Can we survive “Tesla-Time” innovation?

At the recent TSSS event (CSR and the Capital Markets – click for event summary) a conversation broke out about the power of corporate innovation to drive change…as you may have guessed, the company being discussed was Tesla.

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The point being made by one of the panelists was that the markets can drive great change and can be an excellent way to deal with environmental and social challenges.  For the most part, I think everyone in the room agreed but this idea gets tricky when we dig into it a little further.

A few facts. Tesla was founded in 2003.  It first became profitable in 2013.  It has yet to even launch a mass market electric car, let alone effect major change in the auto industry as we know it.  Yes, Tesla shows promise, but real change in terms of “an electric car in every driveway” is still a long way off.

Can we survive the waiting game?

If we’re talking about innovation to make it easier to prepare your breakfast or to clean your floors then the timing isn’t that crucial.  When the innovation arrives it will be discovered by the consumers, the media will rave about it, the company’s revenues will skyrocket along with its stock valuation and the capital markets will have succeeded in doing their job. Capitalism will have worked.

But we’re talking about something entirely different when we discuss climate change. The ‘debate’ over climate change is no more.  The science is clear. Climate change is an imminent threat to our way of life.  We don’t have the luxury to wait decades for Tesla-styled innovation.  We need the next innovative and disruptive business approach and/or technology that solves our climate, toxicity, scarcity, water and social challenges NOW.

Can government play a role to speed up change?

Q and A SlideSo how do we reconcile the effectiveness of Capitalism to solve some problems with its inability to recognize the urgency of others – namely climate change?  And perhaps an equally important question is, if we know what needs to happen, why do we sit back and wait for the private sector to make these changes on its own?  What role does government have in pushing a sector to be sustainable? Why do we have to wait for a Patagonia, Interface, or Tesla to eventually emerge and drive change in its sector? Certainly we must be able to use the power and influence of our governments to guide companies towards the outcome that we collectively desire.

The role of price signals

During the Q and A part of the evening, a couple of similarly themed comments came from the audience:

“People don’t like to make sacrifices. We need to put price signals on harmful behaviour to steer people in a better direction.”
      Nelson Switzer, Sustainability Leader at PwC Canada

“Should it be the responsibility of the capital markets to conduct sustainability analysis or wouldn’t it be more efficient if we had clear price signals for the behaviour that we wanted?”
      Krystin Annis, President for Clean Prosperity

I agree with this but the problem is that it isn’t happening. We haven’t done it.  We sure can talk about it but we fail to walk the talk.  We continue to let environmental and social harm dictate corporate behaviour in the quest for greater and greater profitability.

Why do we continue to let this happen?  Why can’t we get government to put roadblocks in front of harmful behaviour and smooth the pathway in the direction that we want companies to follow for our collective well-being?

“Tesla-Time”

And for those of you who feel like government must be removed from the capital markets so that companies can find their way, driven by the desire to increase profits…I would argue that we simply don’t have that kind of “Tesla-Time” anymore.

  • jbsegard

    What about pushing for that innovation: http://www.eptender.com ?

    See also https://www.youtube.com/watch?v=UnN4khtqa-U

    Modularity ! Like with your mobile phone: take (rent) a charger only for peak usage. But don’t pay and carry a huge weight just for 5 or 10 long trips per annum.

    This is a disruptive innovation which could help right now accelerating EV dissemination: the car remains lean, clean, and affordable.

  • SunWind

    Re: “Why do we continue to let this happen? Why can’t we get government to put roadblocks in front of harmful behaviour and smooth the pathway in the direction that we want companies to follow for our collective well-being?” I’m reminded of Joe Oliver’s comment a few years back, that there wasn’t an environmental minister in the world who could stand up to Big Oil. Following, when they got their majority, the Con’s went cruelly and thoroughly out of their way to pave a clear road for tars sands development, with “Our Decision Ethical Oil” intent on short-sightedly paving our collective way to hell. Our complacency, our collective comfort has been bought and paid for by cheap oil and gas, and we’re afraid that if we change all that will go. I suspect also that all of us Canadians know that without fire it’s not warm up North. There is a huge credibility and/or visioning gap – show us how you live in Canada without burning fossil fuels?

  • Robert Campbell Deeks

    It is tough to be an early adopter of innovative sustainable technology if you don’t have very deep pockets. It is doubly difficult for small business. Government will have to play some role.

  • Peter Forint

    The headline caught my attention, however, I’m going to comment on the line “[Tesla] has yet to …. effect major change in the auto industry as we know it.” Really? It’s the most innovative automobile company on the planet and has woken up the established auto sector players and governments to a world with no-compromise EVs. Do you think Mercedes, BMW, GM or Nissan would be able to market EVs without Tesla? They don’t have a mass-market car yet!?! How long did it take to have mass-market mobile phones?

    • Hi Peter, thanks for sharing your thoughts. Clearly innovation takes time and Tesla is doing something that none of the other car companies have been able to do and for that they should be applauded. However, that isn’t exactly the point I was trying to make.

      The world can survive without smart phones, in fact some would argue that we’re better off without them. My point is that our species will be in big trouble is we don’t move more quickly to address our climate change challenge and while Tesla is doing amazing work, I would argue that it’s far too slow for the comparative urgency. The issue that I have with Tesla is the pace of change compared to the urgency and the fact that government isn’t helping enough to speed up the process.

      So I reiterate my point that is spread throughout the article…

      “Why do we have to wait for a Patagonia, Interface, or Tesla to eventually emerge and drive change in its sector? Certainly we must be able to use the power and influence of our governments to guide companies towards the outcome that we collectively desire.”

      “Why can’t we get government to put roadblocks in front of harmful behaviour and smooth the pathway in the direction that we want companies to follow for our collective well-being?”

      “And for those of you who feel like government must be removed from the capital markets so that companies can find their way, driven by the desire to increase profits…I would argue that we simply don’t have that kind of “Tesla-Time” anymore.”

  • Bruce McKean

    My sense is that governments are already involved (at this point the Harper Government can leave the room until replaced): Tesla and SolarCity both benefit from various incentives and subsidies from (many) states and provinces. I am not saying that it is sufficient unto itself but it IS there. The greatest change so far is the change, not in profit margins or number of electric vehicles on the road so far, but the psychology. This is by far the greatest contribution and lasting contribution. We collectively are a consumer iceberg and when the shift occurs it will be fast and dramatic. I believe we are on the cusp right now, not a decade from now.

    And in the meantime, can I interest anyone in a new coal mine? I thought not: Teck has shut down ALL of its coal mines for three weeks because of a lack of demand.

    (Excuse me now as I must go back to my lab to perfect my new battery that will take you 1000 km between charges and settle that silly “range anxiety” thing that people seem to have.)

    • Bruce – good luck with the battery. While you’re at it can you please try and invent a car that runs on water 🙂