Why Accenture Is Buying ESR Labs

By Noah Long ● March 11, 2020
  • Accenture recently announced it agreed to buy ESR Labs, a Munich-based company that builds embedded software for leading German car brands and suppliers

Accenture recently announced it agreed to buy ESR Labs, a Munich-based company that builds embedded software for leading German car brands and suppliers. And the acquisition will expand Accenture’s capabilities to help its automotive clients drive greater value from software.

What is embedded software? Embedded software is the code that runs on the electronic units that control a vehicle’s functions. And writing it requires a scarce set of experience and skills that the 130+ software engineers and software architects from ESR Labs will bring to Accenture. ESR Labs also offers solutions to update the code remotely and helps clients develop connected car and mobility services like car-sharing and it conducts research into autonomous driving technology.

ESR Labs is going to join Accenture Industry X.0, the part of Accenture that uses digital technologies to improve how companies design, engineer, and manufacture products and services, and operate industrial facilities. And ESR Labs will join forces with two other German acquisitions for Industry X.0, including strategic design consultancy designaffairs and technology consultancy Zielpuls. The companies will develop mobility services for carmakers as well as smart connected solutions for medical technology, industrial equipment, and high-tech companies.

ESR Labs is going to be the latest acquisition that Accenture has made for strengthening Industry X.0. And in February, it acquired VanBerlo (a Dutch product design and innovation agency). In 2019, it acquired US product innovation and engineering company Nytec and UK innovation firm Happen. A couple of years ago, it bought US embedded software specialist Pillar Technology and US hardware engineering firm Mindtribe.

Accenture has 505,000 employees serving clients in over 120 countries. And Accenture Industry X.0 helps businesses master the digital reinvention of industry when they use advanced digital technologies to transform core operations and unlock new revenue streams and business models. 

The completion of the acquisition is subject to customary closing conditions. And the financial terms were not disclosed.

Key Quotes:

“Manufacturing companies need to put software at the core of their business. They also need to adopt and nurture a technology company-like ‘pure developer culture.’ ESR Labs will put us in a great position to help our clients accelerate their plans to do just this.”

-Andrew Smith, a managing director for Accenture Industry X.0 in Germany

“The automotive industry is at a tipping point. Globally, car sales are declining. Customers are demanding more convenient and customized mobility services. Whoever meets these demands best, will win mobility in the future. With ESR Labs, we can help our clients in the automotive sector embrace and implement new technologies much faster.”

-Axel Schmidt, a senior managing director and Accenture’s global automotive lead

“Bringing together ESR Labs, designaffairs and Zielpuls will go a long way in helping clients in our market tackle their digital challenges. Together, we can help them develop some of the world’s most innovative and high-quality products and services.”

-Frank Riemensperger, market unit lead for Accenture in Germany

“We’re excited to become a part of Accenture Industry X.0, which will allow us to create groundbreaking technology solution for clients faster than ever. Accenture’s truly global organization will also offer new opportunities to our people.”

-Wolfgang Köcher, CEO of ESR Labs