After a recent Autotrader study showed car technology trumps brand and color for new-car shoppers, new data from KPMG shows automakers might need to step it up in the tech department even more.

A recent KPMG study, titled, "The Clockspeed Dilemma," shows that automakers may need to start acting more like tech, software and consumer electronics companies. This shift, according to KPMG would include, “more highly customized products, quicker introduction of new, ‘sexy’ models, and nearly flawless quality to address competition from new entrants in the business.”

KPMG says the highly competitive landscape of large technology companies and startups operate at faster “clockspeeds.”

“Albert Einstein’s theory of relativity makes the point simply enough. Einstein taught us that time is relative. It sure is in the auto industry. Car companies obey a pace — a clockspeed — required of capital-intensive powertrain plants, stamping plants and assembly lines, to ensure cars work at Six Sigma quality every time and all the time, from -40 to 130 degrees Fahrenheit,” said Gary Silberg, national automotive leader for KPMG, in the report.

“Now they must also embrace a far faster clockspeed — actually, multiple faster clockspeeds. The faster clockspeeds are the result of new players entering the ecosystem, from technology giants to start-ups. Some of the new competitors operate at a much larger economy of scale. All of them fuel customer demands for cars to be repeatedly new, exciting, and sexy while still holding to the standards of Six Sigma quality. Thus the clockspeed dilemma: the need to serve two different paces at once,” he continued.

In other words, yes, automakers have to remain focused on quality and reliability; but as the tech industry seems to come up with something new and exciting for consumers every month — automakers may need to step up their tech game to keep consumers interested.

"Consumers expect as a given that cars get increasingly better fuel economy, better looking and safer on the road," said Silberg. "But the entrance of tech disruptors has created new expectations about the customer experience. Just look at how the iPhone changed the consumer experience and how we interact with our mobile devices. Auto companies must solve the clockspeed dilemma today or risk becoming obsolete very quickly."  

KPMG explained the crossroads plays out as such:

1. Automakers are familiar with what KPMG calls the “The Robust Industrial Machine,” or that timing that requires a 5-7-year clockspeed for powertrains, vehicle platforms, and other essential mechanical elements to provide a reasonable return on investment.
    
2. On the other hand, automakers are being called to adhere to a speedier pace of innovation, stemming from consumer demand for what KPMG calls the “Sexy Dynamic Experience.” This experience hinges on three elements:

• Products repeatedly evolve and improve after purchase.
• Products are flexible, able to create environments or experience that is configurable with a consumer's tastes or usage situation.
• New enhancements are reverse compatible. They not only improve performance but work with earlier platforms.

Consumers are used to this type of experience with items they use every day such as smartphones and laptops, which are updated and improved on an annual basis.

Silberg said, “The power of the Sexy Dynamic Experience to drive innovation and to change markets should not be underestimated: sexy can kill robust, especially as consumers begin to see sexy as more important than robust.”

In today’s quickly changing market, automakers must continue to focus on reliability and quality, but the new KPMG study contends to stay relevant, the auto industry could serve to take a few pages from the tech world’s play book.

"First, however, a simple truth: There's no single answer to innovating successfully, no one-size-fits-all solution,” Silberg concluded.