Electric Vehicles — a disruptive technology?
September , 2009
I finally read The Innovator’s Dilemma, by Clayton Christensen, which originally came out in 1997 (with a revised edition in 2000). See my review. I clearly should have read it a long time ago.
When reading it, I kept thinking how much it explains so many things about the GM EV1 project. It explains how the crack EV1 marketing team still had trouble defining a market (Christensen’s Principle #3: Markets that Don’t Exist Can’t be Analyzed). It explains why Tesla, which has sold something like 700 vehicles, is considered a success, while the GM EV1, which put out a lot more, is considered a failure (Principle #2: Small Markets Don’t Solve the Growth Needs of Large Companies).
It even explains how a big company like GM might have been able to do more with a disruptive technology. It’s in Chapter Six — Match the Size of the Organization to the Size of the Market.
It makes me wonder. What if GM had spun off the EV into its own small company, and put that company into its own markets, its own value network, and most of all, its own culture. I had noticed right away, in moving from California to Michigan in 1991 how much the culture was different. But they wouldn’t have had to move the project all the way to California. Nope, Ann Arbor, which physically is practically next door, is culturally way different. I think spinning it off, even if kept as a fully owned subsidiary, and moving it to Ann Arbor, would have resulted in a far different organization, one that could get excited about small markets, and could grow and nurture the small markets.
The EV1 that actually was built was a great car. The small market that loved it, really, really loved it. But imagine if it had been allowed to mature, to improve every couple of years with a new version. Imagine where we would be today!
Then again, hindsight is 20/20 as they say. A lot of very smart people tried very hard, but the innovator’s dilemma got them. Let’s try and stay awake and not let it get us the next time.