… Surprisingly, newcomers or even a start-up have the opportunity to put themselves in pole position to win the race. To understand why, let’s begin with a story about the likely near future experience of the car.
“This morning, as I got ready for work, I used the app on my smartphone to order a car. Today, I needed to take the children to football practice on the way to the office, so I ordered a four seater. Since I usually commute alone, I had to make a change to the pre-scheduled one-seater that normally collects me.
At the designated time, a driverless car pulled up outside the house and a push notification on my watch alerted me that it had arrived. The car door was opened by a retinal sensor. Once we were all inside, I used the voice recognition system to confirm the various destinations and the car automatically set off.
We took the most efficient route as determined by the on-board navigation system in coordination with the city’s intelligent transport matrix. Our arrival times were accurately predicted in advance and the experience was safe and pleasant.
The new electric cars are quieter and cleaner than the cars of my childhood. Moreover, driverless cars have all but eradicated accidents and there are less cars on the roads as a result of the managed traffic flows.
In the absence of anything to do, my only task is to sit back and enjoy the ride. This suits me, as I never actually learnt how to drive. My children used the journey to watch a TV show on the main in-car monitor. I sent a couple of emails and prepared for my first meeting.
Since I needed to work late, I booked another car to collect the children after practice. At the same time, I arranged for a car to pick up my parents for a barbecue tomorrow afternoon. It will be nice to see them, although I wish my father wouldn’t complain to the children about how “a driverless car isn’t really a car” and how much more “exciting” it used to be when he was able to drive for himself. Somehow, I find his nostalgia irritating.”
The car of the future — for convenience, we will refer to it as the “intelligent car” — is no longer the stuff of science fiction, but represents the coming reality for both the automobile industry and consumers. There is surprisingly little disagreement about where the industry is heading, at least in terms of core technologies.
Disagreements tend to focus on the time-scale for the roll-out of that technology, the transition period whilst intelligent cars co-exist with current “driver-driven” models and, most importantly, who will build the next generation car? Will it be one of the established car companies, such as GM, or will it be Tesla, or Uber, or any other established or new technology company?
In response to these questions, the future of the car industry — or any industry confronting profound technological change — will not be determined by developments in the technology — i.e., who outpaces the competition by developing the “best” engine, chassis, design etc., and the associated IP rights — but rather by the structure of the firm and the capacity of a firm to meet the design challenge associated with assembling the products or services of the future.
This challenge of re-imagining the meaning of the car is as much a question of design as it is one of technology. Design focuses on understanding an area of human experience and then developing a product or service that utilizes technology to improve that experience and empower people in new and previously unimagined ways.
Delivering a new experience — i.e., meeting the design challenge of the intelligent car — is contingent on the organization and governance of the firm. Those firms that embrace a particular type of organizational form will be better placed to deliver a new narrative of the place and meaning of the car in everyday life.
On this type of account, developing new technology will be less important than imagining, gathering and then integrating technologies into a meaningful whole.
The future of the car industry will then be determined by the companies who are best able to adopt an open and inclusive “ecosystems” built, in part, around new forms of relationship with other companies universities, governments and society. The distinctiveness of these ecosystems is that they implement practices and processes that better equip them to be constantly re-inventing themselves in delivering products and services…