Think Big With These Five Guiding Principles of Innovation
At last week’s Front End of Innovation (FEI) conference, Vijay Govindarajan of Dartmouth’s Tuck School of Business and the author of The Three Box Solution said “The future comes to us in daily doses”. This point was driven home for me in the recent announcement that came from GM and Lyft, about their plan to test autonomous self-driving cars as taxis as early as 2017. Not only did this give us a glimpse into the not-so-distant future, but it is a great example of a business following our five guiding principles of innovation: Think big, Understand shifts, Look outside-in, Fuse trends, and Think about the “Perfect Storm”.
Thinking Big: The driving factors behind Lyft’s innovation
The most obvious fundamental force behind this announcement is the technology — because without that the dream of an autonomous car would simply be the stuff of science fiction. However, technology itself is not the only factor. Way back in 2000, a third of all Americans1 told us that they would be interested in a car that drives for you when you don’t feel like driving — clearly an early, weak signal that this type of technology was at least intriguing to consumers.
The Perfect Storm: A market poised for growth
The second (and also somewhat obvious) driver behind this announcement is the rapid expansion of the sharing, or access, economy. Back in 2010, we told our clients that the “for now” economy – predicated on consumers’ increasing interest in experiences and liquidity and a shying away from ownership and long-term commitments – was poised for growth. Flash forward to today and we have a world where 59% of global consumers have at least heard of the access economy1 (and 12% report that they have engaged in it). Lyft is one of the dominant players in this marketplace.
Understanding Shifts: What the future will look like
Perhaps not so obvious are some other fundamental forces. By the year 2050, 70% of humankind is projected to live in urban areas1. This is a huge driver with implications across a wide-range of platforms, not the least of which is related to transportation. Beijing has already reported traffic jams lasting 3 days or more – what could those traffic jams look like when that urban population doubles from where it is today? The need for more efficient ways to get from point A to point B is only going to grow.
Looking Outside-In: Giving consumers what they want
Another force is that of an aging population. In most developed markets, we’ve been experiencing aging populations for more than a generation. The real change is going to come in the future, when markets like China and India report their highest ever numbers of consumers age 65 and older. Couple that with the trends of ‘aging my way’ and aging with vitality, and we see the opportunity for autonomous vehicles – ending the need for anyone to have their keys taken away due to physical or mental impairments.
Fusing Trends with the Connected Consumer Index
Lastly, constant connectivity, and the integration with technology that this implies, speaks to the underlying need for a business model of matching unmet needs of consumers in real time. We at GfK have recently launched our Connected Consumer Index, which provides a single measure covering how much, and on what devices, consumers in each of 78 countries and 8 world regions digitally connect with each other and with digital content. The market for Connected Cars has shown steady growth over the past three years, especially in the more developed markets like Hong Kong and North America.
The news of this week does, to paraphrase William Gibson, prove that the future is already here, although not evenly distributed. Following the five guiding principles of innovation is one way to make sure your business is on an even playing field.
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1GfK Consumer Life (Roper Reports®)