Browse
Engage
Research
This is the first part of a two-part series about the development of the Chevy Volt. This part focuses on developing the concept, and part two will focus on how the GM team delivered its pathbreaking car under incredible internal and external pressures.
When the Chevy Volt concept was introduced in early 2007, many doubted GM's ability to deliver. Even If it could be done, they believed it was impossible to deliver in late 2010. Yet somehow GM did deliver without compromise as evidenced by the widespread accolades including Motor Trend Car of Year 2010, Car & Driver 10 Best 2010, Popular Mechanics Top Products of 2010, and Green Car of the Year 2010.
I wanted to learn how GM did it and what other organizations can learn about bringing "disruptive" green innovations to market. "Disruptive innovation" is an unexpected advancement that usually combines technology and business model changes to fundamentally transform markets.
An example of a disruptive innovation is Ford's Model T. But an even broader disruption was implemented by GM's Alfred Sloan in the 1920's and 30's. Sloan is considered the architect of the modern corporation, with business model innovations that include establishing divisions, consumer credit, annual releases of new models, and creation of a supplier network.
I sat down with Jon Lauckner, who is currently president of GM Ventures. He was there when the Volt was just a twinkle in then Vice Chairman Bob Lutz's eye. Together with Bob Lutz, Lauckner is credited with defining the propulsion system for the Volt concept car that, at its unveiling in January 2007, created more buzz than any concept car in recent history. He then went on to lead the Volt program.
How to Shift From an Incremental to a Disruptive Strategy
The first step is for a company to consider the need for disruptive changes. This may sound obvious, but many companies tend to go the seemingly "safe route" with incremental improvements, line extensions and me-too copies of market leaders. And even current market leaders need to think ahead to the next "big thing."
During a period of stability and order, such as the time after the Second World War for GM, the future was fairly predictable and an incremental approach, building on existing trends was a practical approach. As Lauckner stated, "History provided a pretty reasonable prediction when developing a forecast of what the future would probably look like."
GM found the days of using history as a predictor was risky given rising complexity where new competitors were emerging, technology was accelerating, new markets were opening, regulations were intensifying, natural commodities were under stress and customer trends were changing. Lauckner declared "In an environment of rapid change, rather than rolling the ball forward with incremental improvements, a better position is to do something bold to drive future success."
Next page: The Volt's inception
"After the failure of GM's
"After the failure of GM's EV1 ..."
In my opinion, GM's failure was in not having the vision to improve and following up on the groundbreaking EV1. Abandoning a model that is accepted as a step in the right direction by both the public and by scientists is a consummate sign of lack of business vision. GM then had their lunch stolen from them by Toyota, who did have the vision to move on to a next step.
GM was given a chance to redeem themselves when Toyota's own management team failed to quickly capitalize on their groundbreaking achievement by improving the Prius even further, with both less and more expensive models.
"One could also criticize the Prius for not moving faster to plug-in..." A very true statement.
Who wrote this article? GM's
Who wrote this article? GM's marketers? I'm sorry, but this is ridiculous. The Volt is about as disruptive as oatmeal. GM had an electric car in production and on the market THIRTEEN YEARS AGO, and then they killed it as soon as they were sure they didn't have to make it. Only time will tell whether this one fares any better.
The Volt goes beyond EV1
The Volt goes beyond EV1 because it is positioned for the mainstream market and part of GM’s mainstream brand, Chevrolet. I agree that it is too early to tell if it will be the winner, but it is positioned well. Let me explain.
EV1 was definitely great new technology as the article states. But it was a 2-seat commuter car that leased at over $600 per month in mid-90’s. Maybe GM should have stuck with it, but it was very expensive to build (leasing costs did not cover). And despite the outcry at its abandonment, was there a market beyond the early adopters? It was a bit too early in my opinion.
Toyota’s Prius was a great next step in the evolution, since it was a standard car whose new technology required no change in behavior from the consumer. It was also helped along in California (the biggest Prius consumer) with the commuter benefits. Prius drivers could use the commuter lane. My boss whose other cars included Corvette and Suburban, bought a Prius to receive the commuter benefits. He then came to love it for its frugal, green operations.
One could also criticize the Prius for not moving faster to plug-in, since customers were adding plug-in technology to their cars years ago.
Since EV1 was introduced and shut-down, new leadership joined GM. Bob Lutz, then vice Chairman, had a background in batteries and was looking for battery opportunities. Volt is disruptive technology because of the range extender – the small gas engine. To me it is a simple answer for those that drive longer distances and for most others who have range anxiety (worried about running out of juice). In the future, when charging stations become ubiquitous, it may not be needed.
Apple, a technology company, that is greatly admired has introduced its share of poor products. Apple Newton, the PDA, also from the early nineties share many characteristics of EV1. The Newton was very expensive ($1000), was big for a PDA (did not fit in a pocket) and handwriting recognition was poor. Apple killed the Newton, also had severe financial challenges and then found its footing to go on to great success.
I believe all of us can learn from our missteps, even big companies like GM. Claudia Girrbach