The driverless car is one of many emerging future scenarios that drive multiple paradigm shifts. As these shifts converge, they intensify the critical need for leaders to think differently about a world where the future arrives faster than people think. This speed is unappreciated, undermining the levels of urgency required to survive in this exponential age. I sat with Chunka Mui recently to discuss these shifts, using the driverless car to explore the challenges of our emerging future.
Chunka Mui is the managing director of the Devil’s Advocate Group, a consulting group that helps organizations design and stress test their innovation strategies. As a consultant on strategy and innovation, Mr. Mui has spent considerable time analyzing the driverless car scenario. He asked a question in his book The New Killer Apps about autonomous vehicles and what happens if traffic accidents are reduced by 90% as Google predicts. This simple question makes visible the broad and deep implications of these future scenarios. As society responds to their implications, new ecosystems emerge that alter our world. In this case, the driverless car is one of numerous components of an emerging mobility ecosystem that is defined by the responses that are playing out right now.
I will share insights from our interview in a series of posts, starting with this one. In this segment of the interview, Mr. Mui and I discussed the growing need to rehearse the future.
Frank Diana: Let’s start with a question around future thinking. As mentioned, the future is coming rapidly and our lens has to change. I know you talk about this as you help leaders through their innovation strategies. So first and foremost, what is your perspective on future thinking and how do you coach leaders to think about the future?
Chunka Mui: One of the things I often tell my clients is that Dwight Eisenhower was right when he said: “plans are nothing, but planning is everything.” When you’re talking about successful innovation, it boils down to six words: successful innovators think big, then they start small, they learn fast and fail once. Scenario planning is a core part of thinking big in the right way. By thinking big, I mean that successful innovators are the ones who look to the future and consider a whole range of possible scenarios, because there are so many things happening as you alluded to earlier. You just can’t predict exactly what’s going to happen, so you have to be very expansive in your thinking. You have to be not so proud that you don’t explore the downside scenarios, and understand how new developments might actually go against you and help drive you out of business.
At the other extreme you have to have the audacity to say; what if I could start with a clean sheet of paper? What if I could build and pursue killer apps and a whole new generation of goods and services that might create whole new markets or disrupt preexisting ones, such as your own? So, being able to stretch the range of possibilities and understand the whole range of scenarios is the most important thing to do, because that is how you start, that is how you understand what might happen and what you might have to prepare for.
Frank Diana: I really love something you said in a recent article around “patient urgency.” I think that captures it well; the need for urgency, but at the same time not moving too fast. How do you talk to leaders about that?
Chunka Mui: Well, I think they all realize that the best thing in life is to know exactly when a technology is ready and when the market is ready for it. But there are too many variables involved. There’s really no empirical way of predicting the future. So the question is how do you get ahead of the game, get ready, and be there when the market is ripe.
Frank Diana: sticking with the theme of timeliness and when to act, let’s pursue the driverless car scenario a little deeper. We’ll start with the timing of mainstream adoption and when it becomes something for leaders to worry about. Insurance is a great example, and I know you’ve pointed to this as well. If we do eliminate 90% of traffic accidents, what happens to the need for car insurance? Insurance executives are struggling with driverless car timing, and there are a number of folks talking about a mainstream 2025 adoption. Yet there are others that talk about a 10 to 15 year window to replace the global fleet post adoption. So what’s your thought on when insurance executives and others need to worry about the driverless car?
Chunka Mui: Well, I think that predictions that try to pinpoint a date are exactly what companies can’t do. They can’t say, “When will this hit some kind of maturity point and therefore when do I have to start worrying about it.” I think what they have to understand is what are the milestones between here and there; because the winners in the end are the ones who are ready as opposed to the ones who are waiting to start. So when I talk to insurance companies in particular, I ask them questions like: What happens if we have this arms race in terms of the automotive ecosystem working on autonomous technology? What happens if that gets peeled off into incremental products that don’t get us to autonomous driving, but dramatically reduce the accidents that occur?
You know, as you said, Google has talked about eliminating 90% of accidents, and that’s actually a fairly plausible number because 94% of accidents are due to human error. So if you can automate the technology such that users of the technology aren’t making mistakes in the use of those products, then you might have a dramatic effect. What happens if we can eliminate 15 or 30% of accidents? That starts having pretty dramatic impact on industry as well, because in the US alone we spend $200 billion a year on auto insurance premiums. If the accidents went down by 50%, that number would drop dramatically because it’s directly correlated to the number of accidents and the cost of those accidents. So the industry might be looking at a premium base that’s half as large if we reduce half the accidents or a quarter as large if we reduce a quarter of the accidents. And that has tremendous economic impact.
Frank Diana: So you don’t have to have critical mass for industry to be impacted, I think is the take-away there.
Chunka Mui: yes absolutely.
Frank Diana: Okay, you’ve talked about not being able to predict – and I completely agree with that. I like to think about this in terms of rehearsing as opposed to predicting the future. I know you talk a lot about a portfolio of options, which I think is along the same lines as rehearsing the future. In rehearsing this future around the driverless car, you mention milestones, markers, things to look for, obstacles, and accelerators. I imagine those are all things that leaders need to start to consider to at least have a number of scenarios in front of them that could talk to potential paths. Would you agree?
Chunka Mui: Absolutely.
Since sitting down for this interview, an article appeared on Recode that rehearsed a potential future for the driverless car and produced a possible Timeline. Given the dialog that Mr. Mui and I had, I followed up and asked him for his thoughts on the timeline. This Twitter interaction provides a glimpse into his thinking:
It is always great to interact with Chunka Mui. I’ll share his additional insights from this interview in future posts.