Systematic Disruption

When people talk about how compelling Steve Jobs can be, the concept of his “reality distortion field” comes up; Jobs is nothing if not mesmerizing and compelling in his ability to make people see things his way. I haven’t had the opportunity to meet Jobs, but I did sit down with Shai Agassi, founder (in 2007) and CEO of Better Place (betterplace.com), an electric vehicle services provider. Note that this is “electric vehicle services,” not electric vehicle (EV), provider. It makes a big difference. Agassi had previously been the presi-
dent of Products and Technology Group at SAP (sap.com), the global leading supplier of business software. He is one of the most compellingly persuasive individuals I’ve ever met—it struck me that maybe the reality that we take for granted really needs a bit of proactive distortion lest we end up someplace where we don’t want to be.

Briefly, Better Place is predicated on providing the means for keeping EVs running. One approach is a network of charging stations—think “gas stations” with cords and plugs in place of hoses and nozzles. Another approach is establishing places that provide a fast replacement of electric vehicle batteries—think “fast oil change,” but instead of filters and liquid being replaced, an entire battery pack being swapped out in short order. Better Place is working with both governments—from the state of Israel to the state of Hawaii—and corporations—from GE to Renault.

Given that the prevailing reality of personal daily transportation for about the past 100 years has been predicated on the internal combustion engine, Agassi’s vision is one that calls for substantial change. “Transportation systems are usually a system,” he said. Take air travel. There are rules and routes, procedures and policies. Otherwise there would be complete chaos and few air travelers would get anywhere. For the most part, the automotive transportation system in developed countries is a system, from licensing to regulations to infrastructure. But one piece is what Agassi described as being “faith-based”: People believe that gasoline will be available at their local station and reasonably priced. But what if there is a disruption somewhere along the supply chain stretching from an oil field in a far-away land to the nearby mini-mart? That’s not so systematic. So Better Place and its partners are trying to transform the ordinarily accepted and to put a significant percentage of people into EVs.

This is an immense product development undertaking. Not only have Agassi and his team had to engage allies, not only are they developing technology and systems, but they are working to overcome a century of habit. And they don’t want something that customers will endure. He wants people to love it, even though it represents a tremendous change. Yes, the tech must work. But the customers matter most.

And while there are naysayers who are ready, chapter and verse, as to why it won’t work, Agassi cites—yes—Steve Jobs and Apple. He points out how Apple made significant investments in three products that have essentially come to completely transform their markets, despite the fact that Apple didn’t do those sorts of things: iPod (ask the music labels), iPhone (ask Nokia), and iPad (ask laptop manufacturers). “If you design a new product category, you have to think of it through the eyes of a consumer, not a technologist,” Agassi said. “A company that disrupts the market does the exact opposite of what everyone else does.” So, for example, the Renault model that Agassi is acutely interested in is the Fluence, a midsize car with amenities, not a small econobox. It is about disruption, not adaptation, about fundamental change not timid incremental gains.

“Smarter is the way to compete against smart,” Agassi observed. And he’s one smart guy.