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Self-driving and electric cars just don’t stop making headlines lately. Amazon invested in self-driving startup Aurora earlier this year. Waymo, Daimler, GM, along with startups like Zoox, have all launched or are planning to launch driverless taxis, many of them all-electric. People are even yanking driverless cars from their timeless natural habitat—roads—to try to teach them to navigate forests and deserts.
The future of driving, it would appear, is upon us.
But an equally important vehicle that often gets left out of the conversation is trucks; their relevance to our day-to-day lives may not be as visible as that of cars, but their impact is more profound than most of us realize.
Two recent developments in trucking point to a future of self-driving, electric semis hauling goods across the country, and likely doing so more quickly, cheaply, and safely than trucks do today.
Self-Driving in Texas
Last week, Kodiak Robotics announced it’s beginning its first commercial deliveries using self-driving trucks on a route from Dallas to Houston. The two cities sit about 240 miles apart, connected primarily by interstate 45. Kodiak is aiming to expand its reach far beyond the heart of Texas (if Dallas and Houston can be considered the heart, that is) to the state’s most far-flung cities, including El Paso to the west and Laredo to the south.
If self-driving trucks are going to be constrained to staying within state lines (and given that the laws regulating them differ by state, they will be for the foreseeable future), Texas is a pretty ideal option. It’s huge (thousands of miles of highway run both east-west and north-south), it’s warm (better than cold for driverless tech components like sensors), its proximity to Mexico means constant movement of both raw materials and manufactured goods (basically, you can’t have too many trucks in Texas), and most crucially, it’s lax on laws (driverless vehicles have been permitted there since 2017).
Spoiler, though—the trucks won’t be fully unmanned. They’ll have safety drivers to guide them onto and off of the highway, and to be there in case of any unexpected glitches.
California Goes (Even More) Electric
According to some top executives in the rideshare industry, automation is just one key component of the future of driving. Another is electricity replacing gas, and it’s not just carmakers that are plugging into the trend.
This week, Daimler Trucks North America announced completion of its first electric semis for customers Penske and NFI, to be used in the companies’ southern California operations. Scheduled to start operating later this month, the trucks will essentially be guinea pigs for testing integration of electric trucks into large-scale fleets; intel gleaned from the trucks’ performance will impact the design of later models.
Design-wise, the trucks aren’t much different from any other semi you’ve seen lumbering down the highway recently. Their range is about 250 miles—not bad if you think about how much more weight a semi is pulling than a passenger sedan—and they’ve been dubbed eCascadia, an electrified version of Freightliner’s heavy-duty Cascadia truck.
Batteries have a long way to go before they can store enough energy to make electric trucks truly viable (not to mention setting up a national charging infrastructure), but Daimler’s announcement is an important step towards an electrically-driven future.
Keep on Truckin’
Obviously, it’s more exciting to think about hailing one of those cute little Waymo cars with no steering wheel to shuttle you across town than it is to think about that 12-pack of toilet paper you ordered on Amazon cruising down the highway in a semi while the safety driver takes a snooze. But pushing driverless and electric tech in the trucking industry makes sense for a few big reasons.
Trucks mostly run long routes on interstate highways—with no pedestrians, stoplights, or other city-street obstacles to contend with, highway driving is much easier to automate. What glitches there are to be smoothed out may as well be smoothed out with cargo on board rather than people. And though you wouldn’t know it amid the frantic shouts of ‘a robot could take your job!’, the US is actually in the midst of a massive shortage of truck drivers—60,000 short as of earlier this year, to be exact.
As Todd Spencer, president of the Owner-Operator Independent Drivers Association, put it, “Trucking is an absolutely essential, critical industry to the nation, to everybody in it.” Alas, trucks get far less love than cars, but come on—probably 90 percent of the things you ate, bought, or used today were at some point moved by a truck.
Adding driverless and electric tech into that equation, then, should yield positive outcomes on all sides, whether we’re talking about cheaper 12-packs of toilet paper, fewer traffic fatalities due to human error, a less-strained labor force, a stronger economy… or something pretty cool to see as you cruise down the highway in your (driverless, electric, futuristic) car.
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The US is at war. That’s probably not exactly news, as the country has been engaged in one type of conflict or another for most of its history. The last time we officially declared war was after Japan bombed Pearl Harbor in December 1941.
Our biggest undeclared war today is not being fought by drones in the mountains of Afghanistan or even through the less-lethal barrage of threats over the nuclear programs in North Korea and Iran. In this particular war, it is the US that is under attack and on the defensive.
This is cyberwarfare.
The definition of what constitutes a cyber attack is a broad one, according to Greg White, executive director of the Center for Infrastructure Assurance and Security (CIAS) at The University of Texas at San Antonio (UTSA).
At the level of nation-state attacks, cyberwarfare could involve “attacking systems during peacetime—such as our power grid or election systems—or it could be during war time in which case the attacks may be designed to cause destruction, damage, deception, or death,” he told Singularity Hub.
For the US, the Pearl Harbor of cyberwarfare occurred during 2016 with the Russian interference in the presidential election. However, according to White, an Air Force veteran who has been involved in computer and network security since 1986, the history of cyber war can be traced back much further, to at least the first Gulf War of the early 1990s.
“We started experimenting with cyber attacks during the first Gulf War, so this has been going on a long time,” he said. “Espionage was the prime reason before that. After the war, the possibility of expanding the types of targets utilized expanded somewhat. What is really interesting is the use of social media and things like websites for [psychological operation] purposes during a conflict.”
The 2008 conflict between Russia and the Republic of Georgia is often cited as a cyberwarfare case study due to the large scale and overt nature of the cyber attacks. Russian hackers managed to bring down more than 50 news, government, and financial websites through denial-of-service attacks. In addition, about 35 percent of Georgia’s internet networks suffered decreased functionality during the attacks, coinciding with the Russian invasion of South Ossetia.
The cyberwar also offers lessons for today on Russia’s approach to cyberspace as a tool for “holistic psychological manipulation and information warfare,” according to a 2018 report called Understanding Cyberwarfare from the Modern War Institute at West Point.
US Fights Back
News in recent years has highlighted how Russian hackers have attacked various US government entities and critical infrastructure such as energy and manufacturing. In particular, a shadowy group known as Unit 26165 within the country’s military intelligence directorate is believed to be behind the 2016 US election interference campaign.
However, the US hasn’t been standing idly by. Since at least 2012, the US has put reconnaissance probes into the control systems of the Russian electric grid, The New York Times reported. More recently, we learned that the US military has gone on the offensive, putting “crippling malware” inside the Russian power grid as the U.S. Cyber Command flexes its online muscles thanks to new authority granted to it last year.
“Access to the power grid that is obtained now could be used to shut something important down in the future when we are in a war,” White noted. “Espionage is part of the whole program. It is important to remember that cyber has just provided a new domain in which to conduct the types of activities we have been doing in the real world for years.”
The US is also beginning to pour more money into cybersecurity. The 2020 fiscal budget calls for spending $17.4 billion throughout the government on cyber-related activities, with the Department of Defense (DoD) alone earmarked for $9.6 billion.
Despite the growing emphasis on cybersecurity in the US and around the world, the demand for skilled security professionals is well outpacing the supply, with a projected shortfall of nearly three million open or unfilled positions according to the non-profit IT security organization (ISC)².
UTSA is rare among US educational institutions in that security courses and research are being conducted across three different colleges, according to White. About 10 percent of the school’s 30,000-plus students are enrolled in a cyber-related program, he added, and UTSA is one of only 21 schools that has received the Cyber Operations Center of Excellence designation from the National Security Agency.
“This track in the computer science program is specifically designed to prepare students for the type of jobs they might be involved in if they went to work for the DoD,” White said.
However, White is extremely doubtful there will ever be enough cyber security professionals to meet demand. “I’ve been preaching that we’ve got to worry about cybersecurity in the workforce, not just the cybersecurity workforce, not just cybersecurity professionals. Everybody has a responsibility for cybersecurity.”
Artificial Intelligence in Cybersecurity
Indeed, humans are often seen as the weak link in cybersecurity. That point was driven home at a cybersecurity roundtable discussion during this year’s Brainstorm Tech conference in Aspen, Colorado.
Participant Dorian Daley, general counsel at Oracle, said insider threats are at the top of the list when it comes to cybersecurity. “Sadly, I think some of the biggest challenges are people, and I mean that in a number of ways. A lot of the breaches really come from insiders. So the more that you can automate things and you can eliminate human malicious conduct, the better.”
White noted that automation is already the norm in cybersecurity. “Humans can’t react as fast as systems can launch attacks, so we need to rely on automated defenses as well,” he said. “This doesn’t mean that humans are not in the loop, but much of what is done these days is ‘scripted’.”
The use of artificial intelligence, machine learning, and other advanced automation techniques have been part of the cybersecurity conversation for quite some time, according to White, such as pattern analysis to look for specific behaviors that might indicate an attack is underway.
“What we are seeing quite a bit of today falls under the heading of big data and data analytics,” he explained.
But there are signs that AI is going off-script when it comes to cyber attacks. In the hands of threat groups, AI applications could lead to an increase in the number of cyberattacks, wrote Michelle Cantos, a strategic intelligence analyst at cybersecurity firm FireEye.
“Current AI technology used by businesses to analyze consumer behavior and find new customer bases can be appropriated to help attackers find better targets,” she said. “Adversaries can use AI to analyze datasets and generate recommendations for high-value targets they think the adversary should hit.”
In fact, security researchers have already demonstrated how a machine learning system could be used for malicious purposes. The Social Network Automated Phishing with Reconnaissance system, or SNAP_R, generated more than four times as many spear-phishing tweets on Twitter than a human—and was just as successful at targeting victims in order to steal sensitive information.
Cyber war is upon us. And like the current war on terrorism, there are many battlefields from which the enemy can attack and then disappear. While total victory is highly unlikely in the traditional sense, innovations through AI and other technologies can help keep the lights on against the next cyber attack.
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DeepMind Can Now Beat Us at Multiplayer Games Too
Cade Metz | The New York Times
“DeepMind’s project is part of a broad effort to build artificial intelligence that can play enormously complex, three-dimensional video games, including Quake III, Dota 2 and StarCraft II. Many researchers believe that success in the virtual arena will eventually lead to automated systems with improved abilities in the real world.”
Tiny Robots Carry Stem Cells Through a Mouse
Emily Waltz | IEEE Spectrum
“Engineers have built microrobots to perform all sorts of tasks in the body, and can now add to that list another key skill: delivering stem cells. In a paper, published [May 29] in Science Robotics, researchers describe propelling a magnetically-controlled, stem-cell-carrying bot through a live mouse.” [Video shows microbots navigating a microfluidic chip. MRI could not be used to image the mouse as the bots navigate magnetically.]
How a Quantum Computer Could Break 2048-Bit RSA Encryption in 8 Hours
Emerging Technology From the arXiv | MIT Technology Review
“[Two researchers] have found a more efficient way for quantum computers to perform the code-breaking calculations, reducing the resources they require by orders of magnitude. Consequently, these machines are significantly closer to reality than anyone suspected.” [The arXiv is a pre-print server for research that has not yet been peer reviewed.]
Lyft Has Completed 55,000 Self Driving Rides in Las Vegas
Christine Fisher | Engadget
“One year ago, Lyft launched its self-driving ride service in Las Vegas. Today, the company announced its 30-vehicle fleet has made 55,000 trips. That makes it the largest commercial program of its kind in the US.”
Flying Car Startup Alaka’i Bets Hydrogen Can Outdo Batteries
Eric Adams | Wired
“Alaka’i says the final product will be able to fly for up to four hours and cover 400 miles on a single load of fuel, which can be replenished in 10 minutes at a hydrogen fueling station. It has built a functional, full-scale prototype that will make its first flight ‘imminently,’ a spokesperson says.”
The World Economic Forum Wants to Develop Global Rules for AI
Will Knight | MIT Technology Review
“This week, AI experts, politicians, and CEOs will gather to ask an important question: Can the United States, China, or anyone else agree on how artificial intelligence should be used and controlled?”
Building a Rocket in a Garage to Take on SpaceX and Blue Origin
Jackson Ryan | CNET
“While billionaire entrepreneurs like SpaceX’s Elon Musk and Blue Origin’s Jeff Bezos push the boundaries of human spaceflight and exploration, a legion of smaller private startups around the world have been developing their own rocket technology to launch lighter payloads into orbit.”
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In the wake of the housing market collapse of 2008, one entrepreneur decided to dive right into the failing real estate industry. But this time, he didn’t buy any real estate to begin with. Instead, Glenn Sanford decided to launch the first-ever cloud-based real estate brokerage, eXp Realty.
Contracting virtual platform VirBELA to build out the company’s mega-campus in VR, eXp Realty demonstrates the power of a dematerialized workspace, throwing out hefty overhead costs and fundamentally redefining what ‘real estate’ really means. Ten years later, eXp Realty has an army of 14,000 agents across all 50 US states, 3 Canadian provinces, and 400 MLS market areas… all without a single physical office.
But VR is just one of many exponential technologies converging to revolutionize real estate and construction. As floating cities and driverless cars spread out your living options, AI and VR are together cutting out the middleman.
Already, the global construction industry is projected to surpass $12.9 trillion in 2022, and the total value of the US housing market alone grew to $33.3 trillion last year. Both vital for our daily lives, these industries will continue to explode in value, posing countless possibilities for disruption.
In this blog, I’ll be discussing the following trends:
New prime real estate locations;
Disintermediation of the real estate broker and search;
Materials science and 3D printing in construction.
Let’s dive in!
Location Location Location
Until today, location has been the name of the game when it comes to hunting down the best real estate. But constraints on land often drive up costs while limiting options, and urbanization is only exacerbating the problem.
Beyond the world of virtual real estate, two primary mechanisms are driving the creation of new locations.
(1) Floating Cities
Offshore habitation hubs, floating cities have long been conceived as a solution to rising sea levels, skyrocketing urban populations, and threatened ecosystems. In success, they will soon unlock an abundance of prime real estate, whether for scenic living, commerce, education, or recreation.
One pioneering model is that of Oceanix City, designed by Danish architect Bjarke Ingels and a host of other domain experts. Intended to adapt organically over time, Oceanix would consist of a galaxy of mass-produced, hexagonal floating modules, built as satellite “cities” off coastal urban centers and sustained by renewable energies.
While individual 4.5-acre platforms would each sustain 300 people, these hexagonal modules are designed to link into 75-acre tessellations sustaining up to 10,000 residents. Each anchored to the ocean floor using biorock, Oceanix cities are slated to be closed-loop systems, as external resources are continuously supplied by automated drone networks.
Electric boats or flying cars might zoom you to work, city-embedded water capture technologies would provide your water, and while vertical and outdoor farming supply your family meal, share economies would dominate goods provision.
AERIAL: Located in calm, sheltered waters, near coastal megacities, OCEANIX City will be an adaptable, sustainable, scalable, and affordable solution for human life on the ocean. Image Credit: OCEANIX/BIG-Bjarke Ingels Group.
Joined by countless government officials whose islands risk submersion at the hands of sea level rise, the UN is now getting on board. And just this year, seasteading is exiting the realm of science fiction and testing practical waters.
As French Polynesia seeks out robust solutions to sea level rise, their government has now joined forces with the San Francisco-based Seasteading Institute. With a newly designated special economic zone and 100 acres of beachfront, this joint Floating Island Project could even see up to a dozen inhabitable structures by 2020. And what better to fund the $60 million project than the team’s upcoming ICO?
But aside from creating new locations, autonomous vehicles (AVs) and flying cars are turning previously low-demand land into the prime real estate of tomorrow.
(2) Autonomous Electric Vehicles and Flying Cars
Today, the value of a location is a function of its proximity to your workplace, your city’s central business district, the best schools, or your closest friends.
But what happens when driverless cars desensitize you to distance, or Hyperloop and flying cars decimate your commute time? Historically, every time new transit methods have hit the mainstream, tolerance for distance has opened up right alongside them, further catalyzing city spread.
And just as Hyperloop and the Boring Company aim to make your commute immaterial, autonomous vehicle (AV) ridesharing services will spread out cities in two ways: (1) by drastically reducing parking spaces needed (vertical parking decks = more prime real estate); and (2) by untethering you from the steering wheel. Want an extra two hours of sleep on the way to work? Schedule a sleeper AV and nap on your route to the office. Need a car-turned-mobile-office? No problem.
Meanwhile, aerial taxis (i.e. flying cars) will allow you to escape ground congestion entirely, delivering you from bedroom to boardroom at decimated time scales.
Already working with regulators, Uber Elevate has staked ambitious plans for its UberAIR airborne taxi project. By 2023, Uber anticipates rolling out flying drones in its two first pilot cities, Los Angeles and Dallas. Flying between rooftop skyports, drones would carry passengers at a height of 1,000 to 2,000 feet at speeds between 100 to 200 mph. And while costs per ride are anticipated to resemble those of an Uber Black based on mileage, prices are projected to soon drop to those of an UberX.
But the true economic feat boils down to this: if I were to commute 50 to 100 kilometers, I could get two or three times the house for the same price. (Not to mention the extra living space offered up by my now-unneeded garage.)
All of a sudden, virtual reality, broadband, AVs, or high-speed vehicles are going to change where we live and where we work. So rather than living in a crowded, dense urban core for access to jobs and entertainment, our future of personalized, autonomous, low-cost transport opens the luxury of rural areas to all without compromising the benefits of a short commute.
Once these drivers multiply your real estate options, how will you select your next home?
Disintermediation: Say Bye to Your Broker
In a future of continuous and personalized preference-tracking, why hire a human agent who knows less about your needs and desires than a personal AI?
Just as disintermediation is cutting out bankers and insurance agents, so too is it closing in on real estate brokers. Over the next decade, as AI becomes your agent, VR will serve as your medium.
To paint a more vivid picture of how this will look, over 98 percent of your home search will be conducted from the comfort of your couch through next-generation VR headgear.
Once you’ve verbalized your primary desires for home location, finishings, size, etc. to your personal AI, it will offer you top picks, tour-able 24/7, with optional assistance by a virtual guide and constantly updated data. As a seller, this means potential buyers from two miles, or two continents, away.
Throughout each immersive VR tour, advanced eye-tracking software and a permissioned machine learning algorithm follow your gaze, further learn your likes and dislikes, and intelligently recommend other homes or commercial residences to visit.
Curious as to what the living room might look like with a fresh coat of blue paint and a white carpet? No problem! VR programs will be able to modify rendered environments instantly, changing countless variables, from furniture materials to even the sun’s orientation. Keen to input your own furniture into a VR-rendered home? Advanced AIs could one day compile all your existing furniture, electronics, clothing, decorations, and even books, virtually organizing them across any accommodating new space.
As 3D scanning technologies make extraordinary headway, VR renditions will only grow cheaper and higher resolution. One company called Immersive Media (disclosure: I’m an investor and advisor) has a platform for 360-degree video capture and distribution, and is already exploring real estate 360-degree video.
Smaller firms like Studio 216, Vieweet, Arch Virtual, ArX Solutions, and Rubicon Media can similarly capture and render models of various properties for clients and investors to view and explore. In essence, VR real estate platforms will allow you to explore any home for sale, do the remodel, and determine if it truly is the house of your dreams.
Once you’re ready to make a bid, your AI will even help estimate a bid, process and submit your offer. Real estate companies like Zillow, Trulia, Move, Redfin, ZipRealty (acquired by Realogy in 2014) and many others have already invested millions in machine learning applications to make search, valuation, consulting, and property management easier, faster, and much more accurate.
But what happens if the home you desire most means starting from scratch with new construction?
New Methods and Materials for Construction
For thousands of years, we’ve been constrained by the construction materials of nature. We built bricks from naturally abundant clay and shale, used tree limbs as our rooftops and beams, and mastered incredible structures in ancient Rome with the use of cement.
But construction is now on the cusp of a materials science revolution. Today, I’d like to focus on three key materials:
Imagine if you could turn the world’s greatest waste products into their most essential building blocks. Thanks to UCLA researchers at CO2NCRETE, we can already do this with carbon emissions.
Today, concrete produces about five percent of all greenhouse gas (GHG) emissions. But what if concrete could instead conserve greenhouse emissions? CO2NCRETE engineers capture carbon from smokestacks and combine it with lime to create a new type of cement. The lab’s 3D printers then shape the upcycled concrete to build entirely new structures. Once conquered at scale, upcycled concrete will turn a former polluter into a future conserver.
Or what if we wanted to print new residences from local soil at hand? Marking an extraordinary convergence between robotics and 3D printing, the Institute of Advanced Architecture of Catalonia (IAAC) is already working on a solution.
In a major feat for low-cost construction in remote zones, IAAC has found a way to convert almost any soil into a building material with three times the tensile strength of industrial clay. Offering myriad benefits, including natural insulation, low GHG emissions, fire protection, air circulation, and thermal mediation, IAAC’s new 3D printed native soil can build houses on-site for as little as $1,000.
Nano- and micro-materials are ushering in a new era of smart, super-strong, and self-charging buildings. While carbon nanotubes dramatically increase the strength-to-weight ratio of skyscrapers, revolutionizing their structural flexibility, nanomaterials don’t stop here.
Several research teams are pioneering silicon nanoparticles to capture everyday light flowing through our windows. Little solar cells at the edges of windows then harvest this energy for ready use. Researchers at the US National Renewable Energy Lab have developed similar smart windows. Turning into solar panels when bathed in sunlight, these thermochromic windows will power our buildings, changing color as they do.
The American Society of Civil Engineers estimates that the US needs to spend roughly $4.5 trillion to fix nationwide roads, bridges, dams, and common infrastructure by 2025. But what if infrastructure could fix itself?
Enter self-healing concrete. Engineers at Delft University have developed bio-concrete that can repair its own cracks. As head researcher Henk Jonkers explains, “What makes this limestone-producing bacteria so special is that they are able to survive in concrete for more than 200 years and come into play when the concrete is damaged. […] If cracks appear as a result of pressure on the concrete, the concrete will heal these cracks itself.”
But bio-concrete is only the beginning of self-healing technologies. As futurist architecture firms start printing plastic and carbon-fiber houses like the stunner seen below (using Branch Technologies’ 3D printing technology), engineers have begun tackling self-healing plastic.
And in a bid to go smart, burgeoning construction projects have started embedding sensors for preemptive detection. Beyond materials and sensors, however, construction methods are fast colliding into robotics and 3D printing.
While some startups and research institutes have leveraged robot swarm construction (namely, Harvard’s robotic termite-like swarm of programmed constructors), others have taken to large-scale autonomous robots.
One such example involves Fastbrick Robotics. After multiple iterations, the company’s Hadrian X end-to-end bricklaying robot can now autonomously build a fully livable, 180-square meter home in under 3 days. Using a laser-guided robotic attachment, the all-in-one brick-loaded truck simply drives to a construction site and directs blocks through its robotic arm in accordance with a 3D model.
Layhead. Image Credit: Fastbrick Robotics.
Meeting verified building standards, Hadrian and similar solutions hold massive promise in the long term, deployable across post-conflict refugee sites and regions recovering from natural catastrophes.
Imagine the implications. Eliminating human safety concerns and unlocking any environment, autonomous builder robots could collaboratively build massive structures in space or deep underwater habitats.
Where, how, and what we live in form a vital pillar of our everyday lives. The concept of “home” is unlikely to disappear anytime soon. At the same time, real estate and construction are two of the biggest playgrounds for technological convergence, each on the verge of revolutionary disruption.
As underlying shifts in transportation, land reclamation, and the definition of “space” (real vs. virtual) take hold, the real estate market is about to explode in value, spreading out urban centers on unprecedented scales and unlocking vast new prime “property.”
Meanwhile, converging advancements in AI and VR are fundamentally disrupting the way we design, build, and explore new residences. Just as mirror worlds create immersive, virtual real estate economies, VR tours and AI agents are absorbing both sides of the coin to entirely obliterate the middleman.
And as materials science breakthroughs meet new modes of construction, the only limits to tomorrow’s structures are those of our own imagination.
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We live in the age of entrepreneurs. New startups seem to appear out of nowhere and challenge not only established companies, but entire industries. Where startup unicorns were once mythical creatures, they now seem abundant, not only increasing in numbers but also in the speed with which they can gain the minimum one-billion-dollar valuations to achieve this status.
But no matter how well things go for innovative startups, how many new success stories we hear, and how much space they take up in the media, the story that they are the best or only source of innovation isn’t entirely accurate.
Established organizations, or legacy organizations, can be incredibly innovative too. And while innovation is much more difficult in established organizations than in startups because they have much more complex systems—nobody is more likely to succeed in their innovation efforts than established organizations.
Unlike startups, established organizations have all the resources. They have money, customers, data, suppliers, partners, and infrastructure, which put them in a far better position to transform new ideas into concrete, value-creating, successful offerings than startups.
However, for established organizations, becoming an innovation champion in these times of rapid change requires new rules of engagement.
Many organizations commit the mistake of engaging in innovation as if it were a homogeneous thing that should be approached in the same way every time, regardless of its purpose. In my book, Transforming Legacy Organizations, I argue that innovation in established organizations must actually be divided into three different tracks: optimizing, augmenting, and mutating innovation.
All three are important, and to complicate matters further, organizations must execute all three types of innovation at the same time.
The first track is optimizing innovation. This type of innovation is the majority of what legacy organizations already do today. It is, metaphorically speaking, the extra blade on the razor. A razor manufacturer might launch a new razor that has not just three, but four blades, to ensure an even better, closer, and more comfortable shave. Then one or two years later, they say they are now launching a razor that has not only four, but five blades for an even better, closer, and more comfortable shave. That is optimizing innovation.
Adding extra blades on the razor is where the established player reigns.
No startup with so much as a modicum of sense would even try to beat the established company in this type of innovation. And this continuous optimization, both on the operational and customer facing sides, is important. In the short term. It pays the rent. But it’s far from enough. There are limits to how many blades a razor needs, and optimizing innovation only improves upon the past.
Established players must also go beyond optimization and prepare for the future through augmenting innovation.
The digital transformation projects that many organizations are initiating can be characterized as augmenting innovation. In the first instance, it is about upgrading core offerings and processes from analog to digital. Or, if you’re born digital, you’ve probably had to augment the core to become mobile-first. Perhaps you have even entered the next augmentation phase, which involves implementing artificial intelligence. Becoming AI-first, like the Amazons, Microsofts, Baidus, and Googles of the world, requires great technological advancements. And it’s difficult. But technology may, in fact, be a minor part of the task.
The biggest challenge for augmenting innovation is probably culture.
Only legacy organizations that manage to transform their cultures from status quo cultures—cultures with a preference for things as they are—into cultures full of incremental innovators can thrive in constant change.
To create a strong innovation culture, an organization needs to thoroughly understand its immune systems. These are the mechanisms that protect the organization and operate around the clock to keep it healthy and stable, just as the body’s immune system operates to keep the body healthy and stable. But in a rapidly changing world, many of these defense mechanisms are no longer appropriate and risk weakening organizations’ innovation power.
When talking about organizational immune systems, there is a clear tendency to simply point to the individual immune system, people’s unwillingness to change.
But this is too simplistic.
Of course, there is human resistance to change, but the organizational immune system, consisting of a company’s key performance indicators (KPIs), rewards systems, legacy IT infrastructure and processes, and investor and shareholder demands, is far more important. So is the organization’s societal immune system, such as legislative barriers, legacy customers and providers, and economic climate.
Luckily, there are many culture hacks that organizations can apply to strengthen their innovation cultures by upgrading their physical and digital workspaces, transforming their top-down work processes into decentralized, agile ones, and empowering their employees.
Upgrading your core and preparing for the future by augmenting innovation is crucial if you want success in the medium term. But to win in the long run and be as or more successful 20 to 30 years from now, you need to invent the future, and challenge your core, through mutating innovation.
This requires involving radical innovators who have a bold focus on experimenting with that which is not currently understood and for which a business case cannot be prepared.
Here you must also physically move away from the core organization when you initiate and run such initiatives. This is sometimes called “innovation on the edges” because the initiatives will not have a chance at succeeding within the core. It will be too noisy as they challenge what currently exists—precisely what the majority of the organization’s employees are working to optimize or augment.
Forward-looking organizations experiment to mutate their core through “X divisions,” sometimes called skunk works or innovation labs.
Lowe’s Innovation Labs, for instance, worked with startups to build in-store robot assistants and zero-gravity 3D printers to explore the future. Mutating innovation might include pursuing partnerships across all imaginable domains or establishing brand new companies, rather than traditional business units, as we see automakers such as Toyota now doing to build software for autonomous vehicles. Companies might also engage in radical open innovation by sponsoring others’ ingenuity. Japan’s top airline ANA is exploring a future of travel that does not involve flying people from point A to point B via the ANA Avatar XPRIZE competition.
Increasing technological opportunities challenge the core of any organization but also create unprecedented potential. No matter what product, service, or experience you create, you can’t rest on your laurels. You have to bring yourself to a position where you have a clear strategy for optimizing, augmenting, and mutating your core and thus transforming your organization.
It’s not an easy job. But, hey, if it were easy, everyone would be doing it. Those who make it, on the other hand, will be the innovation champions of the future.
Image Credit: rock-the-stock / Shutterstock.com
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