Liquid Behavior

Anybody who has tried to lose weight, quit smoking, or train for a marathon knows that creating a new behavior or getting rid of an old one can be very, very challenging.

But it’s not hard to pour a behavior from one container into another, and this has implications for anybody trying to launch a new product or service. Here’s an example: the Center’s Future of Transportation Project turned up a trio of numbers — 86, 80 and 60 — that tell an exciting story about how Americans’ opinions about car ownership are changing. We asked our respondents — a statistically representative snapshot of the U.S. population — if they would give up driving altogether. Eighty-six percent said they would not.

That seems definitive, but it’s not.

We changed the question and asked if Americans would give up owning a car– that is, they’d retain the ability to drive but wouldn’t own or lease a car. That 86% dropped to 80%, or to look at it from the other direction, 14% consideration rose to 20%. That’s not a big difference, and there’s still a vast supermajority of people who would not give up their cars.

But then the story changes.

Instead of looking at our entire population, we focused on the people who use what we call “get a ride services” (GARS) like Lyft, Uber, Getaround, Zipcar or Car2Go, either frequently or sometimes. Only two percent of our respondents use these services frequently, while 14% use them sometimes (84% use them rarely or never– which many find surprising given how often Uber is in the press).

Sixteen percent is a relatively small slice of the population, but the impact of GARS on people’s transportation views is profound. The 80% of people who would never give up owning a car drops to 60%. Or, to reverse the picture, the 20% consideration for no longer owning a car among the general population doubles to 40% among the GARS-using population!

With an ousted CEO, a sexist bro culture, and aggressive takeover movements from Softbank in Japan, Uber has more than its fair share of problems right now, but that’s Uber the company, Uber the noun.

Uber may not last as a company (and I’ll have more to say on this topic in a future column), but uber the verb (as in, “I’ll uber there after my lunch meeting”) isn’t going anywhere.

In other words, it takes surprisingly little to make giving up car ownership thinkable: all you have to do is try GARS sometimes and you suddenly see the hassle and expense of car ownership in a stark new light. This is bad news for car manufacturers, and particularly for the people marketing new cars, because if you look at any recent car ad the thrust of the message is “buy this car.” But the argument that the manufacturers need to be making first is “buy a car” because they can no longer take for granted that Americans know they want to own a car.

Even before we put the survey into the field, I was surprised when more than one of my suburban neighbors speculated that there might come a time when they could reduce the number of cars they have and rely on Uber (or a similar service) to fill in the gaps — this in a neighborhood where the nearest bus stop is a mile away.

Focus on Verbs, not Nouns

This isn’t a column about transportation: it’s about how little it takes to move a behavior, to pour it from one container into another like pouring orange juice from a bottle into a glass.

Previously, I’ve written about how smart phones absorbed the functions of cameras, email, notebooks, calendars, and MP3 players to become the everything-Swiss-Army-Knife devices that we can’t be without. We can extend this list to include flashlights, videogame devices, social lives, banks, zippo lighters, and more. But in this week’s column, let’s flip this phenomenon and look at it from the other direction.

What the GARS data show is the people don’t want to own things per se, they want to achieve their goals — getting around — and they’ll choose a tool — a car — to accomplish that goal, particularly if people commonly associate that tool with the goal in question. But if there’s another tool that’s easier or cheaper and achieves the same goal, then people will migrate their behavior to the new tool as soon as they understand that they have the option.

This is a big deal, because companies often focus on their product features and their competitors rather than on their customers’ needs, and that can make companies blind to new competitors that come from different angles to help customers achieve their goals faster, cheaper, or both.

This notion of liquid behavior connects to classic business thinking. In “Marketing Myopia, a famous 1960 Harvard Business Review article, Theodore Levitt wrote that companies need to ask themselves, “What business are you really in?”

Using railroads as a key example, Levitt argued that the railroads stopped growing because they presumed that they were in the railroad business rather than the transportation business. In other words, they focused on the noun (trains) rather than the verb (transportation). In Levitt’s view, transportation companies would have extended trains into trucks and airplanes, but trains weren’t going to disappear.

More recently, business professor and innovation theorist Clayton Christensen has argued (in the book Competing Against Luck) that companies need to ask their customers, “What job did you hire that product to do?” and iterate product development accordingly. This moves the Levitt question from the corporate level to the individual level. Christensen’s focus on what he calls “Job Theory” helpfully refocuses attention on the actions people want to perform rather than the tools that other people have used previously.

Liquid behavior is different from both the Levitt or Christensen questions because it presumes that today’s products and services will go away but that the actions people perform with those products and services will stick around. Only serious photographers now buy single lens reflex cameras; most people just use their phones to snap pictures. The market for typewriters is vastly smaller than it was forty years ago because most people use word processing programs on their computers to “type” things up. Travelers who want to make their own breakfast now have the option of choosing AirBNB over a traditional hotel.

For a new product or service to succeed, it’s easier to pour an old behavior into a new shape than to create something entirely new. Facebook is a terrific example of this: the service skyrocketed after it allowed its users to share photos. People had already been sharing photos since before the Polaroid, but Facebook made it easy to pour that photo sharing into a new virtual container. Early Facebookers didn’t automatically understand poking or throwing sheep (if you’re old enough, you just got hit by a wave of nostalgia), but photo-sharing was a no-brainer.

The big takeaway here is that incumbent companies are always more vulnerable than they think they are if they delude themselves into thinking that people are loyal to the brands and to the particular products that they use today to achieve their goals. Apple is vulnerable. Google is vulnerable. Facebook is vulnerable. Walmart is vulnerable. Amazon is vulnerable, and so on.

People aren’t loyal. People are busy and often don’t have the mental energy to make a change (this is different than laziness). The chance to save time and money can nudge people to give something new a try, particularly if the new thing doesn’t require a steep learning curve. That’s liquid behavior.

To survive and thrive, companies need to focus on verbs instead of nouns, on behavior instead of brands or products.

[Cross-posted at the Center for the Digital Future website.]

TechfestNW: Daimler’s Ambitious Vision for Self-Driving Trucks

I was reminded this week of a 1983 episode of the classic TV show “Knight Rider” featuring a self-driving truck named Goliath as the villain-of-the-week who battled heroes Michael Knight (played by a young David Hasselhoff) and K.I.T.T., a self-aware and self-driving Pontiac Trans Am. This boyhood memory clanged into my awareness because now, 33 years later, self-driving trucks are racing from science fiction into reality, although none of them sound like William Daniels (who provided the voice of K.I.T.T.).

At Tuesday’s TechfestNW conference in Portland Oregon — where Daimler Trucks North America (DTNA) has its headquarters — two chief engineers shared the company’s ambitious, pragmatic and exciting vision for self-driving trucks in a rare public appearance.

Steve Nadig, DTNA’s Chief Engineer of Mechatronics, and Al Pearson, DTNA’s Chief Engineer of Product Validation, told the story of how Daimler Trucks’ Global CEO Dr. Wolfgang Bernhard let them know in December of 2014 that they would have to demo a semi-autonomous truck by May of 2015 at Hoover Dam near Las Vegas. 

With the clock ticking, the two engineers went back to basics, starting with clay models and then shifting to digital models in order to rethink the truck both inside and out.

Nadig and Peason’s team faced more than just engineering challenges: they also had to work with the state government of Nevada to have the truck accumulate 10,000 miles of incident-free driving before it could be licensed. 

148 days later, they hit their mark with the Inspiration Truck, a Class 2 semi-autonomous semi-truck (perhaps they should have called it the Semi-Semi?) that answers DTNA’s key questions, “What’s next?” And “How will we drive tomorrow?” in tons of metal instead of mere words.  

(Note: a fully autonomous vehicle is Class 5, and a vehicle with no automatic driving capabilities whatsoever is Class 2.)

Humans still behind the wheel, but only paying attention sometimes…

Unlike other vehicle companies that imagine a time when human freight drivers will no longer exist — or perhaps a time when humans are not allowed to drive at all — Pearson doesn’t think that an era with zero human truck drivers will arrive anytime soon.

“Total autonomous is possible now,” Person said. “But only if the environment is controlled. We think it’s going to be a while before we can ensure safety in all conditions.”

With a human driver still in the Daimler truck, that driver’s role will evolve, piloting the truck in the too-complex-for-AI terrain of cities, and then letting the truck drive itself on the highways.

Freed from highway driving, the human driver will manage logistics from the road, pushing that role out from a central or regional office to the edges of the shipping company’s footprint.  (More on this later.)

Why develop the Inspiration Truck?

Pearson and Nadig shared a cluster of compelling reasons for self-driving trucks: as the economy grows and becomes evermore global, freight will only continue to be grow alongside it, and self-driving trucks increase freight capacity. 

With “platooning” — where one self-driving truck follows another on the highway at a distance of 15 meters or less — the first truck cuts through the wind and gives an aerodynamic benefit to each of the trucks that follow it. 

15 meters is too close for a human driver to follow, but with V2V (vehicle to vehicle communications) the self-driving trucks take slower human reaction time out of the equation.

In addition, freight companies would benefit from trucks like the Inspiration because of increased safety features, reduced fuel consumption, reduced vehicle component strain, reduced maintenance and repair, predictive route driving, reduced driver stress, optimized driver time and more generally an improved reputation for the company in question.

Daimler’s approach

Since the Inspiration truck is not striving to eliminate human drivers, Daimler’s approach to self-driving is, in Nadig’s words, “a relatively simple combination of technologies,” that includes an internal camera, two cameras in each mirror (one looking at the blind spot and back down the trailer, a “big safety improvement”), and a radar sensor focused out in front of the truck. 

As Nadig observed, using this technology “reduces drivers’ stress and gets them to an optimum level,” but this is only for highway driving: “there are still lots of skills being used on city streets.”

Daimler’s lean approach requires less up-front computation than what other self-driving experiments (like Google, Uber, Toyota, Nvidia) are finding they need, although particularly with V2V and platooning there is still a formidable amount going on under the digital hood of the Inspiration.

As the session shifted into audience Q&A, Nadig observed that “there’s a social aspect” to autonomous vehicles as well as a technological one. “Think about getting on an airplane without a pilot: the technology will go faster than society is prepared to react to it,” Nadig said.

Implications: Daimler’s approach to self-driving trucks is evolutionary rather than revolutionary, which I intend as a compliment. DTNA’s focus is on making its current customers happier and happier by improving the most expensive tool their customers buy and maintain: trucks.

I’m most intrigued by how the Inspiration reimagines — and reengineers — the role of the human driver into half driver and half logistics manager: it’s a rare moment in autonomous vehicle thinking that thinks of humans as a resource worth investing in rather than as a disposable cost center.

One possible outcome to this shift is that drivers also become knowledge workers, higher skilled, higher paid, managing deliveries, inventories and other things at the edge of a freight company’s geographic footprint rather than having things managed mostly in the home office. This could make the freight company more responsive and agile in how it approaches its business.

Moreover, with excess human capacity in the Inspiration, in what other activities could a freight company — or DTNA itself — invest?

Recall that Amazon Web Services (currently the fastest-growing part of Amazon’s business) started as an answer to the question of what to do with the company’s excess web server capacity, and an opportunity for DTNA to do something similar with its own excess capacity in transport and logistics quickly comes into focus (Thomas Friedman discussed UPS doing something similar in his 2005 book The World is Flat, and I’d be eager to see how the larger carrying capacity of DTNA trucks grew that opportunity.)

DTNA’s level 2 approach to self-driving trucks also shows that while the world in which humans no longer drive except for pleasure is still a long way off, we’ll start sharing the roads with non-human drivers in the very immediate future— and not just near Google’s Mountain View campus.

But can I get my car to talk to me in William Daniels’ voice, like K.I.T.T.?

[Cross-posted at LinkedIn.]