Taking a Peek into the Future
As disruptive as the COVID 19 pandemic is; for those leaders who are being attentive to the structural changes happening here and now, we are getting a peek into the future.
I want to focus on one area that I have been writing and talking about for some time now, autonomous transportation. This is not about the race to have the first Level 4 vehicle but rather about the overall impact of having a nation that has migrated to a mostly fully autonomous landscape. Unlike the dreaded virus that descended on us all from seemingly out of nowhere overnight; the evolution to autonomous transportation will unfold over the years. The changes to our lives will occur more slowly, but the impact to workers and the economy, if not planned for and managed carefully, will not be without some disruptive upsets.
Doing a quick look at the data; in the US there are roughly 6 million automobile accidents a year, or 16,438 a day. Due to the annual 6 million accidents, approximately 4.4 million of us get injured, with more than 38,000 deaths due to the injuries sustained. These are terrible statistics. The automotive industry along with the Federal Government have been chipping away for years to reduce both the actual number of accidents and the injuries caused. Solving for this has always been one of the great promises of an autonomous environment; zero or close to zero accidents and no more injuries. We all look forward to that day, but along the journey what should we be thinking about and more importantly doing?
As I stated at the beginning, this crisis is providing us with a glimpse into tomorrow. Can we see it? If so, are we beginning to build our plans for the future? The fully realized end state of autonomy would perhaps bring an end to most automobile insurance coverages and claims (insurance company revenues, employees, and their ability to fund and backstop other businesses). We would see the decline in insurance agencies, repair shops, tow trucks and their drivers and so on. Even now, some of you may receive a refund for a portion of your insurance premiums as we are not driving as much and causing accidents. Just think about the magnitude of change for when there are no more accidents. Along with insurance, repair facilities, other supportive activity will also be impacted, including attorneys and courtrooms. Another industry that is being impacted today by having fewer cars on the road and perhaps more so in the future is health care. As hard as it is to believe, during this tumultuous time we are hearing about the closing of medical practices and doctors and nurses being laid off. Surely, a cause of this is the reduction in elective surgeries along with people’s unease of entering into a medical facility. But I would have to think that this is also brought on by the reduction of injuries and subsequent medical treatments from having far fewer automobile accidents and their attentive injuries. It also goes without saying, but a mention for a lowering demand for new vehicles and vehicle replacement parts is a certainty. For some, this future sounds exciting. For others, specifically those in the industries referenced above, this may sound scary as your industry may be completely different in not only the future, but the near-term future. But there is good news: by seeing it now, you have the opportunity to prepare. What new opportunities will be created by autonomous vehicles that your organization can grasp on to? How can you pivot your services to support customers in this future world? Can you use this time of disruption to move ahead of your competitors? We encourage you to find the silver linings in this time of disruption and to better prepare yourself for future disruptions.
Autonomous transportation is just one area and there are many others where our collective response to COVID 19 is forcing (or allowing) us to try new and different ways to get our needs met. Education, entertainment, sustenance and interpersonal connections all come to mind, After ensuring the health and well-being of those around us, as leaders we need to be paying attention to how the world is reinventing itself and to prepare ourselves and our teams for the future.
Tim McCabe is a CGS Fellow helping to lead clients through significant transformation. He is a former global CIO and officer of Delphi Corporation where he helped to lead through the restructuring and digitization stemming from the largest industrial bankruptcy in history. He can be reached at Tim.McCabe@CGSAdvisors.com