Reimagine Mobility Podcast: Competing in a Connected World of Mobility w/ Gregg Garrett

Reimagine Mobility Podcast: Competing in a Connected World of Mobility w/ Gregg Garrett

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Welcome, everyone, to the latest edition of the Reimagine Mobility Podcast series. I'm here with Greg Garrett, a consultant in the Connectivity and Connected Vehicle and connected as a general space and also a personal friend. So thank you, Greg, for joining me here today. We're looking forward to hearing from you as a as a consultant in a in a connected world that has far advanced over the last 5 to 10 years.

So maybe to start out with maybe quickly explain what you're doing nowadays and then let's get into what you see as mobility and connectivity and connecting and competing in that world. If we bring all this together, what you understand of all this. I'll just add. No, no problem. First of all, thanks for having me. First of all, we were just talking before we had recorded that you were on my podcast years ago. So helpful in helping me get my my podcast launched. So it's great to return the favor here.

So thanks for having me. Yeah, I mean, really simply put. I've been in and around the mobility automotive space for a number of years as first as a consultant with big company Ernst and Young, and then joined some subsidiaries of Volkswagen and then did some stints with some some other German firms, Deutsche Telekom. Really looking at connectivity well beyond the auto industry and then back into the auto industry and then joined VW proper as the as chief strategy officer, variety and innovation.

And that all ended about 11 years ago. And I took all that experience and teamed up with some folks that were with me along that journey and launched CGS Advisors and we advise leaders how to better compete in the collecting world for the most part. And that can mean a lot of different things.

Sometimes that's helping them to find their strategy, their business strategy, their corporate strategy. Sometimes it's helping them think through their technology strategy or enable some aspects of it. A lot of times it has to do with removing inertia because big, successful companies that have maybe maybe competed in one way before connectivity was such a big thing. They need to really think of how do they remove the barriers, how do they make change real to to drive it out? And sometimes one of those answers is innovation. So helping them set up innovation practices. So we've been doing that for about 11 years.

Big companies, small companies, startups, everything in between have a lot of fun. Yeah, I think at the tail end you asked me to just kind of reflect a little bit on what mobility is and what connectivity or what the connected world really is. And maybe to to answer is connected world first. We look at that as really the world put put the human in the center, but the human on the outside, we've got a picture that we use oftentimes. The world used to be pretty simple hundreds and thousands of years ago before there was a lot of a lot of things in the world, a lot of technology in the world. People sat around the campfires and they gathered and they communicated and they survived and they built ecosystems.

But micro ecosystems, we've made the world pretty complex. A lot of things, a lot of places, a lot of modes of transportation, a lot of information flowing. The connected world is really all those things interacting, and we think that the world's moving towards more and more of those things, being connected, producing information. And if we do it right, that should make life simpler.

It should make things easier, it should make it less friction filled for all those humans that are in that world. We do it wrong. That's less secure. It's more friction filled, a lot of things that don't integrate.

And it's it's a connected world. But but in some ways, a much more disconnected world because we've got to work through all those barriers. So we're trying to see the world through that positive lens of all these things. We like to say everything is becoming everything, a big network of things. And some of those things are mobility. Some of those things move and I mean those classic definitions of movement of people and goods and information and.

As. Someone smarter than me said on one of my podcasts about a year ago, mobility is more about moving people less these days. Probably it's it's about moving goods and making life friction frictionless to bring bring the right information or the right things to the people, and sometimes bringing the people to people as well. But it's all those things.

It's it's the movement within that connected world that is mobility for us all now. Very good. So when you think about the shifts in mobility and you and I often have have discussions about that when we get together on how fast, let's say even connectivity has has improved from 15 years ago when I first got into telematics. Right. And you and I got to know each other, too, today. I mean, back then, you know, when we had a 3G signal, we're like, yes, you know, today if we don't have 5G, it's like, oh my gosh, it's slow.

I can't deal with it. So certainly a lot of stuff just in the traditional connectivity, but it's not necessarily where you are. And it's not just cellular connectivity is the connectivity of lots of different things and how different pieces come together.

But when when we look at mobility, what have you seen changing and what what does this mean to you? That's today, as far as I know, at least, you know, you're doing your consulting as it relates to how do you compete in a in a connected world or a ever more connected world in for health care? You do it for telecommunications, you do it for automotive company. So really not just mobility itself, but if you look at how mobility has changed, how much is the connectivity a part of that? How much is it an influence or how much is it aside product share a little bit aligned from your perspective on that? Yeah. So I mean, first of all, there's so many terms out there and we years ago maybe inappropriately, we, we kind of had decided to latch onto this connected world term which some people, as you said, some people will interpret that as meaning it's really the connections itself.

It's the it's the infrastructure, it's the telecommunication. It was definitely influence during my days at Deutsche Telekom. It was more of terms that were coming out of the telecom space. But you're right, we see that as it's really all the interoperability, it's the blurring of all these things, blurring of industries, blurring of of the experiences that need to inform one another across someone's daily life, sort of bringing back what are we seeing and the acceleration of what we've seen as a lot of actually the technology. So we would call this the grouping of technologies, the connected world technologies, no matter if that's the cloud infrastructure or if it's the 5G or other communication technologies or edge compute things getting small enough, fast enough, that has to be able to embed inside of products, whether they like contact lenses or grains of rice sized pills that go inside of humans bodies, just all the things that can go all the way to the edge where processing can actually happen to the ability to for people willingness, humans, willingness to actually generate information.

We've seen all these basic changes of technologies in the application of the technologies be pre invested in. So the last several decades this couldn't have been imaginable. And we when you and I were first meeting because the capital cost for a lot of these industries and the way that their businesses worked would never have been able to afford all this technology investment all over the last couple of decades, investments been made. And now, and especially with new pricing models around some of the technology, you can just, you know, rent the rent it, everything as a service, if you will. It's all we've seen as disruptive business models, that technology has already been invested in the application of the technology is starting to happen.

And so what we're seeing accelerated is companies applying that technology to disrupt their industry, which really means they're using it to try to drive different business models. It really means their corporate strategy, the business that they're in, is starting to shift. And if it's not that, it's definitely the way they compete. Their business strategy is starting to shift. And so that's what we're seeing is new entrants, disruptive forces, two markets, a race to access particular capabilities that are necessary to compete in a different way.

That's what we spent a lot of time doing, is helping firms think that through. Is are they are they being disrupted? Could they are they in a position that they control a set of resources that they potentially could be part of the disruptive force? And if regardless of either one of those or more functionally, what are they going to do about it? How are they going to deliver in this connected space? That's the majority of time. What we're spending and spending time helping clients do. And it is it's just getting faster and faster before people that are deciding to sit on the sidelines and see, you know, let's let's see how this connected world plays out. They're just being left left out.

They're losing market share. They're being locked out of ecosystems that are that are necessary to be in the middle of play and they're not going out of business yet. Most of them are. But it's the yet that they should be concerned about. If those ecosystems cement getting into the ecosystem later is going be hard, it just can be a slow drawdown for some of these traditional players.

And so we're trying to help leaders battle and get in front of that that that change. And you've you've you're the author of this of this book here Competing in the Connected World. Right. And and you know, you've given me that as a present while back in the I still oftentimes remember when I read it the first time how a lot of things made perfect sense. But I think it was the individual Lego pieces that made perfect sense, but not necessarily recognizing that when you bring the stuff together, that's really when the connected world really starts to bring benefits for an individual, for a company, for an entire society.

Right. And in always recognizing, again, another example of one plus one might be three and not two in this case. But if you take that book for a moment and and it is not necessarily focused on on the mobility space, on the automotive space, but how does that the context sort of things that you're teaching or highlighting in this book really apply to the mobility space? But I think it's important certainly at AVL right? There's a lot of things that five years ago we didn't consider the cloud for.

We didn't consider connecting with other products, connecting with some of our capabilities and technologies. Today we do or today we're certainly on the path to do it. Maybe not fast enough, maybe too fast in some cases, because the market might not be ready. But how do you see your book apply to what you're talking about, to the mobility space now? Thank you for for for showing it.

And and you've been a great partner along the way, especially coming into the classroom where we use the book to teach in the MBA course. You've been a guest lecturer for as many times, being the expert in the auto space. So I should turn the question around to you because you you actually represented to the students quite a bit. But generically, maybe a couple of things.

First of all, the the book it was coauthored myself and my coauthor, Dr. Warren Ritchie, we cemented a lot of the concepts while we were actually out of big global automotive company, a product company, an OEM, because we felt the early aspects of how this connectivity, the shifts and capabilities that that would allow a company to compete differently either against us or us against them, we could feel that. So it actually shaped what's in the book. So even though it's not about mobility, a lot of the examples, the framework was written while we were there together. Really originally some of the concept started coming clear. Secondarily inside of it, you'll see that the book traces through a framework of transformation.

We call it the First Mile framework. It's the first mile of transformation. And as you said, there's no really unique one piece of this framework, but we think the uniqueness is actually putting it together. So just very quickly, there's a a layer that explains what happens at industry as new technologies come out. Why do they why does disruption happen to industries? There's a layer that's around the firm.

So what does a company in that industry need to do? Creating new strategies, trying to understand what capabilities are necessary? How do they get access to the capabilities of actually doing something with them. And maybe the most interesting, one of the most generic, the one that could apply to really any firm is the leadership level at the very top. And it basically just takes you through three steps that you need to imagine what the disruptive potential of these changes might look like that will allow you to then support new strategies and new capability building you need, then assess where you are. Do you have these capabilities? Do you have access to these capabilities or you don't? If you if you're a leader of a firm that has a lot of the capabilities that are necessary to compete in the future and your future business model, you will likely see this as an opportunity and you will run towards it. If you on the other hand, are a leader inside of a firm that looks at all the capabilities necessary.

And you say, Actually, I don't have many of those, you will potentially be desperate a little bit fear based. And you also may run to it, may need to do something a little different, like sell a division to get enough capital to be able to acquire the new capabilities. And then the third step is actually having the bravery to do something because all those first two are really planning it's perspective setting and planning.

The last one is actually being brave enough to do something, and that's where you have to remove a lot of the inertia. How does it apply to the mobility? Well, that's what's going on in most of the mobility market product companies becoming service companies, new entrants that have built their company on all new sets of capabilities, competing against more traditional firms that were built maybe in a different time, no matter if that's the powertrain, ICE moving to EV or unconnected product companies individually. owned moving towards more connected fleet pay per service, maybe more fleet management being what was an OEM may actually be more of like a tier point five now because they're building vehicles for fleet companies and still having some kind of involvement. All these different aspects apply to mobility companies, they apply to healthcare companies in the last piece is because those industries are blurring. Two things are happening. One, you're competing the exact same skills that are necessary for the mobility company and say, Let's take something like AI.

It's being applied at the same rate, the same desire as a health care company. So you're competing way before you would just be competing for mechanical engineers perhaps. And you and the and the competition set was much different. Now you're competing for data. Scientists are people that are experts in AI. All industries are competing for them at the same time.

So the competition landscape is really, really shifting. And then secondarily, it's just human nature. Dominant logic exists and every leader leaders are usually there because they've succeeded. They need to break some of their own rules to be able to succeed in a new way. So the framework, the book just makes people think it's a guidebook.

It's it's written for the top leader of an organization and anybody else who wants to be a top leader to just think differently. And and it's just a reminder, there's as you well said and all around with this, there's no one aspect of it that that should, when you read it, say that's new. But putting all the thoughts in one place might be new.

And that's what we tried to do. And I hope some mobility leaders might get some value out of it. Well, I got I got an alley out of it, and I like to believe that I try to apply some of that thought leadership or certainly the technology leadership that I believe is really what's pushing forward mobility space. The book certainly has helped me tremendously, maybe, maybe touching upon the the point of you also lecturing at an Auckland university here in Michigan and giving me the opportunity to come in and guess lecture.

Over the last several years, you've given me the title, sort of talked about, you know, from automotive to mobility, which is a very, very, very fitting terminology because again, you and I have talked about this numerous times and you alluded to it in some of your areas already to it answers already to it is the industry, the automotive industry really has has transformed itself through a lot of causes, a lot of disruptions and transformation movements. Right. And I think the key here is disruption and transformation leading to new innovations truly from, let's say, automotive to much more broad mobility on the ground, in the air. All over the place. Right. When you look at, let's say ten years back to when you first started teaching at Oakland, what what has the student body changed as it relates to mindset of the connected world, mindset of the mobility world around them? It will be interesting to see. Do you see a trend in the students more picking it up and moving faster? Do you still see somewhat of a Until they read this book, it just wasn't obvious, but then boom, it becomes obvious or share a little bit about that.

Yeah, I think the biggest difference that maybe the most obvious difference I'd say, is when I first launched the course, first of all, I had no idea what I was doing and they invited me. And so thanks Oakland, but I've figured it out over the last ten years. But one of the first things that we would talk about is in the first lecture series of the first, the first class is I'd ask the students to imagine what the things that could be connected in the world and they would struggle. And so I would have to explain to them, Well, let's think through why this desk might be connected, literally to walk around the classroom and give them ideas of how inanimate objects, objects around them might be connected and how they would bring different value if they were, etc.. Well, shift that ten years and the question has actually changed. What won't be connected? And they struggle with what won't be.

So at the beginning we had to explain what what a connected product was, what a what a product that would provide a service is why information would flow. It was it was a real slow and then it would accelerate quickly. Now it's almost the opposite is they just assume everything's can be connected. What I would say is similar and on the other hand is the thing that hasn't accelerated quite as fast is people now know everything's going to be connected. They don't quite understand how how to compete in that space or specifically how to make money in it. And I see this not only in the classroom but also in the entrepreneurial space.

A lot of times people say, well, data, the data will will bring the value. Oh, that's interesting. Nice broad statement as an investor. Okay, I'll just I'll show up now. But how how is it going to bring the value? And that hasn't changed over the last ten years. There is some there's some people that are imagining collecting some really interesting things that can can be collected now because of all this investment. But

why someone of high any value, how you can make someone's life easier? Where are you going to remove costs, How is this information going to be consumed by some other company that will then be able to write that? Still people are still struggling with that. So I think that's I think that's really the struggle of the executive. Oftentimes, whether it's helping a need to support what the product strategy is going to be, that still seems to be the classic issue that I think we'll still get a few more years out of that in the classroom. Interesting.

Maybe I'll put you on the spot a little bit with this one. But if you as a professor, right, which you are part time professor, if you have to grade all the executives that you've worked with so far over your 11 year career in the in the consulting space, related to how much do really grasp the concept of competing in a connected world again, exactly what you just said. Yeah, I need my phone. Connected, of course, but I also need my water company, my money, my desk. I need my computer, I need my car, I need my everything connected to the cloud that's almost quote called the obvious and given now, right.

That we recognize that I hope at least. But recognizing as how you as a leader are supposed to take that and now compete within it, find a new niche and expand your niche, your product, new products, whatever. What grade would you would you give us? I put myself in that position to you work with me. What grade would you give us when it comes to that? Well, I'm a pretty easy grader, so I'll come off the grade maybe. But I mean, in general, I think it's going to be like a bell curve anywhere. The challenging thing and the reason it's hard to grade or the reason that I would maybe give a curve is the landscape in which you're grading the landscape.

What these leaders are leading is the landscape is changing at all the times and so it's a it's a it's a bit of a position of the firm of how aggressive they can be. And I like to say, be brave. It's how I sign all my all my messages is how I sign off on my podcast. It's these are all things that the bravery, the aggressiveness of the bravery is probably going to depend a little bit on the positioning of the market for the firm that they're in and and the particular landscape of the industry. But you certainly start off with how many of them grasp it.

I think more and more of them are grasping it. I think we've maybe moved from a C to A, you know, a B-plus, A-minus or something. Doing something about it is still is where the question is. And I can't necessarily grade them down for not being aggressive on it or not doing more because sometimes their firms aren't ready for it.

Sometimes the marketplace is still shifting around them and their shareholders, especially the public company, their shareholders expect some return. Right now they want to see the revenue. They want to see the profit, they want to see the dividend right now where they're, let's say 80% still in the old world, but 20% in the new world. The grade is kind of maybe a delayed grade.

The question is when when leaders look at their back of themselves, I think most of them can grade themselves or be graded within the 12 month cycle within the fiscal calendar year. Pretty darn good if they're going to grade their career. The question I would have is, you know, after 15 more years, have they set those companies up for long term success? Will they be giving themselves a C minus passing? But maybe we could have been bigger or will they be giving them an A-plus? That's a lot of the times, the struggle and there's no right answer. It's just I'd like them to think about clearly that they're making the decision both in the short term and long term. And it's a decision. It's not someone is not the next guy or gals problem.

It's a decision you're making. And what I see is private held companies are oftentimes making a little bit more of the long term gain, especially if they're family owned, where it's going to be handed down to the next generation where some of the public or the private equity held, where they're trying to get a return in a unique number of years. They're they're hedging. They're telling a story about the future, but they're really trying to hedge for the return today. And that, as I said, I'm not going to grade them and it's the wrong game because I think they're actually playing two different games. So that's that's the reality. I see.

Okay. Very good. Greg, I appreciate it very much. Very insightful and always great talking to you. And for everybody. Also, thanks to again, thanks for listening to Reimagine Mobility podcast. If you like this episode, please subscribe and tell a friend.

2023-03-30 02:03

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