DIGITAL IN THE DRIVER’S SEAT:

ACCELERATING TOYOTA’S
TRANSFORMATION TO MOBILITY
SERVICES
Nick van der Meulen, John G. Mooney, Cynthia M. Beath
APRIL 2022 | CISR WP NO. 454 | 26 PAGES

CASE STUDY
an in-depth description of a firm’s approach to an IT management issue
(intended for MBA and executive education)

DECISION RIGHTS/GOVERNANCE In 2020 Toyota Motor Corporation (TMC) was the world’s top-selling car man-
ufacturer. Despite this, the company was being driven to excel further in re-
DESIGNED FOR DIGITAL
sponse to changing consumer expectations, technological developments, and
ORGANIZATION STRUCTURE new kinds of entrants into the automotive industry. Toyota’s leaders sought
AND AGILITY
to accelerate the company’s culture of incremental innovation and realize a
bold new future centered on mobility services. They pursued this by launch-
ing Toyota Connected, a new organization with its own decision rights and
ways of working and a mandate to create new digital offerings for Toyota. In
parallel, a new division within Toyota Motor North America called Connected
Technologies facilitated the company-wide diffusion and commercialization of
the offerings Toyota Connected created. This case describes what it took to
empower the small, independent, agile Toyota Connected and how the entity
collaborated with Connected Technologies to design and scale new digital of-
ferings and new ways of working for TMC globally.

MIT
MANAGEMENT
CENTER FOR INFORMATION
SYSTEMS RESEARCH (CISR) © 2022 Massachusetts Institute of Technology. All rights reserved.
SLOAN SCHOOL
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 2

CONTENTS

Digital in the Driver’s Seat: Accelerating Toyota’s

Transformation to Mobility Services ........................................................................... 3
All Roads Led to Data: The Origins of Toyota Connected...................... 4

Digitally Driven: Getting a New Company Up to Speed ......................... 5

Sharing the Road: Distinct Organizations, Shared Leadership ...... 9

Accelerating via New Ways of Working ..............................................................10
Multi-Capping as a Vehicle for Change Within TMNA ......................12

Guardrails: Empowering and Aligning Teams ................................................. 13

Removing Roadblocks with Minimum Viable Policy ...........................13
Maintaining Momentum with Resources to Run ...................................16

Shifting Up: Scaling Local Innovations for Global Impact .................. 18

Around the Bend: A Software-First Company................................................. 19

Appendix A: Organization and Leadership Structure

of Toyota Connected, 2021 ................................................................................................... 21
Appendix B: Strategic Business Domains of Toyota
Connected, 2019 ............................................................................................................................... 22
Appendix C: Organization and Leadership Structure
of Connected Technologies, 2021 ................................................................................. 23
Appendix D: Overview of Toyota’s Connected Services
Offerings, 2021 ................................................................................................................................... 24
Appendix E: Schematic Overview of Relations Between
Key Toyota Entities, 2022........................................................................................................ 25
Appendix F: Schematic Overview of Toyota’s Mobility
Service Platform, 2021............................................................................................................... 26
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 3

DIGITAL IN THE DRIVER’S SEAT: ACCELERATING

TOYOTA TOYOTA’S TRANSFORMATION TO MOBILITY SERVICES

In 2020 Toyota Motor Corporation (TMC) was the world’s

top-selling car manufacturer.1 Despite this, the company
was being driven to excel further in response to changing
consumer expectations, technological developments,
and new kinds of entrants into the automotive industry.
Reflecting on the past, present, and future of the automotive
industry, Akio Toyoda, president and CEO of Toyota Motor
Corporation (TMC) remarked in June 2018:

Currently, the automotive industry is facing an era of profound

transformation, the likes of which come only once every one hun-
dred years. A hundred years ago, there were fifteen million horses
in America being used for the transportation of both people and
goods. But it is said, within as few as twenty years of the appear-
ance of the Ford Model T, nearly all such horses were replaced by
automobiles. And now, one hundred years later, appearing as our
new rivals right in front of us are technology companies, which
have a way of thinking that is different from that of the automotive
industry. I think we can say that we are approaching a phase in
which there is the possibility of tremendous change in the future of
the automobile.

AKIO TOYODA, PRESIDENT AND CHIEF EXECUTIVE OFFICER,

TOYOTA MOTOR CORPORATION2

At Toyota Connected Day 2018, a launch event for connected vehicles,

Toyota introduced its first generation of vehicles that would provide
connected services to users via the company’s newly developed Mobility
Services Platform (MSPF). This digital platform would provide a founda-
tion to improve existing in-car services—such as turn-by-turn navigation,
emergency services, and remote diagnostics—and also pave the way

1 River Davis and Tsuyoshi Inajima, “Volkswagen Loses Title of World’s Top-Selling Car-
maker to Toyota,” Bloomberg, January 28, 2021, https://www.bloomberg.com/news/arti-
cles/2021-01-28/toyota-unseats-vw-to-become-the-world-s-top-selling-automaker.
2 “Highlights from Toyota Connected Day 2018,” YouTube video, 3:13, recorded at
Toyota Connected Day in Tokyo, Japan in June 2018, video, https://www.youtube.com/
watch?v=0BOrvf0Vapk&t=193s.

The authors would like to acknowledge and thank the executives at Toyota Motor North
America and Toyota Connected for participating in the case study, Jeanne Ross for her help in
getting this case started, and Leslie Owens for supporting it through to its completion.
© 2022 MIT Sloan Center for Information Systems Research. All rights reserved to the authors.
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 4

for entirely new offerings, ecosystem collaborations, and business models. It would serve as the digital engine
underpinning Toyoda’s new strategic vision for TMC. This vision, announced at the Consumer Electronics Show in
January 2018, was to transform Toyota from a car manufacturer to a mobility company:

It’s my goal to transition Toyota from an automobile company to a mobility company, and the possibil-
ities of what we can build, in my mind, are endless. I am determined to create new ways to move and
connect our customers across the country, across town, or just across the room.

AKIO TOYODA, PRESIDENT AND CHIEF EXECUTIVE OFFICER, TOYOTA MOTOR CORPORATION3

Four technology-based trends that were transforming the concept of the automobile had inspired Toyoda’s
vision. On a societal level, technological developments had given rise to the sharing economy. Ride- and car-shar-
ing services (such as Uber, Lyft, and Zipcar) that could conveniently provide mobility on demand with a pay-per-
use arrangement were challenging the traditional model of vehicle ownership. In addition, advancements in
electrification and autonomous driving were leading to the embedding of more and more technology in vehicles.
In 2014, Tesla became the first car manufacturer to introduce over-the-air vehicle updates, instantaneously of-
fering updates such as semi-autonomous driving functionality to every one of its Model S all-electric sedans. Si-
multaneously, established Silicon Valley tech giants were finding their own inroads into the automotive industry.
Google and Apple took aim at vehicles’ head units4 through software that would provide consumers with greater
connectivity and a user-friendly interface (in the forms of Android Auto and Apple CarPlay), while also developing
their own autonomous driving technologies.5
Each of these trends had the potential to disrupt the automotive industry, but their convergence created the
potential for entirely new customer value propositions centered on mobility. If Toyota wanted to capitalize on
this potential and lead in the mobility domain, it would have to take a page out of the playbooks of tech giants.
It needed to experiment with digital offerings and learn about customer needs through iterative test-and-learn
cycles. To do this with the speed and agility of a startup while also leveraging the strengths and capabilities of an
established global company, Toyota founded a new organization: Toyota Connected.6

ALL ROADS LED TO DATA: THE ORIGINS OF TOYOTA CONNECTED

The concept for Toyota Connected originated within Toyota Motor North America (TMNA), which was founded
in 1957 as the operating subsidiary overseeing all operations of TMC in Canada, Mexico, and the United States.
By 2015, TMNA, headquartered in Plano, Texas, was home to over 45,000 employees and encompassed five dis-
tributors, eleven manufacturing plants, three research and development sites, and the Toyota Financial Services
Corporation. At that time, sales in the North American market accounted for 33 percent of Toyota’s worldwide
sales of 8.68 million vehicles—a total that made TMC the world’s largest car manufacturer.7

3 “President Akio Toyoda’s Speech at CES 2018,” Newsroom, Toyota Motor Company, January 9, 2018, https://global.toyota/en/newsroom/
corporate/20566886.html.
4 Head units, sometimes referred to as multimedia or infotainment systems, were hardware components found in a vehicle’s dashboard
or center console. They consisted of screens, buttons, and system controls that provided vehicles’ information and entertainment functions
such as audio and navigation.
5 In 2012, Google became the first company to request an autonomous vehicle license in the United States, which was granted to a Toyota
Prius that Google had modified with experimental driverless technology; see Mary Slosson, “Google gets first self-driven car license in Neva-
da,” Reuters, May 8, 2012, https://www.reuters.com/article/uk-usa-nevada-google-idUSLNE84701320120508. Apple was reportedly working
on and off on its own autonomous vehicle since 2014 in an effort known as Project Titan; see Stephen Nellis, Norihiko Shirouzu, and Paul
Lienert, “Exclusive: Apple targets car production by 2024 and eyes ‘next level’ battery technology – sources,” Reuters, December 21, 2020,
https://www.reuters.com/article/us-apple-autos-exclusive-idUSKBN28V2PY.
6 The authors studied Toyota Connected from 2018 through 2021, conducting fourteen interviews with ten senior executives from Toyota
Connected and Toyota Motor North America.
7 Toyota Motor Corporation, Annual Report: Sustainable Management Report 2016, March 31, 2016, https://www.toyota-global.com/pages/
contents/investors/ir_library/annual/pdf/2016/sustainable_management_report16_fe.pdf; and International Organization of Motor Vehicle
Manufacturers (OICA), “World Motor Vehicle Production: World Ranking of Manufacturers,” accessed April 14, 2021, https://www.oica.net/
wp-content/uploads//ranking2015.pdf.
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 5

TMNA’s Information Services (IS) division, led by Zack Hicks (the company’s Chief Information Officer in 2015),8
had worked for the better part of a decade to grow beyond its traditional role as a siloed order taker for individu-
al business projects and become a driver of digitization and digital initiatives.9 To ramp up digital innovation, the
IS division organized multiple “innovation fairs” where employees could share their ideas and acquire funding to
move them forward. Most of the innovations that came out of these initiatives targeted the customer experience
and leveraged the company’s growing volume of customer and (telematics-based) vehicle data:

We’re getting data from our new Camry every millisecond. We know how fast each vehicle was going,
how many seatbelts were buckled, what lane it was in. We can also use that data to understand if
there’s a hazard on the road and be able to warn the drivers behind them. This is just the beginning of
what we can do with this data.

ZACK HICKS, PRESIDENT AND CHIEF EXECUTIVE OFFICER, TOYOTA CONNECTED NORTH AMERICA; EXECUTIVE VICE
PRESIDENT AND CHIEF DIGITAL OFFICER, TOYOTA MOTOR NORTH AMERICA

These data assets were considered likely to become a major source of value for Toyota. TMNA’s IS division had
worked to provide a unified data architecture and develop strong analytics expertise to allow TMNA to gain
insights from customer data, including customers’ online sentiment toward Toyota and interactions with dealer-
ships. But when TMNA wanted to generate value-creating insights from vehicle data, the company found itself
constrained by a complex landscape of legacy systems built by external developers. In 2016, approximately 80
percent of the IS division’s workforce consisted of outsourced employees, which severely limited TMNA’s speed,
agility, and ability to differentiate its offerings from competitors. To turn TMNA’s vehicle data into value, Hicks
took a greenfield approach led by in-house digital talent. Attracting such talent to a large, traditional company,
however, was challenging:

We had built some really amazing capabilities around capturing, cleaning, and managing data, but
the real value was in unleashing it. If we were serious about doing this, we’d have to create a separate
company where we could work at the speed of Silicon Valley and attract talent that wouldn’t normally
be attracted to working for a traditional company. This is why and how Toyota Connected was born.

ZACK HICKS

DIGITALLY DRIVEN: GETTING A NEW COMPANY UP TO SPEED

Akio Toyoda established Toyota Connected, Inc.10 on April 4, 2016, as a separate legal entity of TMC. Led by a
team of experienced Toyota executives and with Zack Hicks as its founder, chief executive officer, and president,11
Toyota Connected received from TMC a one-time investment of US$5.5 million and an official remit to signifi-
cantly expand TMNA’s capabilities in data management and digital services development.
By partnering with Microsoft Corporation in areas such as data analytics and mobile technologies, the new
company—consisting of approximately forty new hires12—quickly became a data science hub with capabilities to

8 Zack Hicks was TMNA’s Chief Information Officer from January 2012 until April 2018, when he was promoted to become TMNA’s first
Chief Digital Officer. Hicks stayed on as interim Chief Information Officer until the CIO role was filled by Manjit Singh in June 2018, with Singh
reporting directly to Hicks.
9 Paul Betancourt, John Mooney, and Jeanne W. Ross, “Digital Innovation at Toyota Motor North America: Revamping the Role of IT,” MIT
CISR Working Paper No. 403, September 2015, https://cisr.mit.edu/publication/MIT_CISRwp403_Toyota_BetancourtMooneyRoss.
10 Toyota Connected, Inc. changed its company name to Toyota Connected North America, Inc. on July 24, 2017. “Notice of Change in Cor-
porate Name, Affiliated Company, United States-based Toyota Connected, Inc.,” Toyota Connected Corporation, August 9, 2017, https://www.
toyotaconnected.co.jp/en/news/2017/0809.html.
11 See appendix A for an overview of the organizational structure of Toyota Connected in 2021.
12 Between 2016 and 2021, Toyota Connected grew from a team of around 40 to approximately 175 full-time employees and 125 contrac-
tors. The number of contractors fluctuated as they were brought on temporarily for specialized skills or niche roles (such as data linguists) for
which the organization didn’t anticipate an ongoing need.
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 6

ingest and analyze massive amounts of vehicle data. The company’s initial focus was to leverage this new data re-
source in two ways: (1) to provide cutting-edge analytics support to product development for TMNA’s customers,
dealers, distributors, and partners; and (2) to deliver seamless contextual services to customers:

We’re extracting all the information off the car and putting it to work in different ways. One is “cost
down” scenarios within Toyota. For example, we can use vehicle sensor data to determine when a
part is going to fail, so our quality teams can get feedback and fix the issue quicker. Or we can identify
potential recalls earlier. Our “revenue up” initiatives, on the other hand, include new services like fleet
management vehicle data and offering a digital key for the vehicle.

JOSH BATIE, DIRECTOR OF GLOBAL BUSINESS DEVELOPMENT, TOYOTA CONNECTED NORTH AMERICA; CHIEF PRODUCT
OWNER, STRATEGY & BUSINESS DEVELOPMENT, CONNECTED TECHNOLOGIES, TOYOTA MOTOR NORTH AMERICA13

Toyota Connected’s first offering was its Big Data Center, which became pivotal in making vehicle data easily
accessible to teams within TMNA. This data center was based on the company’s concept of “Smart Data”: it
ingested only data for which teams had a specific purpose and provided data feeds via microservices:

We have created standardized connections to the car. If needed, we can capture a large amount of
data—but I’ll only turn on a specific feed at a certain interval if, for instance, my R&D or quality group
asks for it. There is no point to collecting and storing all that data otherwise. We would have collapsed
under the scope and scale of our own weight without those standards.

JOSH BATIE

The Big Data Center would ultimately become Toyota Connected Data Services; Data was one of five strategic
business domains within Toyota Connected. Toyota Connected’s other strategic business domains—Mobility,
Telematics, Innovation, and Operations—reflected the increasing importance that the company’s executive team
placed on emerging technologies. To jump-start these domains, Toyota Connected absorbed existing TMNA ini-
tiatives for in-car services and telematics, artificial intelligence, IoT connectivity, robotics, and smart city integra-
tion.14 Combined, these new technologies had the potential to address rapidly changing customer needs. Where-
as the typical time to realize a new vehicle model was five to seven years, customer needs and preferences
changed on an almost annual basis. These new customer expectations were impossible to accommodate quickly
without modifying production lines, which would have required considerable time and investment. By delivering
software-enabled products and services, however, Toyota Connected could match the pace of new technological
developments and realize changes to Toyota’s customer experience continuously. The company’s teams envi-
sioned a future where Toyota owners could receive over-the-air updates15 for their vehicles, introducing features
such as predictive routing, in-vehicle lifeform detection (to prevent hot car deaths), and AMBER Alert assistance
(leveraging vehicles’ outward-facing cameras to search for an implicated license plate). Delivering such experi-
ences in the most seamless way became the teams’ primary purpose:

The mission of Toyota Connected is freeing our customers from the tyranny of technology, making a
connected life a more human experience. Technology, I think, has been done so badly in vehicles and
systems to date, and it shouldn’t be that way. Technology should be easy and simple, invisible to a
certain extent.

STEVE BASRA, EXECUTIVE VICE PRESIDENT AND CHIEF OPERATING OFFICER, TOYOTA CONNECTED NORTH
AMERICA; GROUP VICE PRESIDENT, CONNECTED TECHNOLOGIES, TOYOTA MOTOR NORTH AMERICA

13 In June 2021, Batie became Executive Director of Connected Products and Mobility R&D at Toyota Connected North America, and General
Manager, Connected Vehicle Services, Future Mobility Strategy and Consumer Applications at TMNA.
14 See appendix B for an overview of how these technologies were reflected in Toyota Connected’s strategic business domains.
15 Over-the-air updates involve the wireless distribution of new software, firmware, or other data to vehicles, similar to how smartphone
operating systems and applications receive updates from app stores.
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 7

Toyota Connected’s purpose reflected its focus on developing new software-enabled products and services that
were intuitive, contextual, and as invisible as possible to end users. In line with TMC’s goal to move from auto-
mobile company to mobility company, the broad and future-oriented nature of its mission statement served as a
North Star to guide and inspire teams to think of innovative offerings:

How you define the problem dictates what your solutions are. If you define a problem as “my car broke
down,” then your solutions become “I can fix my car,” “I can rent a new car,” “I could borrow a car,” “I
can buy a new car.” But if your problem is defined as “I need to get to work,” then “I could ride a bike,” “I
could walk,” “I could take the bus” . . . you open up your solutions. We need to have that kind of mentali-
ty here because our environment is changing, our buyers are changing. We have to think long term.

JENNIFER BROWN, CHIEF PEOPLE OFFICER, TOYOTA CONNECTED NORTH AMERICA

To make its mission statement more actionable, Toyota Connected engaged in regular goal-setting and strategic
planning exercises—including the Hoshin Kanri16 process used throughout TMC. During these collaborative plan-
ning exercises, senior leaders, product owners, and team members discussed market opportunities and devel-
oped a shared understanding of where competitive products—not just other car manufacturers—were heading.
They reviewed which future services might be meaningful for the customer, where Toyota Connected had a com-
petitive edge, and which of its potential new offerings might be helpful or creepy to customers. These discus-
sions surfaced interdependencies, which aided cross-functional teamwork and informed operational decisions
regarding what teams would work on, who would do the work, and how to fund the development of offerings:

We want teams to focus on creating innovative solutions, but the risk is that innovation can live in
company silos. That’s why we focus on establishing shared goals, so that all product teams have an
underlying foundation in common, which is how we choose what to work on next.

JAMES GEORGE, DEPUTY CHIEF OPERATING OFFICER, TOYOTA CONNECTED NORTH AMERICA17

To further its mission, Toyota Connected created a dedicated user experience (UX) team to ensure that all of
the company’s products would look and feel like a cohesive set of offerings to the customer. This twenty-person
team was established in April 2017 as a horizontal function, with designers and engineers becoming integral
members of product teams in each of Toyota Connected’s business domains. Heading up the UX team was Daniel
Hall, who came from leading UX efforts at an automotive data intelligence platform and had no prior experience
in working at Toyota. Two weeks into working at the company, he was listening to a session with customers
who were upset and frustrated with one of the most tangible components of the user experience: head units.
Unaware of existing procedures and ways of working at the multinational corporation, Hall sought a way to inject
the voice of these customers into the design of Toyota’s vehicles:

Traditionally, the design of these systems has been owned in Japan and each region would send them a
list of things they’d like to include in the next iteration. Then four years later, we’d get a car that clearly
wasn’t meeting the needs of our customers here in the US. So I just started working on what I thought
these systems could be, taking the approach of getting customer feedback early. We didn’t ask if we
could or should do that. We didn’t tell Zack [Hicks, CEO of Toyota Connected] about it. Steve [Basra,
COO of Toyota Connected] and I just started doing some testing.

DANIEL HALL, GLOBAL CHIEF UX DESIGNER AND EXECUTIVE DIRECTOR, TOYOTA CONNECTED NORTH AMERICA;
CHIEF ENGINEER AND GROUP MANAGER, CONNECTED TECHNOLOGIES, TOYOTA MOTOR NORTH AMERICA; CHIEF
UX DESIGNER, TOYOTA MOTOR CORPORATION

16 Hoshin Kanri was a joint strategic planning process designed to ensure that strategic goals were properly communicated and realized throughout
an organization. In this seven-step process, vision statements first encouraged breakthrough thinking about the organization’s future direction. Then
a cascade of complementary objectives were defined, with progress toward these objectives regularly reviewed and communicated.
17 In July 2021, James George became the General Manager of Electric Vehicle Charging Solutions at Toyota Motor North America. Mark
McClung succeeded George as Deputy Chief Operating Officer.
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 8

Instead of leveraging and improving existing trackpad solutions, Hall and Basra created a prototype system that
incorporated voice commands and touchscreen functionality. Built as an iPad application, the team could easily
carry their prototype around and test it with customers. After conducting roughly two thousand hours of one-on-
one customer tests and getting positive feedback, they presented the prototype to the CEOs of Toyota Connect-
ed, TMNA, and TMC, seeking permission to move forward with their design:

We took this concept, which in no way, shape, or form (knowing what I know now) was even close
to something that we could put into a car, to Japan, and we got their agreement to build a separate
multimedia system for North America only. The rest of the world would continue with the old structure
and process of designing these kinds of systems. Now it was on us to meet the expectations of the
North American customer—and do it quickly. Because we still had to adhere to the milestones in TMC’s
release programs.

DANIEL HALL, GLOBAL CHIEF UX DESIGNER AND EXECUTIVE DIRECTOR, TOYOTA CONNECTED NORTH AMERICA;
CHIEF ENGINEER AND GROUP MANAGER, CONNECTED TECHNOLOGIES, TOYOTA MOTOR NORTH AMERICA; CHIEF
UX DESIGNER, TOYOTA MOTOR CORPORATION

Building a new head unit meant that the team had to work much more closely with divisions within TMNA
that interacted and had relationships with the vehicle product teams at TMC in Japan. What started as a small
experiment within Toyota Connected quickly prompted TMNA to create a new division. In August 2017, TMNA
announced it had formed Connected Technologies with an initial commitment of US$300,000 to design and build
a new head unit for North American vehicles. It was staffed with one hundred employees drawn from different
TMNA divisions.18 Steve Basra assumed leadership of Connected Technologies while still retaining his role as chief
operating officer of Toyota Connected:19

We had all these different groups . . . R&D sitting in Michigan doing electronic engineering. IT in the IT
group. Business planning and operations in Sales. My idea was to bring all these groups together. To
bring them here as a new unit under one control. These decisions typically take years; this took a week.
It’s the biggest organizational change I’ve ever seen approved.

STEVE BASRA, EXECUTIVE VICE PRESIDENT AND CHIEF OPERATING OFFICER, TOYOTA CONNECTED NORTH
AMERICA; GROUP VICE PRESIDENT, CONNECTED TECHNOLOGIES, TOYOTA MOTOR NORTH AMERICA

As one of only two Profit and Loss (P&L) divisions within TMNA, Connected Technologies had a direct connection
with Toyota and Lexus field divisions and dealers, enabling it to sell connected services developed by Toyota Con-
nected directly to end customers. These solutions included Safety Connect (emergency and collision assistance),
Remote Connect (real-time vehicle information and access features), and Destination Assistance (navigation
support via a live agent).20 The revenue from these connected services funded the development of Connected
Technologies’ new head unit, as well as other offerings that integrated with vehicle systems. Connected Tech-
nologies compensated Toyota Connected for the development and support of these services, including for their
content and underlying cloud infrastructure.
Toyota Connected and Connected Technologies were closely aligned but had distinct responsibilities. Connected
Technologies was responsible for the end customer experience, sales and marketing of connected services, and
in-vehicle technology development (such as the North American head unit). As a separate legal entity, Toyota
Connected provided data and telematics services, and developed artificial intelligence and machine learning
solutions for use across Toyota—including by Connected Technologies:21

18 Between 2017 and 2019 the number of Connected Technologies employees grew from one hundred to approximately five hundred.
19 See appendix C for an overview of the organizational structure of Connected Technologies.
20 See appendix D for a full overview of Connected Services offerings that Connected Technologies sold to Toyota and Lexus customers.
21 See appendix E for a schematic overview of the relations between TMC, Toyota Connected, TMNA, and Connected Technologies.
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 9

Toyota Connected is newer, younger. It’s all engineers, has all the experts in areas such as artificial
intelligence and machine learning. So anything I need to build in Connected Technologies that requires
those skills, I can draw on the talent in Toyota Connected to do that.

STEVE BASRA, EXECUTIVE VICE PRESIDENT AND CHIEF OPERATING OFFICER, TOYOTA CONNECTED NORTH
AMERICA; GROUP VICE PRESIDENT, CONNECTED TECHNOLOGIES, TOYOTA MOTOR NORTH AMERICA

SHARING THE ROAD: DISTINCT ORGANIZATIONS, SHARED LEADERSHIP

By 2021, Zack Hicks held roles as executive vice president and chief digital officer at TMNA and president and
CEO of Toyota Connected, and everyone at Toyota Connected, Connected Technologies, and TMNA IS ultimately
reported to him. Additionally, Hicks served in global roles leading information security management and con-
nected vehicle ecosystems for TMC. Steve Basra served as executive vice president and chief operating officer
of Toyota Connected and group vice president of Connected Technologies. Basra reported to Hicks in both roles.
Daniel Hall’s primary role was as a global chief UX designer at Toyota Connected, but he later additionally held
similar roles at Connected Technologies and TMC. Having key executives serve in multiple concurrent leadership
roles within various parts of Toyota was referred to internally as multi-capping, and it was common throughout
Toyota. A multi-capped employee took on extra responsibility and was given an additional job title, but retained
his or her original employment relationship, pay, and benefits.
While there was no financial incentive for multi-capping, it served several purposes for both the company and
those who took on such roles. First, it was a way to better leverage and nurture talent throughout the company,
facilitating company-wide learning. Contrary to the traditional approach of job rotations—in which employees
switch roles over time—the multi-capping approach enabled talented employees to further develop their skill
sets by applying them more broadly, while simultaneously gaining new insights and experience that benefited
their existing affiliation(s):

Where I have a proven person, someone who’s able to make big change and deliver on it in a meaning-
ful way, if I can leverage their talents over both organizations, I’ll continue to do that because it also
allows them to grow in new ways. I think both organizations benefit.

ZACK HICKS, PRESIDENT AND CHIEF EXECUTIVE OFFICER, TOYOTA CONNECTED NORTH AMERICA; EXECUTIVE VICE
PRESIDENT AND CHIEF DIGITAL OFFICER, TOYOTA MOTOR NORTH AMERICA

Second, multi-capping encouraged employees to take ownership for making meaningful improvements. Those at
Toyota who had novel approaches, solutions, or offerings in mind found that the best (and often recommended)
way to proceed was to go out and do it—with end-to-end responsibility for realization. Basra and Hall’s efforts
that led to the creation of Connected Technologies was a prime example:

At Toyota Connected we asked ourselves, what should we be designing to ensure a consistent user
experience in our vehicles? We took responsibility for Multimedia and also got involved in designing
vehicles in spaces where traditionally our chief automotive engineers had full autonomy—the center
stack, dashboard, speedometer, tachometer, and fuel gauge—to deliver on a more consistent in-vehicle
experience.

ZACK HICKS

Third, multi-capping enhanced speed and coordination. By officially representing the interests of distinct enti-
ties, multi-capped executives were not only informed of but could advocate for each entity’s interests. They thus
served as crucial lynchpins who enabled Toyota to exchange information and make decisions faster, with better
alignment to the organization’s purpose and vision. There was less need to convince other executives of a specific
course of action, to worry about allocating credit for intellectual property, or to argue about resource allocation.
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 10

When you first look at the organization chart you might say that there appears to be a lot of overlap,
but once you get into it, it actually makes a lot of sense because of these linked roles. For instance, Zack’s
TMC role allows him to have influence and leadership of our global mobility strategy, his North America
role has overall responsibility of our North America operations, and his Toyota Connected role drives the
development of the technology that we will need for our future mobility and connected data services.

JOSH BATIE, DIRECTOR OF GLOBAL BUSINESS DEVELOPMENT, TOYOTA CONNECTED NORTH AMERICA; CHIEF PRODUCT
OWNER, STRATEGY & BUSINESS DEVELOPMENT, CONNECTED TECHNOLOGIES, TOYOTA MOTOR NORTH AMERICA

Accelerating via New Ways of Working

Despite the similarities in name, leadership, and the offerings they brought to market, Toyota Connected and
Connected Technologies were designed to operate as very different companies. While Connected Technologies
operated much like the rest of Toyota—navigating the consensus-based decision-making processes and ways of
working of the large multinational corporation—Toyota Connected was founded to appeal to data and digital tal-
ent from outside Toyota. It was set up to operate as a digital-native new venture—small, agile, customer-centric,
providing significant responsibilities to its employees, and free from legacy systems, policies, and processes—
which enabled it to quickly leverage cutting-edge technologies.
Toyota Connected’s independence from TMNA was embodied in the location of its new office, which was a brief
car ride away from TMNA’s campus in Plano, Texas. It was physically separate, yet close enough to facilitate
frequent interaction and collaboration between the two companies. The work environment at Toyota Connected
was modern, resembling a design firm, with typical startup perks such as free lunches, beer fridges, and unlimit-
ed time off for employees. These perks weren’t the main draw for potential job candidates, however; what new
hires ultimately found more interesting was the mission of Toyota Connected, and how its relationship with TMC
could help them realize the future of mobility:

What interests our candidates is that they are able to come in and work at a small company with an
enormous reach. They get to work with really compelling technology on products and services that can
end up in the hands of their grandmothers as well as millions of other drivers. They can do meaningful
work here and really leave an impact.

JENNIFER BROWN, CHIEF PEOPLE OFFICER, TOYOTA CONNECTED NORTH AMERICA

To symbolize their potential for transformative change, each new employee put their baby photo on the com-
pany’s wall—as a reminder of a time when they believed that they could change the world. To help them realize
this change, Toyota Connected’s leadership gave employees considerable authority and accountability. They
encouraged employees to self-organize around problems and customers’ unmet needs, and to form teams that
both envisioned and delivered new digital offerings:

My goal is to empower my employees, giving them the authority to make decisions. Any transforma-
tion in any company, digital or otherwise, really comes back down to how you manage your teams and
how you manage your people. I try to make myself as available as possible. I try to drive this account-
ability to my employees and to say, look, I hire the right people to make the right decisions. Otherwise,
we just move too slowly. If I try to make every decision, it’s never going to happen.

STEVE BASRA, EXECUTIVE VICE PRESIDENT AND CHIEF OPERATING OFFICER, TOYOTA CONNECTED NORTH
AMERICA; GROUP VICE PRESIDENT, CONNECTED TECHNOLOGIES, TOYOTA MOTOR NORTH AMERICA

Rather than recruit new employees into an open pool of engineers, team members at Toyota Connected main-
ly hired into their own specific product teams. That way, the company didn’t have to limit teams to technical
skills that were available in the company talent pool. Instead, teams could hire new talent based on the unique
requirements of the offering that they were developing. The goal was to create teams with an enduring core
number of employees that could accelerate and improve over time:
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 11

What we’ve learned is that as teams are together longer their work continues to get better and better,
and they can work really fast. It’s like in sports: an all-star team is really good, but when that team has
been around for a long time and everyone knows each other’s moves, they’ll win nine out of ten times.
That’s why we keep our teams together.

BRETT STERN, MANAGER, BUSINESS MANAGEMENT, TOYOTA CONNECTED NORTH AMERICA

Team members were involved in both the screening process and multiple rounds of interviews for new candi-
dates. Both the teams and People Operations (the company’s name for the HR department) at Toyota Connected
had the right to veto a candidate. People Operations interviewed every candidate to determine their fit with
the organization, but team members determined whether the candidate had mastery of the required technical
capabilities and, most importantly, the right fit with the team:

Team dynamic is really important to us. If people don’t jell well, they don’t work well, and if you’re
spending your time on conflict then you’re not spending your time developing—meaning you are not
getting the best result as a product.

JENNIFER BROWN, CHIEF PEOPLE OFFICER, TOYOTA CONNECTED NORTH AMERICA

Teams were primarily organized around technologies (e.g., Natural Language Processing) and products (e.g., the
DriveLink telematics platform22). Typically, there were about three employees that formed the enduring core of
a product team; they would also ensure continuous product improvement after its initial release. Other team
members rotated in and out, depending on the scope of work and how inspired they were by new products,
solutions, and concepts. Leaders believed that this free movement within Toyota Connected not only kept em-
ployees happy and engaged, but also built strong connections between teams:

Creating really cool products requires people to own the ideas, but also collaborate with each other.
What helps build synergies between teams is when people can move around a little bit. When people
move from one team to another it gives us cross-pollination, and I think that is important. It also sup-
ports talent development and team member retention.

JAMES GEORGE, DEPUTY CHIEF OPERATING OFFICER, TOYOTA CONNECTED NORTH AMERICA

Toyota Connected had a flat organizational structure, with very few management layers. While this model sup-
ported speed and agility, it restricted opportunities for promotion. To address their talent’s need for rapid career
progression, People Operations developed a new job ladder with fourteen levels of career progression—from
level 9 to level 22—each with set criteria in the areas of proficiency, extent of direction required (or given), busi-
ness mindset, and growth mindset. Employees moved up this ladder at their own pace (i.e., movement was not
associated with specific time intervals). Moving up a level did not necessarily mean getting a new title, however:

We have functions, rather than titles, and don’t share which level someone is on. It’s counter to the
culture we’re trying to develop in teams. We want teams to work, and on a great team, you just have
team members. In an ideal team, you don’t need titles.

JENNIFER BROWN

Access to in-house training and mentoring helped employees advance in their roles. There were also weekly
company-wide gatherings (called News & Brews) where teams could share their latest insights and teach each
other about new technologies, as well as share personal stories and anecdotes. In addition, employees had reg-
ular check-in conversations with technical managers, which served as an ongoing performance review process.
While these managers evaluated employees’ performance and provided opportunities for growth, they didn’t

22 DriveLink was the layer between the telematics and the vehicle that enabled connected services such as Safety Connect.
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 12

direct employee activities. Instead, direction came from the product owner and their team. Unlike TMNA, Toyota
Connected did not have any form of progressive discipline for those who underperformed, nor any room for
reassignment elsewhere in the company. If—despite coaching and development—employees did not achieve the
desired level of performance, their contracts would not be renewed:

I have people over in Connected Technologies who say, “I want to go and work over in Toyota Connect-
ed!” And while we do double-cap people, we don’t allow them to move from one to the other, because
both companies have their own strengths.

STEVE BASRA, EXECUTIVE VICE PRESIDENT AND CHIEF OPERATING OFFICER, TOYOTA CONNECTED NORTH
AMERICA; GROUP VICE PRESIDENT, CONNECTED TECHNOLOGIES, TOYOTA MOTOR NORTH AMERICA

Multi-Capping as a Vehicle for Change Within TMNA

IT engineers at Connected Technologies and TMNA IS were often attracted to the new ways of working at Toyota
Connected. But rather than transfer them over, Hicks and Basra urged these employees to work with—and learn
from—multi-capped talent to help them realize the best of Toyota Connected over in TMNA. This way, they could
gradually transform not just Connected Technologies but also the corporate IT group into an empowered opera-
tion with the required skills to work in more agile ways:

We purposely started Agile on the larger Toyota side [i.e., TMNA Information Services] in places where
I knew we would be successful. It was like one battle at a time; we had to market our successes and
get the business to participate. But now I have to retool my IT staff as well. When everything was
outsourced, my people essentially became vendor managers. As we move into Agile, you have to have
technical ability. You’ve got to be able to write code.

ZACK HICKS, PRESIDENT AND CHIEF EXECUTIVE OFFICER, TOYOTA CONNECTED NORTH AMERICA; EXECUTIVE VICE
PRESIDENT AND CHIEF DIGITAL OFFICER, TOYOTA MOTOR NORTH AMERICA

In contrast to Toyota Connected, TMNA IS did not get the luxury of a clean slate that hiring an entire new work-
force of digital talent would have brought. Instead, TMNA’s senior leaders had to overcome inertia and resistance
among their teams and middle managers to change entrenched habits that were based in corporate IT’s incre-
mental approaches to change. Also, some employees were skeptical about whether best practices from a small,
young company like Toyota Connected would work in a large, established, complex company such as TMNA. To
help overcome this reluctance to adopt some of Toyota Connected’s ways of working, Hicks deliberately multi-
capped Agile and UX experts from Toyota Connected and created dedicated support teams for Agile and UX
within TMNA. These groups leveraged their Toyota-specific experience to help project teams apply new ways of
working, thereby creating success stories and winning over skeptics:

Why would we try to bring in somebody from outside when we have these resources right across the
street? And they know us! We’ve now done a couple of “beacon projects” where we’ve taken scrum to
more of a Dev/Sec/Ops model where we truly integrate operations into development, and it’s going to
be a key component to our new operating model.

JASON BALLARD, INFORMATION SYSTEMS EXECUTIVE AND GENERAL MANAGER OF INFRASTRUCTURE AND
OPERATIONS SERVICES, TOYOTA MOTOR NORTH AMERICA

By steadily developing new habits and changing mindsets, TMNA IS created a work environment that was able
to better attract and retain new talent with sought-after technical skills. This allowed the department to con-
vert formerly outsourced jobs into insourced ones and move away from relying mostly on outside vendors. As
a result, TMNA IS not only became a sought-after global resource in key areas such as cybersecurity, but it was
also able to start simplifying its IT infrastructure to make it more compatible with the platforms and technologies
used by both Connected Technologies and Toyota Connected. These changes meant that Toyota Connected could
confidently transfer mature solutions back to TMNA for further execution at scale.
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 13

The “easy button” is calling a supplier. But if you do that, you’re going to end up with these disparate
platforms and systems that don’t talk to each other. We have to triangulate and get ahead of the de-
mand, so we’re trying to be very judicious about who we bring into corporate IT now. We shouldn’t just
solve a pain point; we’re looking for that ability to adapt, be technically curious, driven to learn more,
and deliver for the business.

ZACK HICKS, PRESIDENT AND CHIEF EXECUTIVE OFFICER, TOYOTA CONNECTED NORTH AMERICA; EXECUTIVE VICE
PRESIDENT AND CHIEF DIGITAL OFFICER, TOYOTA MOTOR NORTH AMERICA

GUARDRAILS: EMPOWERING AND ALIGNING TEAMS

Toyota Connected’s new ways of working did not come without initial growing pains. After operating with small,
highly autonomous teams, scaling its workforce from forty people in 2016 to over two hundred in 2019 took its
toll. Teams began prioritizing their own speed and progress over that of Toyota Connected. They made their own
copies of data, and chose technologies irrespective of their ability to interface with other teams. Given consider-
able autonomy, teams created silos and traditional structures. Employees even began asking for more trainers,
administrative layers, and managers:

They began pulling toward the thing they told me they despised—a traditional company. Finding that
balance—and not being seduced back into traditional structures—is an ongoing effort. Having Agile in
Toyota Connected and a more traditional model in Toyota Motor North America is like an A/B test, and
I can leverage the best of both models to continuously innovate our ways of working.

ZACK HICKS

Removing Roadblocks with Minimum Viable Policy

The leadership team at Toyota Connected put governance mechanisms in place to prevent teams from acceler-
ating at the cost of greater complexity of data, systems, and processes. A matrix-based organizational structure,
in which (horizontal) shared services groups ensured consistency across (vertical) product teams, was one such
mechanism. Members from the shared services groups were embedded in the product teams, instilling discipline
and standards that made the company as a whole more efficient. The UX design group, for instance, focused
on ensuring a consistent user experience, and infrastructure teams ensured interoperability between solutions.
While this approach seemingly made the organizational structure more complex, it forced teams to communi-
cate outside their own silos:

It’s not a perfect structure, but with the complexity of what we’re trying to build, it’s inevitable. It intro-
duces a lot of gray zones of accountability across the company, and what that means is people have to
talk to each other. You start to find all kinds of issues, which is a good thing. Now those issues come out
of the woodwork before you actually launch a product.

STEVE BASRA, EXECUTIVE VICE PRESIDENT AND CHIEF OPERATING OFFICER, TOYOTA CONNECTED NORTH
AMERICA; GROUP VICE PRESIDENT, CONNECTED TECHNOLOGIES, TOYOTA MOTOR NORTH AMERICA

Each shared services group had to determine how prescriptive it could be, assessing the needs for customization
by product teams and company-wide standardization. For instance, members of the UX design group created a
design system—a mix of design and engineering processes and standards, partly instantiated in reusable code—
that every product team was expected to adopt. The processes helped teams validate ideas and build solutions
for testing with customers; the standards provided recommended use patterns for modular design elements; and
the reusable code allowed engineers to quickly instantiate these elements in their applications. In this way, UX
design was decoupled from product design. Teams moved faster in software development, while the UX design
group maintained a coherent look and feel across the company’s wide spectrum of user interfaces (e.g., in-vehi-
cle systems, mobile applications, websites):
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 14

We’re always trying to balance how customizable versus how restrictive we need to be as a UX team.
What ends up in a car or in a mobile phone is composed of those pieces that the UX team created,
arranged by very specific feature-minded teams that are working on solutions. In some cases we need
specific branding—think of a Toyota versus a Lexus application—so we want to enable you to use the
same code base and swap out some themes. But if we build out a system that is endlessly customiz-
able, we would quickly end up with very disjointed and dysfunctional solutions.

DANIEL HALL, GLOBAL CHIEF UX DESIGNER AND EXECUTIVE DIRECTOR, TOYOTA CONNECTED NORTH AMERICA;
CHIEF ENGINEER AND GROUP MANAGER, CONNECTED TECHNOLOGIES, TOYOTA MOTOR NORTH AMERICA; CHIEF
UX DESIGNER, TOYOTA MOTOR CORPORATION

When it came to developing mobile applications, the policy was simple: there would be a single app. Rather than
have users download and navigate a plethora of apps (for example, for car maintenance tracking and schedul-
ing, financial payments, digital keys, remote fuel and parking, and connected services), Connected Technologies
created OneApp: a unified application that serviced both Toyota and Lexus owners.23 Launched in 2019, OneApp
incorporated the functionality of all legacy Toyota and Lexus mobile applications into a single touchpoint for cus-
tomers of the two brands. TMNA required that all new customer-facing offerings had to be included in OneApp,
so that these offerings would benefit from the scale of the app’s user base:

When we first launched a telematics insurance company, they were only getting seventy credit applica-
tions per month. We put them on OneApp and they got three thousand credit applications the first day.
[The increase] was exponential because you’ve got millions of people on OneApp.

ZACK HICKS, PRESIDENT AND CHIEF EXECUTIVE OFFICER, TOYOTA CONNECTED NORTH AMERICA; EXECUTIVE VICE
PRESIDENT AND CHIEF DIGITAL OFFICER, TOYOTA MOTOR NORTH AMERICA

As Toyota Connected was an independent organization, it was free to determine its own solutions architecture.
Teams that created offerings mainly leveraging telematics data could thus take a mostly greenfield approach
to their technology, free from having to integrate with TMNA’s legacy systems. Yet whenever offerings had to
leverage TMNA-specific data (e.g., data involving dealerships or customers), teams had to be able to adequately
interface with TMNA’s mainframe. This required purpose-built middleware solutions, costly rewrites of legacy
systems, or both. To ensure that Toyota Connected could continue to create valuable digital offerings for TMNA
and TMC, its senior technology leaders had to get their technology preferences in sync:

I’ve been spending time with Brian Kursar to understand our connections with Toyota Connected and
to make sure that our stacks are more aligned. If we completely choose different solutions and technol-
ogies, it will be hard for us to leverage each other in the future. So, we’re trying to stay closer to them
to understand their choices and the differences—for example, why we picked one piece of software but
they picked a different piece of software.

JASON BALLARD, INFORMATION SYSTEMS EXECUTIVE AND GENERAL MANAGER OF INFRASTRUCTURE AND
OPERATIONS SERVICES, TOYOTA MOTOR NORTH AMERICA

Connected services fundamentally relied on the telematics hardware inside each vehicle. To ensure that Toyota
Connected and Connected Technologies could continue to push the boundaries with new features and offerings
over the entire lifespan of new vehicles, they had to clarify their hardware requirements for TMC’s automotive
engineers:

23 Note that OneApp was the app’s name internal to Toyota; it was branded in app stores as the Toyota and Lexus apps. While Toyota Con-
nected could have developed this type of solution, it was developed by Connected Technologies instead because that entity was more closely
positioned to the two stakeholders—dealerships and vehicle owners—that were key to the app’s success. Once developed, the app was
maintained by TMNA’s IS unit, while Toyota Connected helped with the rollout of the application to other geographies. To ensure that the
rollout went smoothly, the lead developer for OneApp multi-capped to stand up a global team for OneApp within Toyota Connected.
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 15

When vehicles are being designed in conjunction with us, we define what hardware is going to be on
the vehicle. Which electronic control units are on the car defines how much processing power is on that
car and how much memory it has. We have to give ourselves enough bandwidth to do future over-the-
air upgrades, while still figuring out what people are willing to pay for.

ZACK HICKS, PRESIDENT AND CHIEF EXECUTIVE OFFICER, TOYOTA CONNECTED NORTH AMERICA; EXECUTIVE VICE
PRESIDENT AND CHIEF DIGITAL OFFICER, TOYOTA MOTOR NORTH AMERICA

Wherever possible, Toyota Connected took a modular approach to its solutions architecture to support speed
and avoid complexity. Chief Technology Officer Brian Kursar steered the company away from creating a multitude
of monolithic and closed platforms, as these would be difficult to scale and expensive to maintain. Instead, he
encouraged teams to leverage open source code repositories and shift toward creating microservices that they
could distribute to trusted partners globally for use within their own platforms via common APIs.24 Ultimately,
product owners decided on the boundaries of the offerings (and related components) they would commit to
Toyota Connected’s open mobility services platform, and what others were (and were not) allowed to change.25
By working with a single code base, teams were able to avoid duplication of work, create customer value incre-
mentally, and recombine services into new (locally) customized solutions that could get to market faster. This
approach was more flexible and future-proof, yet also introduced greater security requirements and the need for
fine-grained governance of access to the APIs:

The idea of this open platform really hit me when I started thinking about how we’re eventually going
to be providing the platform for autonomous vehicles and their use cases. A closed platform would
only really work if we owned 100% of the connected market share, so instead we must provide an open
platform and that means we have to focus a lot more on API orchestration and securing these APIs
that attach to the vehicles in a larger ecosystem where vehicles from not just Toyota vehicles exist.

BRIAN KURSAR, CHIEF TECHNOLOGY OFFICER, TOYOTA CONNECTED NORTH AMERICA; CHIEF TECHNOLOGY OFFICER
AND GROUP VICE PRESIDENT DIGITAL TECHNOLOGY, TOYOTA MOTOR NORTH AMERICA

To keep governance from accumulating to the extent that it introduced its own complexity and slowed team
progress, senior leaders at Toyota Connected frequently engaged directly with employees. The leaders were
committed to finding out what hampered teams’ ability to deliver offerings that met customer needs or other-
wise stood in the way of making progress:

It’s not uncommon for Steve or Zack to be sitting with an engineer saying, Hey, what’s going on with
this project? What are your challenges? How can I help? They are really engaged with the teams.

BRETT STERN, MANAGER, BUSINESS MANAGEMENT, TOYOTA CONNECTED NORTH AMERICA

Every day at 5 p.m. we do what we call EAT meetings: Executive Action Team. We flipped the model,
saying it’s not our job to show teams what to do; our job is to remove roadblocks. Our leaders have
one day to do that. If they don’t, then it comes up to me and I have to try to remove the roadblocks.

ZACK HICKS

24 Application Programming Interfaces are sets of functions and procedures that allow the creation of applications and access the features
or data of an operating system, application, or other service.
25 Toyota’s Mobility Services Platform (MSPF) provided microservices to partner companies such as ride sharing, car rental, and car insur-
ance companies. It managed telematics data from connected vehicles via a proprietary cloud service, and offered a variety of APIs for vehicle
health, vehicle status, vehicle management, and authentication. The MSPF was used to provide car and ride sharing solutions, as well as
telematics insurance, and was envisioned to play a key role in enabling autonomous vehicle functionality (such as the e-Palette Mobility as a
Service vehicle). Appendix F provides a schematic of the platform.
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 16

Maintaining Momentum with Resources to Run

Funding and available talent were two critical resources that limited which new offerings Toyota Connected could
develop—particularly during its formative years. From the moment the company started, employees had more
ideas than the company could afford to pursue. Unlike Toyota R&D entities, Toyota Connected did not receive an
annual budget. TMC’s one-time investment gave the company initial autonomy—but also prompted the need for
financial prudence. Senior leaders had to be very selective; each potential initiative would ideally generate recur-
ring revenue or, barring that, had to break even by recouping its development costs with direct funding from oth-
er Toyota entities. This meant that teams always had to keep both internal clients and end consumers in mind:

The limited investment was a blessing in disguise, as it gave us focus. In a sea of good ideas, I could
only work on those things someone was going to actually pay for. Our engineers want to go off and
do interesting things, but at the end of the day there’s a customer standing in front of you asking for
something, and not willing to pay you if you don’t work on what they need.

ZACK HICKS, PRESIDENT AND CHIEF EXECUTIVE OFFICER, TOYOTA CONNECTED NORTH AMERICA; EXECUTIVE VICE
PRESIDENT AND CHIEF DIGITAL OFFICER, TOYOTA MOTOR NORTH AMERICA

Akio Toyoda’s company-wide mandate to focus on mobility helped to generate a lot of internal demand for
Toyota Connected’s services. Chief product owners evaluated requests to build applications or solutions based
on their unique fit with Toyota Connected’s mission, as well as on how transformative the end result would be
for customers. If any other party could do the job, or if the offering would not make customers’ lives better, they
generally deemed it a poor fit. Such requests might generate much-needed “lights on” funding, but typically in-
volved incremental improvements—keeping teams from delivering true, net-new innovations. Toyota Connected
thus had to learn to pitch innovative ideas to internal clients across the globe:

The business doesn’t always know what’s possible. It’s been my experience that when there’s a good
idea, the engineers sometimes don’t have a great style of communicating what the possibilities could
be. We have an obligation to show the potential of our innovations in action. Where we see lots of
progress is in showing the business early prototypes, showing them what could be—even if it is a
mock-up. Because then you get a different kind of engagement.

ZACK HICKS

Toyota Connected’s multi-capped executives played a key role in negotiating pricing, eventual ownership of
intellectual property, contribution of effort or resources, and the distribution of potential revenue streams. For
instance, connected services were based on telematics data, which was owned by TMNA. Toyota Connected
aggregated and processed the data on its own cloud platforms and found innovative use cases for leveraging it
(sometimes with funding from TMNA). Connected Technologies ultimately managed and sold connected services
to customers. In the end, each of these three entities needed to show a profit:

These discussions are a bit of art and science, as there are many moving pieces. When we get develop-
ment funds from TMNA, we’re building for them—so they’re going to own the intellectual property. But
when we jointly develop something, and monetize it, then we get some revenue share—providing us
with sustained income that allows us to work on other things and develop our own intellectual property.

JAMES GEORGE, DEPUTY CHIEF OPERATING OFFICER, TOYOTA CONNECTED NORTH AMERICA

In its first couple of years of operation, TMC and TMNA each provided half of Toyota Connected’s revenues. By
2020, however, TMNA’s Connected Technologies division accounted for approximately eighty-five percent of
Toyota Connected’s revenues. A key revenue-generating offering was DriveLink, a platform that Toyota Con-
nected developed for Connected Technologies. DriveLink replaced an external service provider’s solution for
data transfer between connected vehicles and the cloud. The DriveLink platform proved more reliable than the
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 17

original solution (its uptime was one hundred percent, compared to ninety-three percent for that provider), and
it cost twenty percent less to operate. Toyota Connected received some revenue for supporting DriveLink, but
Hicks made sure that most of the profits from Toyota Connected’s initiatives went to the entities (such as TMNA)
that funded their development:

I want them to make most of the money because then they’ll continue to invest in these services and cre-
ate a viable business out of it. I just want Toyota Connected to make enough to survive and do some R&D.

ZACK HICKS, PRESIDENT AND CHIEF EXECUTIVE OFFICER, TOYOTA CONNECTED NORTH AMERICA; EXECUTIVE VICE
PRESIDENT AND CHIEF DIGITAL OFFICER, TOYOTA MOTOR NORTH AMERICA

In 2020, with several revenue-generating offerings in place, Toyota Connected became profitable. This allowed
its executive team to make strategic bets and pursue initiatives in areas where the rest of the business might not
see immediate value. Funding for such new initiatives followed a venture-capital model, keying on three maturity
stages: proof of concept, development, and operation. When engineers had ideas for offerings that they were
passionate about, they asked their respective chief product owners for approval to build out a prototype. If the
prototype showed market potential to solve a unique problem, the developers brought it to members of the
executive team (through a product review board and investment council) for further development funding. Once
an offering reached the stage of a (successful) minimum viable product, Toyota Connected pitched it to other
Toyota entities for adoption, in order to obtain funding for further development and operations. Teams would
continue to receive funding for their initiatives so long as they showed meaningful progress in working toward
the next stage of maturity. There were, however, no universal metrics that initiatives had to meet or adhere to—
especially as teams often worked on innovations for which customers’ price sensitivity and the size of the market
were unknown:

KPIs are very specific to each team. We have to really understand what they are trying to achieve and
then base our KPIs around that. If we would look for some KPI that fit every team, we’d fail, and we’d
make people unhappy, trying to push them down a path they shouldn’t be on.

STEVE BASRA, EXECUTIVE VICE PRESIDENT AND CHIEF OPERATING OFFICER, TOYOTA CONNECTED NORTH
AMERICA; GROUP VICE PRESIDENT, CONNECTED TECHNOLOGIES, TOYOTA MOTOR NORTH AMERICA

The venture capital approach to funding initiatives meant that teams could not just build whatever they wanted;
they also had to develop responsible habits for how they were thinking about their offerings. Business consid-
erations (price points, potential market share, and most importantly, cost) became required elements of teams’
Agile stories. Toyota Connected’s executive team found that most of their software engineers naturally took to
cost-conscious and efficient habits:

What people don’t realize is that really great software engineers are highly efficient. They write the
fewest lines of code and know how to cut out every single millisecond, to create software that is very
snappy—that reacts immediately. This is not all that different from cost reductions in the financial
world. So, the engineers are actually inspired by the idea of writing code that would be not just effi-
cient but cost effective in the real world.

BRIAN KURSAR, CHIEF TECHNOLOGY OFFICER, TOYOTA CONNECTED NORTH AMERICA; CHIEF TECHNOLOGY OFFICER
AND GROUP VICE PRESIDENT DIGITAL TECHNOLOGY, TOYOTA MOTOR NORTH AMERICA

Even when teams were looking to add additional features to existing offerings, they considered the recurring cost
of doing so. Would a new feature increase the hardware requirements for vehicles or drive up telematics costs?
For instance, enabling customers to view their vehicle’s fuel level through the Toyota or Lexus app increased the
functional value of the app, but also added a data point that the company had to repeatedly capture, transmit,
process, and store:
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 18

To collect and store petabytes of data costs hundreds of thousands of dollars a month. What we had
to do is come up with new, innovative techniques on how to reduce the amount of data and only pull
those data elements where we can quantify the business value versus all of the elements available
from a vehicle. Now we only transmit and store the data that we need, which provides measurable
value. Sounds simple but it was a game changer for us, and allowed us to scale our platform and maxi-
mize profits for reinvestment into more innovation.

BRIAN KURSAR, CHIEF TECHNOLOGY OFFICER, TOYOTA CONNECTED NORTH AMERICA; CHIEF TECHNOLOGY OFFICER
AND GROUP VICE PRESIDENT DIGITAL TECHNOLOGY, TOYOTA MOTOR NORTH AMERICA

SHIFTING UP: SCALING LOCAL INNOVATIONS FOR GLOBAL IMPACT

Through their close collaboration, Toyota Connected and Connected Technologies launched several digital platforms
that provided the basis for new customer-facing offerings at TMNA and TMC. Together, the Toyota Data Services Plat-
form, DriveLink Telematics Platform, and Mobility Services Platform enabled offerings that included Toyota’s suite of
Connected Services, Usage Based Insurance,26 fleet telematics solutions,27 and car and ride sharing programs.28 While
Toyota Connected and Connected Technologies initially designed these offerings for the North American market, by
2021 they were successful on a global scale. This was important, as they required economies of scale to remain viable:

The first forays into mobility were really regional. What mobility looks like in Europe is different from
what it looks like in the US. But the economics don’t work on a regional scale. If you’re putting $300 worth
of equipment in a vehicle and paying a dealer to manage it, there’s no business model that works. But if
you can do it on a scale that Toyota can bring to it, combining local dealer operations with a global mobil-
ity platform, then you can bring a profitable business model to markets where one didn’t exist before.

ZACK HICKS, PRESIDENT AND CHIEF EXECUTIVE OFFICER, TOYOTA CONNECTED NORTH AMERICA; EXECUTIVE VICE
PRESIDENT AND CHIEF DIGITAL OFFICER, TOYOTA MOTOR NORTH AMERICA

To achieve global success, Toyota Connected’s offerings needed to overcome considerable “not invented here” bias
at regional Toyota entities. In fact, within the company’s first month of operations, executives from Toyota divisions
around the world flew to Texas to inform Toyota Connected’s executive team that they were already developing
their own offerings and were not interested in going backward. Hicks and his team knew that these regional entities
would need a compelling reason to adopt Toyota Connected’s platforms, and that localization of resulting offerings
would be important. Toyota Connected therefore opened new offices in Europe (London, 2018) and India (Chennai,
2019) to serve as centers of excellence, leveraging existing platforms to tailor offerings for their respective markets:

There’s no point to just replicating Toyota Connected, because we have already done a lot of things and
developed several platforms. The number one job of those entities around the world is to take those
core platforms and localize them to their regions. Americans will never be able to understand what the
European market wants. So having a European entity allows us to change that.

STEVE BASRA, EXECUTIVE VICE PRESIDENT AND CHIEF OPERATING OFFICER, TOYOTA CONNECTED NORTH
AMERICA; GROUP VICE PRESIDENT, CONNECTED TECHNOLOGIES, TOYOTA MOTOR NORTH AMERICA

26 Usage Based Insurance was an optional Toyota insurance offering that incorporated telematics data to calculate customers’ insurance re-
newal premiums. Customers were given a driver score (on a scale of 0–100) that represented driving behavior. Safe and smooth driving (i.e.,
trips without rapid or sudden acceleration, harsh braking, or harsh cornering) improved the driver score, which was rewarded with savings
on insurance renewal premiums. For more information, see “Usage Based Insurance,” Toyota, accessed December 10, 2021, https://www.
toyota-europe.com/finance-insurance/usage-based-insurance#.
27 Fleet telematics solutions provided on-demand telematics data (such as vehicle location, fuel gauge, tire pressure, and battery charge) to
car rental providers or other companies for fleet management purposes.
28 In 2018, Toyota Connected piloted Hui, a round trip, station-based car share service in Honolulu, Hawaii, operated by Servco Pacific (Toyo-
ta’s distributor in Hawaii). By 2021, Toyota had launched similar solutions globally, including Toyota Share and Chokunori in Japan (2019) and
KINTO across Europe (2020).
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 19

Like its North American counterpart, Toyota Connected Europe was an independent company, with its chief
executive officer multi-capped as the vice president of Connected Technologies at Toyota Motor Europe; this ap-
proach supported buy-in and alignment with Toyota Motor Europe. Zack Hicks became chairman of the board of
Toyota Connected Europe, and Steve Basra became a member of the board of directors of both Toyota Connect-
ed Europe and Toyota Connected India. Multi-capping enabled coordination and the transfer of best practices
among all the Toyota Connected entities. The new offices also enabled Toyota Connected to tap into a more
global talent marketplace:

We have a big need for machine learning and AI resources. India has a huge supply of those types of re-
sources, so let’s leverage that and build those centers of excellence. But we don’t have to be prescriptive;
I don’t want to start up an office and say, You are the machine learning center and that’s it. To me, find
out what needs you have, what resources are available, and then build these centers based upon that.

STEVE BASRA, EXECUTIVE VICE PRESIDENT AND CHIEF OPERATING OFFICER, TOYOTA CONNECTED NORTH
AMERICA; GROUP VICE PRESIDENT, CONNECTED TECHNOLOGIES, TOYOTA MOTOR NORTH AMERICA

The Connected Technologies divisions were crucial to the Toyota Connected entities. These divisions provided
the essential link between Toyota Connected and TMC, ensuring that Toyota Connected’s platforms and offerings
could tie back into TMC’s vehicle requirements and designs. Connected Technologies also provided a springboard
for the global sharing of best practices and ways of working from Toyota Connected, with multi-capped leaders
such as Daniel Hall bringing Toyota Connected’s UX design ideas to all of Toyota as chief UX designer for TMC.

AROUND THE BEND: A SOFTWARE-FIRST COMPANY

In February 2021, Toyota celebrated the groundbreaking ceremony for its latest endeavor: a prototype city of the
future. Called the Woven City29—an allusion to Toyota’s roots as a textile loom manufacturer—the prototype was
meant to be a fully connected ecosystem for researchers to develop and test new autonomous forms of mobility
in relation to smart homes, robotics, and communities. TMC also committed to achieving carbon neutrality by
2050,30 focusing employees on imagining what mobility could look like in a carbon neutral society. Yet the road
to realizing this future was still emerging. Akio Toyoda believed that in the future, the biggest leaps in Toyota’s
progress would come not from mechanical advancements but software:

In conventional product development, the basic approach has been to implement coupled development
of hardware and software. However, with the speed of the evolution of software outpacing that of the
evolution of hardware, exposed now is the coupled-development problem of improvements in product
performance and product value being susceptible to the limitations of slowly evolving hardware. [. . .]
I believe that applying the strengths of our hardware and adopting the thinking of “software first” will
enable us to innovate Toyota car-making to the next phase.

AKIO TOYODA, PRESIDENT AND CHIEF EXECUTIVE OFFICER, TOYOTA MOTOR CORPORATION31

TMC’s new strategic approach made both Toyota Connected and Connected Technologies key contributors to the
company’s future success. Their influence was already coming into focus by 2021, as TMC decided that all newly
released vehicles would be connected vehicles. This meant that all vehicles would have the more capable sensor
suites that Toyota Connected and Connected Technologies had worked on, along with their newly designed mul-
timedia system, which had garnered interest from Toyota operating subsidiaries worldwide:

29 For more information, see “Toyota Woven City,” Toyota, accessed March 8, 2022, https://www.woven-city.global.
30 For TMC’s announcement, see “Toyota aims for carbon neutrality by 2050,” Toyota Motor Corporation, April 19, 2021, https://global.
toyota/pages/global_toyota/sustainability/esg/environmental/carbon_neutrality_en.pdf.
31 “Joint Press Conference by Toyota Motor Corporation and Nippon Telegraph and Telephone Corporation,” YouTube video, 12:51, Toyota
Motor Corporation, March 24, 2020, https://www.youtube.com/watch?v=MHKCD0z4Su4&t=771s.
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 20

We just launched the next-generation multimedia system for the new Lexus NX and the new Tundra,
and my favorite quote from Motor Trends about it is “We’re not exaggerating when we say it’s a mil-
lion times better than the previous generation.” It has been so successful because of our close connec-
tion to the US market, but now it will launch in Australia and Europe as well—even Japan is going to
reuse a large part of it.

ZACK HICKS, PRESIDENT AND CHIEF EXECUTIVE OFFICER, TOYOTA CONNECTED NORTH AMERICA; EXECUTIVE VICE
PRESIDENT AND CHIEF DIGITAL OFFICER, TOYOTA MOTOR NORTH AMERICA

Yet Hicks also saw that the success of Toyota Connected could present a challenge. If TMC was going to rely on
Toyota Connected’s offerings for the global market, it might want to have greater control over the future devel-
opment of these offerings. The rise of autonomous vehicles also meant that the importance of software extend-
ed to the entire vehicle—including driving algorithms. Already, Toyota’s Woven Planet Holdings subsidiary was
working on Arene, a new development platform designed to serve as an operating system for vehicles.32 None-
theless, Toyota Connected would continue to focus on innovation—monitoring new technological developments
such as 5G cellular connections and edge computing:

Our capabilities are only as good as our connection with the vehicle. Plus, there’s only so far we can go
on the cloud. So now we’re looking at edge computing to perform calculations in the vehicle. That way,
we save on communications costs, storage costs, and computing costs. Because as much as we love
our partners, we love our customers more, and we want to make sure that we can provide them these
services at a price point that makes sense for them.

BRIAN KURSAR, CHIEF TECHNOLOGY OFFICER, TOYOTA CONNECTED NORTH AMERICA; CHIEF TECHNOLOGY OFFICER
AND GROUP VICE PRESIDENT DIGITAL TECHNOLOGY, TOYOTA MOTOR NORTH AMERICA

In 2021 alone, Toyota Connected filed twenty-two patents, of which seventeen were granted and one was fully
implemented. The company was valued at approximately one billion US dollars, with many of its offerings not
just scaled globally within Toyota, but to other car manufacturers as well, starting with Mazda. In the span of
nearly six years, this small company operating at the speed of a startup had made a tremendous impact. One
thing seemed certain: Toyota Connected was in a great position to continue to define the future of mobility.

From the start, we wanted to make a dent in the automotive world, and maybe even help humanity
in some way. But I don’t want us to chase size; I want to chase capabilities. So as we launch products,
they have to find a natural home within the larger Toyota, so that we can be free to work on what’s
next that’s going to make a difference.

ZACK HICKS, PRESIDENT AND CHIEF EXECUTIVE OFFICER, TOYOTA CONNECTED NORTH AMERICA; EXECUTIVE VICE
PRESIDENT AND CHIEF DIGITAL OFFICER, TOYOTA MOTOR NORTH AMERICA

32 For more information, see “Programmable Mobility,” Woven Planet, accessed March 8, 2022, https://www.woven-planet.global/en/wo-
ven-alpha/arene.
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 21

APPENDIX A: ORGANIZATION AND LEADERSHIP STRUCTURE OF TOYOTA CONNECTED, 2021

HICKS • PRESIDENT & CEO

■■··■
BRIAN KURSAR

... •· .
SVP&CTO

---
STEVE BASRA • EVP & COO
DAVID TSAI

----
VICE PRESIDENT OF ENGINEERING

..
:,
: . ... ...• . . . . . . •· . . .
.
. .
.
.
.
. . . . . ....
••• .

--------------
-
Legal

Procurement
Finance

Accoontlng
- HR

Talent Services
Corp. Planning

Strategy

BusinessM1mt
Internal Product

External Product
- - -

Workforce
Planning

Comms

Office Mgmt

AgileServices

Source: “Toyota Connected / Connected Technologies 101: Overview.” (November 2021) Toyota Connected North America. Unpublished internal presentation. Used with permission.
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 22

APPENDIX B: STRATEGIC BUSINESS DOMAINS OF TOYOTA CONNECTED, 2019

1. Data: Toyota Connected Data Services

Vehicle data collection, operation, analysis, utilization
2. Mobility: Mobility Service Platform
Car sharing, ride sharing, fleet management
3. Telematics: Toyota Connected Car Platform
Telematics Service Provisioning, Vehicle Service Gateway
4. Innovation: TC Labs
Voice Recognition, Virtual Assistant, AI, Robotic Process
Automation, and more
5. Operations: Pulse
AI Operations

Source: “Toyota Connected North America Overview.” (2018) Toyota Connected North America. Unpublished internal presentation.
Used with permission.
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 23

APPENDIX C: ORGANIZATION AND LEADERSHIP STRUCTURE OF CONNECTED TECHNOLOGIES, 2021

COMM SYSTEMS

REMOTE DCM DCM

SERVICE SERVICES SET

IN-MARKETOPERATIONS& COMMUNICATIONS

BRIANINOUYE
21MM
Group Managrr

DANIEL
HALL
tieMral Managrr

INFRASTRUCTURE/OPERATIONS

BACKEND
tieMral Managrr

FRONTEND

BUSINESSENABLEMENT
& EFFECTIVENESS
PAULASIMAAN

CTCOMMUNICATIONS

Source: “Toyota Connected / Connected Technologies 101: Overview.” (November 2021) Toyota Connected North America. Unpublished internal presentation. Used with permission.
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 24

APPENDIX D: OVERVIEW OF TOYOTA’S CONNECTED SERVICES OFFERINGS, 2021

Wi-Fi Connect
Connect Remote Connect• Drive Connect 3rd party Partnership

© ®.. PROOF

Enhanced Roadside
Guest Driver Dest1nat1onAssist
Assistance

ACN Vehicle Status Cloud Navigation Powered

by
Voice
sos Last Parked Location

Unlock/Lock MarketPlace - TBD

Collision Assistance

Remote Start
SVL

Digital Key

ServiceConnect

3 Year Toyota
Maintenance Alerts
Vehicle Health Report
& Reminders
3 Year Lexus

• NEWfor 2021 Multimedia • Certainremote features may not be availableon all vehicleconfigurations

Source: “Toyota Connected / Connected Technologies 101: Overview.” (November 2021) Toyota Connected North America.
Unpublished internal presentation. Used with permission.
 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 25

APPENDIX E: SCHEMATIC OVERVIEW OF RELATIONS BETWEEN KEY TOYOTA ENTITIES, 2022

TOYOTA MOTOR
NORTH AMERICA
regionaloperating~ub!.ldary of

Toyota Mlotor Nonlh Am.erlca (Plano.; TX),

TOYOTA
Toyota Motor Co:11p
..(Toyota Citv" Japan)
~--
._-- product a~edopcratl g subsIdaryof
..1 TOYOTA
connected
Toyota Cormected North America, (1Plano~
TX)
President ancl CEO: Tet:suo Ogawa President and CEO: Akio Toyoda President and CEO: Zack Hicks.
Chief Digit.alOfficer: ZackHicks Chief 0igi1talOfficer: JamesKu ne r Cnief OperatingOfficer: SteveBasra
TMCregionaloperatln,g subsldl,ary; for
respo1f'ISlble Parent Coml)any: markets vehiclesIn ,over170 Chief TechnologyOfficer: BrianKursar
Toyota's North American !United State5,•Cllnada,and countries and regiom; and conducts itli busines~ TMC subsidiary [175 @mplDV@c?S): responsible for
Maico) sa e_s,marl@tlng:,and dl$1:ributlon.Home to worldwide In ,moI'@' than 51 manufacturingfaollitles providing data and telematics services, as,wel as
~o,,oooempl'oyeesacross5 distributors, 13 in 28countries.and regions developing new offerings based on Al and machine
manufacturing plants, 3 rf!s@arch& development learnIng
sites,and the ToyotaFinandalServicesCorporation

la, n of ·ConnectedTec-hno
logiies(Plano,
1
no
CCl•NNECTED ·GroupVice President;Steve Basra
IC--='-:T: ECHHOUIGIES
TMNAProfit & LossDivision(SOOemp oyeesj;respons ble for the customerexperience,sale.s,and marketing
of connected s,ervices,as W@IIas in-vehidle technology (e.g., head unit) development

Source: Authors' interpretation.

 Van der Meulen, Mooney, and Beath | CISR Working Paper No. 454 | 26

APPENDIX F: SCHEMATIC OVERVIEW OF TOYOTA’S MOBILITY SERVICE PLATFORM, 2021

Service companies

Mobfe
Ride-Sharing Car-Sharing Rent-a-car Taxis Log1st1cs Retailers

APl*l

Utilizing traffic
Smart Key Box/ Fleet vehicle information/
Telematics insurance Flexible leasing Translog management vehicle data

Dealers

■
■
■
■

■ ■

-----------' I
■
■
■
■

I ■ ■
I

: High-freqtEieney
: maintena ce
I
■
I
I •••• ■
I
I
•-----------------------------------------------------------------------------------------------------------J
1
An API is a set of subroutines used to program software. Using an API made it possible to call up the original program and use it to develop software that integrates all of its features and functions.
2
OTA stands for “Over The Air.” It referred to the updating of software via wireless communication systems.
3
DCM stands for “Data Communication Module.” It referred to a dedicated module used for communicating data.

Source: “MSPF (Mobility Service Platform),” Toyota Connected, accessed December 15, 2021, http://www.toyotaconnected.co.jp/en/service/connectedplatform.html.
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MIT Sloan School of Management Team | Christine G. Foglia Associate Director, Nils O. Fonstad,
Center for Information Systems Research Dorothea Gray-Papastathis, Cheryl A. Miller, Ina M. Sebastian,
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