So the car emissions cheating scandal gets Worse. The thing is it seems that for a great many years there have been government regulations that simply have been beyond the reach of some, many or even all manufacturers. In simplest terms VW (or Mitsubishi) could not make a Diesel engine that met standards at a profitable cost point. Now if it turns out that all manufacturers have been cheating then the fault is ours – regulations were set beyond technology and we simply needed to take a different approach to lower emissions (more congestion charges, more public transport, different city planning guidelines – you know, hard expensive decisions)
But if some manufacturers could do it (and it seems the higher end engines from BMW did make it) then the issue is one of company structure and culture.
So let’s imagine we are a middle tier car manufacturer looking at our current capabilities. We find our competitors can meet standards but at a higher price point – but we don’t think we can do it. We have several options
- Abandon that market segment – it’s not profitable
- Stay in market segment as a loss leader
- Improve our engineering capabilities so we can do it
1. And 2. Are interesting – they are essentially strategic business decisions. They have little or nothing to do with the technology, other than having an honest and open appreciation of the technology realities. (This is a very hard thing for an organisation to have)
3. Sounds simple but is by far the hardest – it is however linked to that “honest and open appreciation of technology realities). A technology led organisation needs to be able to pass accurate balanced good and bad news up and down the chain.
To do so means psychological safety as a prime goal.
But if you don’t have that, how do your employees pass that kind of news up to you?
You have to assume everyone is frightened to give you the bad news and work accordingly
Otherwise you won’t know enough to know to decide between 1. and 2.