If you think technology is causing major, and rapid changes among U.S. industries — including trucking — you haven’t seen anything yet.
That’s one of the key messages from a parallel review of two new major studies: the “Future of Growth and Industry Report” from Grant Thornton, a well-regarded Chicago-based global audit, tax and strategic advisory firm, and a recently updated survey from technology consulting firm Princeton Consultants called “Digital Disruption in Freight Transportation.”
Leading companies are comfortable with risk
Grant Thornton’s report examines the relative success and failures of companies that, to date, have been among either “leaders” in making “bold decisions” to reinvent themselves vs. those companies who, as “followers,” have been more resistant to making such changes or adaptations. And nearly eight out of 10 (79 percent) of companies that fit the description of “leader” consistently make developing new services or products that allow them to move into a new sector of work a priority, while only 49 percent of “follower” companies make finding ways to compete in new sectors or new ways a priority.
Similarly, leader companies aggressively seek to balance out the risk of making such changes against the business opportunities they want to pursue, while just 42 percent of follower companies take the same approach. In short, leader companies are far more likely to accept somewhat greater risk in order to grow their business than more cautious follower companies.
Trucking leaders expect technology disruption to increase
Meanwhile, Princeton Consultants’ updated survey shows that a fast-growing number of trucking industry leaders now expect the pace and kind of disruption in their industry to intensify. Already the industry is being pushed to rapidly adopt Internet of Things (IoT) and Big Data concepts by equipping its trucks with sophisticated monitoring technologies to monitor truck and driver performances, provide increased safety margins and lower liability coverage costs, and to protect valuable equipment and freight from would-be hijackers and thieves.
The survey showed that 84 percent of respondents believe IoT-related technologies will have a large or moderate impact on the trucking industry in the years ahead. And 85 percent believe that Big Data – the collection and proper analysis of hundreds or thousands of streams of data in real or near-real time – will have a big or moderate impact on the industry’s and individual trucking companies’ futures.
Indeed, much more is on the way in terms of ever-more sophisticated technology tracking systems and data analysis capabilities.
Self-driving trucks will come online in phases
The biggest trend, which admittedly will likely play out over 20 years or, will be a transition to self-driving trucks. These trucks won’t entirely replace the kind driven today by real people but will add lower-cost capacity in certain segments where driverless systems can produce significant efficiencies.
The first move in that direction, according to Princeton Consultants, will be the normalization of truck autopilot systems. Though only one actual controlled test of a system has been completed so far, lots of testing and development work is underway. As a result, such system should be common in the next few years.
Next, according to Princeton Consultants, will be the move to actual driverless trucks operating on line-haul routes on major highways, perhaps in pelotons with a lead truck that may or may not have a human in the driver’s seat.
Door-to-door driverless operations will be slower to come online, and that won’t happen until the public – and highway safety officials and law makers get more comfortable with the safety performance results of driverless automobiles, which are only now in the very early testing stages.
More people expecting self-driving trucks to be disruptive
Last year the Princeton survey found only 28 percent of respondents expected that self-driving trucks would have a moderate or large impact on the trucking industry. This year, however, that figure rose to 40 percent.
The challenge for trucking company decision makers will be in determining both what technologies to invest in to gain the best economic returns and how to synchronize their technology investments to work well within a business environment that will be changing just as fast. The Grant Thornton study suggests that business disruptions like what could be caused if Uber’s plan to bring its on-demand transportation services to the trucking business will force today’s trucking outfits to decide whether it is best to use certain technologies in order to work with Uber and others like it, or to combat them by using other technologies that could make them more cost competitive with Uber or other business disruptors.
Trucking companies also will need to become very good in analyzing both the available new technologies and their business needs. They need to avoid investing in “bleeding edge” technologies that, while impressive, won’t deliver large enough improvements to justify the investment. But at the same time they also need to avoid being so cautious about investing in technologies that they get left behind in the race to be more efficient and cost competitive.