This thesis examines how and why the German automotive industry is changing IT sourcing
strategies in response to the implications of digital transformation. Due to megatrends such as
decarbonisation and digitalisation, the industry is undergoing its greatest transformation in its
existence. The future success of the industry depends heavily on the level of digital innovation,
for which IT sourcing is becoming a strategic function to provide critical capabilities and
resources. The industry has made a strategic shift and recognised software as a key technology
that will dictate long-term success in global markets. Transformation processes have begun to
span the areas of digital processes and automation, connected cars, and mobility services to
facilitate software-enabled automotive companies. This is leading to new IT sourcing models
in a variety of configurations.
This research is based on the constructivist perspective, with its associated interpretative
research methodology. The thesis centres on a single-case study of the German automotive
industry as a whole, where a change in the ratio between insourcing and outsourcing has a
significant impact on in-house employment and third-party business operations.
The approach is qualitative and started with an online survey for framing areas of discussion
for the subsequent 19 semi-structured interviews with IT managers and sourcing experts. The
analysis of the findings resulted in 15 emerging themes and the development of a blueprint for
the transitioning of IT sourcing management, requiring a redistribution of IT responsibilities
between Business and Corporate IT.
The blueprint contributes to both theory and practice. The principles for a reallocation of IT
sourcing responsibilities and the resultant organisational consequences are set out. The
blueprint can be set alongside existing models of sourcing transition, and acts as a guide for
practitioners in the automotive sector charged with overseeing change in sourcing management
in the digital era.