

  • Decrease time to market
  • Increase cost efficiency
  • Build products based on customer’s need
  • Increase product quality
  • Handle complexity

3. Waterfall principle

Software Development in the Automotive IndustryWaterfall software development is a sequential (non-iterative) software development model  where each phase – conception, initiation, analysis, design, development – is executed according to the specified schedules. It is a good model for industries with simple and direct processes. In a waterfall model, there is a breakdown of project activities into linear sequential phases, where each phase depends on the deliverables of the previous one and corresponds to a specialization of tasks. Waterfall model is commonly used by startups with simple tasks.

4. V-Model principle

V-Model is also known as verification and validation model and is based on the association of testing phase for each corresponding development. In this model, for each development activity, there is a testing activity corresponding to it and each phase starts only after the completion of the previous phase. Testing in the V-Model is done in a hierarchical perspective.

Most companies use this model because it is easy to manage due to the rigidity of the model and because it allows for a proactive defect tracking. V-model has the flexibility to accommodate any IT product irrespective of its size, complexity, or duration.

5. Iterative and incremental principle

In the iterative and incremental  principle, there is a gradual increase in features. Iterative and incremental model follows a cyclical release and upgrade pattern. In incremental development, different parts of the software are developed at various  rates or deadlines and are integrated based upon completion. In iterative development, development teams schedule revisiting parts of the system to revise and improve them based on the identifies issues or customer feedback.

This principle offers a greater ability to incorporate changes into the application during the development cycle. In addition,  it is  easier to manage, because bugs are identified and handled during the early stages of development.


All customers want value and are ready to pay if the value of products and services meets their needs. This is why automotive companies need to discuss what principle an automotive IT company will use for software production and how this software development model will help meet their needs. Using new approaches to software development is of great benefit to automotive companies, customers and the entire economy.