Do you really understand where your competitors are coming from?
A long and recommendable article in The New York Times for anyone interested in the dynamics of innovation, “Can Ford Turn itself into a Tech Company?” looks at the US car giant’s progress in autonomous driving, outlining many of the trends I have had the opportunity to observe in the company thanks to its many invitations to study its activities in detail.
I have gone to two North American International Automotive Shows (NAIAS) in Detroit with Ford, been introduced to many of its top executives, I have attended project presentation events as well as the Mobile World Congress and other leading trade fairs, and have even had drinks with the executives of some of its cutting-edge projects. This is not just any company, but one that has survived major crises and that looks to meet the future through cultural changes, by attracting new types of talent and developing new skills. Can Ford can become a technological company? I would say yes, it definitely can: I have seen entire departments there led by software development enthusiasts, tinkering and experimenting, the sort of people who would never have expected to work in a traditional car company, suggesting to me that the company is well-placed to confront the challenges of the future.
At the same time, I have also noticed how the structure of an automobile company limits its ability to accommodate these types of competitive dynamics. From my first visit to Detroit in 2013, when Google’s self-driving project was just an announcement stating that its product would be ready and circulating with real passengers within five years, the response of Ford’s engineers to the topic showed they were unaware they were going to have to compete with a completely different animal, with a type of company that in no way resembled its traditional competitors. This started with denial: “Google is not a threat because it will never manufacture vehicles,” or: “making vehicles is too complex a business for anyone other than a car company to get into,” and: “we are protected by many decades of experience and know-how,” along with: “people do not want their vehicles to drive autonomously, they just want driving aids.” The general consensus in the company was that if it came to it, Ford could overtake Google — later split in Waymo — with a bit of effort.
Fast forward to 2017, two years ahead of Sergey Brin’s 2012 prediction, and Waymo autonomous vehicles are now weaving their way through the traffic of downtown Phoenix, Arizona, transporting hundreds of volunteers as part of a real-life conditions road test. The company has not only implement its road map, but has beaten its own deadlines, while Ford and the other traditional car manufacturers are still in the early stages, slowly and painfully progressing through the five levels of self-driving while Waymo leapfrogs the problem by starting at level five by forgetting about human drivers all together.
How to compete with a company that takes such a radically different approach to other automotive companies? Faced with the progressive innovation of traditional automotive companies, Waymo ditched the usual assumptions, rethinking in a radically different way cars and driving, as only a company with no experience in the motor industry that doesn’t have to deal with the restrictions facing its competitors. A totally fresh approach focused and with no distractions that has produced much more efficient results and that has put a fleet of completely autonomous vehicles on the roads in record time, while its competitors, even if they had been able to innovate at that speed, would have had to protect their investments and traditional businesses.
While Waymo has put its autonomous taxi service on the road by 2017, the big car companies still believe that no real change will come until 2030 and that they will be able to continue selling their products with slight improvements. Good luck with that one.
Nobody, not the traditional auto companies, new entrants like Tesla or new competitors that have emerged from other models such as Uber or Lyft has been able to offer any real competition to Waymo, a competitor from another industry with no previous experience in the automotive world, but with a level of focus and a radical approach that has left the other drivers on the grid, still starting their engines. When your competitors come from sectors you do not fully understand, you have a serious problem.
The leader in autonomous driving does not come from the automobile sector. What’s more, when it threw the gauntlet down back in 2012, the idea was still widely considered the stuff of science fiction. The motor industry’s big players have now finally woken up to the reality of having to forge new alliances if they want a slice of the self-driving pie or to be left behind in a dying industry. What many of them still don’t realize is that their competitors are already preparing for the next war, one that many foolishly still dismiss as science fiction: flying cars.
(En español, aquí)
