Software lifecycle management is key to accelerated innovation in the era of software-defined vehicles

The automotive industry is undergoing a transformation unlike any seen in its 130-year history. Software-defined vehicles (SDVs), autonomous driving, connected services, intelligent automotive customer experiences – trends like these mean that software is at the heart of the industry’s value proposition.

What’s more, frequent software updates are now mandatory, because today’s vehicles are expected to evolve continuously. Consumers want new features and updates to roll out in cars the way they do on smartphones, so capabilities, performance improvements, and safety patches must all be delivered seamlessly OTA. Digital natives have already shown that OTA updates are a significant competitive differentiator.

To succeed in this new world, OEMs must keep OTA updates in mind from day one of the software development process. That implies:

Development models have yet to catch up with SDV requirements

A major obstacle to meeting these requirements today is that many automakers and tier 1 suppliers continue to rely on legacy development models that are rigid, sequential, and slow.

Their SLM approaches usually embody the old V-model, with its rigid phases and sequential testing, which means that these approaches simply can’t keep pace with the demands of modern automotive software. Trying to manage OTA updates with a legacy SLM approach is likely to result in unacceptable time to market and inconsistent software quality, so that OTA becomes a tactical patchwork rather than a strategic advantage.

What’s more, with these approaches, integrating feedback or fixing bugs can take months once physical vehicle production is complete. That might have worked in the old world of “build and forget,” but it can’t work in the new world of continuous innovation.

The solution: advanced, unified SLM

To achieve their goals, automakers need to introduce a unified SLM approach that embeds OTA and real-time update capabilities into architecture and processes, and that fosters collaboration between functional teams (software, hardware, safety, product, cloud).

This new style of SLM needs to have the following characteristics. It must be based on a hybrid Agile/V-model framework providing speed, safety, and traceability. It must support left-shifting of testing and validation using virtualization and simulation. And it must be part of a wider shift in the company’s architectural focus from hardware to software.

Let’s look at each of these points in more detail.

Left-shifting and virtualization

Left-shifting is about carrying out testing, validation, and verification as early as possible in the development lifecycle, so bugs are caught sooner.

Virtualization makes this possible. Engineers can simulate entire vehicle environments – ECUs, sensors, networks, even real-world driving conditions – before physical prototypes exist. This enables early integration testing of software components, automated regression testing across multiple configurations, and faster feedback between development and testing teams.

Virtualization also allows teams to run thousands of test scenarios in parallel, drastically reducing the time spent on late-stage debugging and physical validation.

Hybrid Agile / V-model framework

Rather than choose between Agile and V-model, the aim should be to integrate the best of both. Agile brings speed, flexibility, and iterative delivery, and enables teams to deliver value in small, manageable increments – perfect for feature-driven OTA updates. V-model, on the other hand, ensures safety, compliance, and traceability – critical in regulated industries like automotive. A hybrid SLM framework combines these strengths. Agile can be used for feature development and iterative refinement (e.g. infotainment, ADAS features). V-model principles can be applied to safety-critical systems (e.g. braking, steering, powertrain control).

In addition, the framework should maintain end-to-end traceability from requirements to deployment, with automated tools tracking changes across all phases. It should include continuous integration and continuous delivery (CI/CD) pipelines with safety gates and compliance checks.

This hybrid model enables rapid innovation without compromising safety or regulatory standards.

Shift of architectural focus from hardware to software

The SLM should be introduced in the context of a more general organizational shift toward a software-centric automotive architecture featuring:

• consolidation of controllers/in-car-compute engines with clear software boundaries
• service-oriented architecture (SOA) enabling modular, reusable components
• open, standardized APIs and communication protocols
• cloud-native development practices for OTA orchestration and analytics

SLM adoption paths

The journey to SLM maturity is about building a hybrid, adaptive approach that can be adopted in phases and then evolve through iteration. To succeed, SLM must be owned by the entire organization, not just software teams. That requires leadership buy-in, cross-function collaboration, and investment in tools and culture.

On this journey, traditional OEMs will encounter different challenges and opportunities from those faced by digital-native disruptors.

With their hardware-centric engineering culture, entrenched V-model processes, and complex, siloed IT and development environments, traditional OEMs need to instigate cultural and organizational changes, as well as technical ones. Indeed, many are already doing so, modernizing software architecture, building OSs, and investing in cloud-native development. Some are creating internal SLM platforms.

Digital natives already have the necessary agility, but may develop technical debt in their systems architecture and, eventually, legacy problems, because of a lack of SLM  rigor. As fleets grow to include millions of vehicles, these companies too need robust SLM backbones to manage software updates across diverse hardware variants, ensuring safety and compliance and maintaining backward compatibility.

SLM as an enabler of industry change

SLM and the automotive supply chain

The transformation of the automotive industry into a software-defined, cloud-connected mobility ecosystem is reshaping the supply chain.

Tier 1 suppliers and semiconductor manufacturers are becoming strategic partners in software lifecycle orchestration, and are evolving into system integrators and platform enablers. As well as components, suppliers may provide reference architectures, cloud-based development and testing environments, OTA management platforms, and fleet-wide diagnostics and analytics via cloud integration.

SLM has to be at the center of this transformation, furnishing the common language and governance layer that binds hardware, software, and cloud services together. It follows that SLM can’t be the sole responsibility of the OEM; it needs to evolve into a shared framework, with responsibility shared across the supply chain.

SLM and AI-first development

To take full advantage of AI, automakers will require a hybrid SLM approach that is optimized for AI. Such an approach must combine not only V-model and Agile but also DevOps (to automate software deployment) and MLOps (to automate AI models’ lifecycles through model training, versioning, validation, and so on).

Left-shifting validation and virtualization will be particularly important in the context of AI, because of the need to start training and validating AI models as early as possible in the lifecycle. (AI itself will help with this requirement since genAI can rapidly produce virtual sensor data, traffic patterns, and environmental conditions to be used in model training and validation.)

Modern SLM approaches need to cater for these needs. They must also support AI model certification, version control, and audit trails to address emerging regulatory requirements.

The road ahead

The next revolution won’t be in the car, but in how we create and manage the software that powers it. As the automotive industry evolves into a global mobility ecosystem, the value of software and connectivity will surpass that of hardware. The winners will be the companies that can deliver secure, reliable, and continuously evolving software at scale, rather than those with the fastest chips or the most powerful engines.

It all starts with efficient, effective, SLM, functioning not just in the OEM’s development lab but at every level of the supply chain, and serving as a catalyst for transformation. An advanced SLM approach can bring genuine competitive advantage.

If you’ll be at IAA Mobility 2025, please come and discuss these ideas with us at Capgemini’s booth, B22 in hall B1. Software is one of Capgemini’s major themes for this event, and we’re lining up software-related speaker sessions and demos to help our clients drive their businesses forward into a future of software-driven mobility.