I believe the main thing that should be done is purely a software change. It could be done today for next to nothing. Allow the user to choose between multiple "profiles" depending on different driving conditions that would change IMA behavior, such as more gradual IMA use for mountain climbing, more aggressive use for short but steep grades, etc. Basically, allow more user input as an option. However, this thread seems to be leaning toward hardware changes, in which case I'd like to build on tbaleno's suggestion:

Agreed. Next, I would suppelement the normal battery with ultracapacitors that would be able to deliver a higher flow of current than the batteries alone, to power the motor for bursts of acceleration. Also, for very short-term use of IMA, like stop-and-go traffic, the batteries woudln't need to be cycled at all-- the assist and regen could simply drain and recharge the ultracapactiors, which don't have issues with degradation from charge cycles. The battery (which has a better energy-capacity/weight ratio from what I understand, but a slower charge/discharge rate) could be kept in reserve for things like gradual hill climbs.