CXO

IT leaders: Will autonomous vehicles drive change in your business?

Autonomous vehicles will certainly alter business in the coming years. Here's how to start thinking about the impact before it hits.

Image: Google

If 2015 was dominated by the Internet of Things, 2016 is quickly shaping up to be the year of autonomous or self-driving vehicles. At early auto shows and even CES 2016, auto manufacturers were keen to show off early versions of self-driving technologies, and several manufacturers already have cars on the roads that demonstrate limited self-driving capabilities.

Whether you love or hate the idea of your car chauffeuring you around while you sleep or play with your phone, autonomous vehicles represent a significant shift in culture and business, well beyond a mere convenience feature.

Truckin'

While much of the public attention focuses on fancy Teslas and Audis hitting the highways while their drivers keep their hands off the wheels, there's industry-changing potential for autonomous trucking, and significant investment in this space. Depending on a variety of factors, the preferences for moving cargo and freight generally shift between railroad and trucking, with everything from fuel prices to seasonality tilting demand one way or another. However, even with bulk loads that generally favor railroads, trucks often serve as the last mile delivery mechanism and offer more customizable routing and timing options since they're not tied solely to railroad networks.

However, driver shortages and safety regulations have created challenges in the trucking market. Obviously, no one wants an exhausted driver piloting 40 tons of vehicle and cargo down the highway on limited sleep. An autonomous truck could drive nearly non-stop with the occasional pause for fueling and maintenance. Allowing a single rig to run almost without interruption could reduce shipping times dramatically, and completely change how we think about warehousing and supply chains. Everything from how one designs a truck stop to how we estimate delivery times in our ERP systems could change.

Similarly, local delivery will change rapidly as anything from a tiny autonomous drone to a self-driving electric delivery van can be reserved, dispatched, loaded, and routed automatically and in near real-time. Successful companies will apply concepts and algorithms borrowed from high volume applications like network packet routers to move goods around the world, and automatically route around disruptions. Are your systems ready to adapt to this type of change?

Personal transportation

One major implication of self-driving cars is that they could eliminate a significant share of personal vehicle ownership. If I can summon a vehicle that meets my needs and have it arrive in moments, it could be a compelling alternative to owning a vehicle. This creates far-reaching implications. Where do all those autonomous vehicles go when not in use? Will homes need garages? How will cities manage and communicate with fleets of autonomous cars on their roads? Who will own these fleets?

If your company is directly involved in the automotive or transportation industry then the implications of these changes are fairly obvious, but even if you're in an unrelated industry, these changes will be felt. If commuting is suddenly more rapid and efficient, does the trend toward telecommuting reverse? Will your systems need to manage and dispatch a fleet of autonomous cars owned by the company? Will an ability to move people previously unable to drive allow for new possibilities for your company?

Spend an occasional day in the future

Like all major technology changes, those who have prepared and remained flexible are most able to take advantage of these changes. Your company need not be directly involved in transportation to be impacted by the major changes that autonomous transportation could bring. Spend a few hours each quarter discussing emerging trends with key leaders, and incorporate outside perspectives to gain broader insights. Look to identify trends that you can prepare for. While no one knows exactly what the future will look like, it's obvious we'll have more flexible means of transportation available, which will require flexibility in our systems and business models.

It can be tempting to leave the future to others, happily continuing in your current routine, expecting that other companies will suffer through the initial chaos of change and come to you with proven solutions. While this strategy can work, it can also be a recipe to be left behind in a changing environment, occasionally to the total detriment of your company.

Just ask the horse carriage industry, Kodak, or Blockbuster.

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About

Patrick Gray works for a global Fortune 500 consulting and IT services company and is the author of Breakthrough IT: Supercharging Organizational Value through Technology as well as the companion e-book The Breakthrough CIO's Companion. He has spent ...

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