I had an idea worth sharing! Make change work for you. And I shared that idea from the red carpet to several hundred TED and TEDx fans recently (and hopefully tens of thousands more when the video is posted on TEDx’s YouTube channel).
Without going into all the details, most people accept that change is inevitable. Many don’t like it, but they still accept that it is omnipresent. To deal with it, we ponder it. We go through the motions of evaluating pros and cons. We get distracted by unexpected disruptions. We then put change aside knowing full well that change has no stop or pause buttons. We behave like change is a train passing by. We get annoyed at the inconvenience but eventually résumé our normal everyday activities.
The problem is that this time the train doesn’t pass. It just keeps coming and coming. And by the time some of us recognize that we need to find an alternative route, it is too late. As the saying goes, the train has left the station!
It’s easy to blow off and even laugh at signs of change. Past success instills a sense of complacency and even justified arrogance when you’ve outperformed and outlasted competitors for years if not decades.
But today’s world is vastly different. The reality is that you can be on the top of the world today and hanging on for dear life tomorrow.
While change may be familiar, the speed and scale of change this time is different, exponentially different.
McKinsey & Company suggests that change is happening 10 times faster and 300 times the scale creating 3000 times the impact than it did just a century ago. And according to A.T. Kearney’s Turbulence Index, our operating environment is probably twice as volatile as it was 10 years ago.
But let me describe this in real-life terms and how a seemingly unrelated change will impact everyone from consumers to government. Let’s take a look how easily the pedestal can be knocked out from under you and how powerful the downdraft can be when disruptive and exponential change is in charge.
Let’s talk about the autonomous (self-driving) car.
Critics and skeptics have long scoffed at the idea of a self-driving vehicle, especially in the near term. That’s a huge mistake.
Just a few weeks ago I was on the phone with the CEO of a large Midwest auto dealer. He suggested we would never see self-driving vehicles outside of California or testing laboratories in his lifetime. That same morning, Uber announced it was putting self-driving cars on the road in Pittsburgh (PA).
If you take nothing else away from this article, I hope you’ll heed this advice: The future is much closer than it seems.
Almost everyone is in agreement that autonomous vehicles will impact the auto manufacturers and their workers. But too many business leaders dismiss the impact it may have on their organizations and even government. The question that every business should be asking is not if you will be affected but how!
The list of industries and business models that will be disrupted may surprise you. The impact of innovative disruption we are experiencing today has a far reaching blast zone that inflicts extensive collateral damage far down the supply chain. (Alternatively, it also creates enormous opportunity depending upon your viewpoint and mindset.)
Here’s just one scenario.
For starters, McKinsey & Company predicts self-driving vehicles could reduce U.S. auto accidents by 90 percent. With few accidents, insurance rates and therefore premiums should plummet.
In a recent annual report filing with the SEC, Allstate Corporation, one the largest automobile insurance companies in the U.S., stated:
Other potential technological changes, such as driverless cars or technologies that facilitate ride or home sharing could disrupt the demand for our products from current customers, create coverage issues or impact the frequency or severity of losses, and we may not be able to respond effectively.
Today car crashes have an enormous impact on the U.S. economy. What does a significant reduction in accidents mean for the auto body shop? What does advanced technology mean for those dependent on the repair and maintenance businesses? What about parts dealers and all the other businesses that supply them, from paper products to office equipment? What will happen to the mechanics and other workers?
Those businesses may seem like obvious victims of an evolving world. The following may not.
Insurers. Ok, insurance companies may take a hit. But how will that affect the tens of thousands of small businesses that depend on selling auto insurance for a living? How will autonomous vehicles impact organizations like AAA?
Hotels and motels. What happens when travelers don’t have to stay overnight when they’re tired? What happens when they just doze while you let the driving to … the car?
Fast food. Ever notice how fast food places proliferate like weeds near highway exits? What happens when people don’t need to stop for gas as frequently?
And speaking of fast food and gas.
Convenience stores. Ditto on the less need to fill up. What happens to all the convenience stores (and employees) that rely on people stopping to fill up on the way to and from work?
Airlines. Is there any airline passenger that isn’t fed up with the hassle of flying? What happens when on-demand autonomous vehicle travel is more convenient than air travel, especially for short trips?
Parking garages. Since driverless car fleets will be moving continuously, it is estimated that 61 billion square feet of parking space in the U.S. alone won’t be needed. What does that mean for companies and government authorities that operate them?
A fatal mistake that executives make is underestimating or ignoring what happens to all the suppliers of the above-mentioned businesses. If convenience stores and fast food restaurants sell less food and gas, what about their suppliers? And what about the impact on the suppliers to the suppliers? If fewer parking garages are needed, what happens to the construction contractors … and so on.
And the biggest wildcard might be this. Federal, state and local governments depend on tax revenues from the sale of gas, parking, food, and other merchandise to fill their coffers. What happens when the revenues of these suppliers shrink? Since autonomous cars will be designed to go the speed limit and DUIs will become irrelevant, how will that affect government revenues? And what about driver license fees? Will people still need to obtain a license if they aren’t driving?
The list goes on and on. Of course, these are projections of the future which are often uncertain. But whatever happens, the wide adoption of self-driving vehicles is much closer to reality than fantasy. We are on the verge of a world with driverless cars and the collateral benefits and disadvantages are inarguably far-reaching. The only fantasy that still seems to exist is that so many executives, business owners, and workers seem to think they will be immune from a massive disruption in the way we work, live, and play.
If not autonomous vehicles, there is a new technology out there—3D printing, artificial intelligence, nanotechnology—just waiting to disrupt your business model and supply chain. Think about it. These are the pivotal questions that must be asked today to challenge false assumptions about the future.
It’s time to make change work for you. Take the lead now … or you will find yourself following change wherever it takes you.
Want to learn more? Download the book preview of When the SHIFT Hits Your Plan (book to be published in 2017).
