Accenture: How does Navistar approach innovation?
Julie Ragland: Innovation is a core initiative that I head up as part of our Navistar 4.0 strategy. We define innovation as having two key pillars. One is an innovation-centric culture internally: how do we use the practices of innovation to drive breakthrough thinking and improve the way we work? The second pillar centers on new businesses and new ways of doing business. While technology breakthroughs do come through in our products, we know that we also need to think about our business in completely new ways. We are trying to help the organization build this capability, in order to drive new business.
Accenture: What steps are you taking to drive innovation in electrification, reduced emissions, and other areas of sustainability?
JR: I think what differentiates us when it comes to electrification and zero tailpipe emission vehicles is that we view this as a new business model. The way we refuel, service and maintain vehicles is going to fundamentally change, along with the vehicles we choose to operate and where. As a result, we’ve created a new consulting business called NEXT. NEXT provides consultation and assistance to our customers and helps them understand how they’re going to enter this new world of zero tailpipe emission vehicles.
Accenture: How are you embedding digital technologies into your products and how is that enhancing the value proposition for your customers?
JR: Our trucks have had telematics devices embedded in them for decades. This has fostered a system of one-way communication – the truck reports back to the hub and we use that information to pinpoint where the truck is and collect health information on it. In our current generation of technology, we’ve put two-way communication in place. It means we can track the truck and provide it with instructions.
Our early explorations around this capability focused on updating the parameters on the vehicle or recalibrating our engines, so they don’t need to come in for servicing. But as our trucks start to interact with sensors in smart cities, those capabilities will need to change. The ability to have trucks respond in real time will be core to the future of our vehicles.
Accenture: Can you share what some of those new, future capabilities will be?
JR: Fairly soon, we will add “self-healing” capabilities to our trucks. We will be able to diagnose things happening on a truck while it’s in operation, and possibly even fix it before the truck needs to come in for service. All these new capabilities come from our ability to connect the vehicle.
As an IT professional, I talk about our trucks being edge computing devices; our trucks will interact with smart cities and smart highways. Autonomous vehicles are reliant on the ability to sense and respond to the environment, so the connected part of a vehicle will become core to how that vehicle operates when it comes to new, smart-city ready business models.
Accenture: Where do you see Navistar, two to five years from now?
JR: Key to our future is understanding how digital disruptions and technology trends have the potential to significantly change the role of an OEM. Are we offering our customers a truck, or are we offering a set of services and the truck happens to be the vehicle for which we deliver those services? I think we are seeing more and more that services are the core of our business, and the truck is just the mechanism by which we deliver them.