The car – a transportation service

“Technology is transforming transportation in the same way it’s transformed media, music, you name it”. And; “Society is ready for this transformation, and the transportation industry is ripe for disruption”. This comes from the San Francisco Chronicle article from October 22, 2016 (click here for access to the article).

Cars are getting closer to a future where they can drive themselves -cars get smarter and more connected. Such autonomous vehicles are the ultimate destination for cars’ transformation. Cars will eventually be a service – a solution to a problem. The problem to be solved is getting from A to B quickly and safe, without spending personal energy on the trivial task of steering the car.

Another kind of transportation service different ways of linking vehicles to drivers. Two major car makers, General Motors and Audi, have just launched car-rental operations in San Francisco. In this articles by Carolyn Said in the Chronicle October 21 2016, she writes about GM’s program, called Maven, which offers hourly rentals that consumers access directly from parking lots and garages citywide using a smartphone app to unlock the vehicles, which don’t require keys. Audi’s program, Audi on Demand, offers rentals by the day that concierges deliver to renters who can book them via an app.

This is new: The manufacturers work directly with consumers – not on a purchase basis, but for temporary use. In this way, as we can read in the article, automakers are laying the groundwork to have a role in the future of how people access cars.

So manufacturers are preparing for a shift in how people buy cars. We need to talk about cars and transportation as a service, not a car as a physical product.

The GM service is fairly similar to Zipcar, Enterprise CarShare and CityCarShare, only that GM is the manfacturer, building relationships with renters, who GM hopes can become future GM car owners. Also; GM and Audi want to make sure that their rentals have the latest and greatest technology. This is not the case with Zipcar and other companies that offer hourly rentals in dispersed locations. GXM radio.

When it comes to the two questions this blog covers: 1) How to apply service innovation research to organizations, 2) and why? I will propose these answers.

Regarding how to apply service innovation research: one needs to couple the question of What problem to solve for users or consumers with the question of What is the service aspect of the car? Problem: Customers need to get from point A to point B in a safe manner The service aspect: The automation releaves the driver for the energy of actually driving the car.

Why service innovation research? My main point here is that a car is primarily not a physical object; it is a service, a transportation service. The Service Innovation Triangle, presented in one of the Categories in this blog, is a great tool for analyzing the car. The car needs to be a value-driven service innovation – it needs to create value for both consumers (users), providers, and corporation owners at the same time.

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