In the past several weeks we’ve devoted a number of blog posts to technology – artificial intelligence, gene editing, touch sensory robotics, machine learning and more. Why?
Simple. Disruptive technologies are evolving faster than our current systems and mindsets. In other words, things like community planning, small business strategies and economic development primarily use old methods and are ill prepared to embrace growth opportunities.
Not convinced? Let’s take a look at how Lowes is using technology and then we’ll talk about what this means for small business strategy, community planning and economic development.
Lowes Home Improvement
When we think of Lowes, we think home improvement store. A big box that’s part retailer, part warehouse and a quasi-online shopping experience. What we don’t think about is that Lowes has it’s own research and development program called Lowes Innovation Labs (LIL). And if you think they are focused on drone deliveries, redesigning check out stands and retail displays, you’re sorely mistaken.
Lowes is emerging as a major player in embracing disruptive technologies and its about to change your customer experience. Let’s look at three of the most significant changes:
- Virtual & Augmented Reality – So you like the design but you just aren’t sure how it will look in your kitchen? Lowes is going to take you there. Gone are the days of 360 degree virtual videos you watch; replaced by augmented reality (AR), which can spatially take you into your kitchen to see exactly how it will look with what you’ve picked out. Fantastical? Consider that “Holo Room” was launched in 19 Lowes stores a year ago.
- Robotics – In 2014 Lowes deployed OSHbot in a single San Jose Orchard Supply Hardware. The bots, designed to greet customers as they come in were capable of speaking back to the customer in their language of choice to directing them to where they needed to go in the store. Fast forward two short years and Lowes is now launching LoweBot in select stores. Not only will this robot greet you and direct you to what you’re looking for, it will also take you there and be able to answer simple questions. Gone will be the days of pressing that button and listening to the ding followed by “Customer Service needed in the Paint Department” over and over until an agent from the plumbing department tries to help you.
- 3-D Printing – Lowes is investing in 3-D printing technology development and deployment to bring to the customer “manufacturing on demand” as a solution. Scan and print your own ideas; scan and repair a broken part; or even replicate a family heirloom (see Bespoke Designs). That’s not all. Lowes made history early this year as it partnered with “Made in Space” to install the first 3-D printer in space that can be used by the occupants of the International Space Station. Lowes and Made in Space are also working on the ability to up-cycle plastic waste to be used as its 3-D printer filament.
Cool Stuff, But What’s the Big Picture Here?
- Small Business Strategy. Small business has to up its game in order to compete. For the small main street retailer, it’s no longer a competition centered only on who’s got the lowest price and the most inventory. It’s price, speed of product to customer and most importantly the customer’s experience. The small main street retailer always had a slight customer experience advantage. How can your business exploit these changed, adapt and get back ahead of the curve? For the job shop, smaller manufacturer – this “on-demand” print manufacturing focus is going to directly compete with your small jobs casting, molding and tooling repair parts and other small batch orders. Are you ready?
- Community Planning, Zoning & Economic Development. The discussion points for cities and local community development organizations will be centered on infrastructure, innovation and incentives.
- Infrastructure. The roll out of these technologies in new big box developments right off the highway is easy, as its typically where the biggest investment is already being made in fiber availability. But those communities that want their existing businesses to be viable must start considering investments in fiber and connectivity. Small businesses are going to need both access and ‘bandwidth’ to link up to Internet of Things (IoT) and benefit from and share their own new innovations.
- Innovation. The availability and wider use of 3-D printing technology is about to explode. The focus mustn’t solely be on how your large, existing manufacturers find new business opportunities. It must also look at how you can support new entrepreneurs and innovators that are working their regular job and tinkering around with bringing their ideas to life. This is the opportunity for your community to grow jobs from within and shift commuting patterns that currently take people out of your communities to jobs elsewhere.
- To grow businesses are going to need permission and a pathway to scalability.
- Permission. First, its time to rethink ‘home based business’ zoning restrictions. They should support and encourage technological innovation, non-hazardous research and development, and small manufacturing/production operations. Doing so can lead to home grown manufacturing businesses.
- Scalability. Second, local government and community economic development groups must look at public and private investment in shared use innovation labs and manufacturing spaces. Similar to “makers” spaces, co-work space and incubators, this is the next advancement in providing infrastructure to allow disruptive technology companies and new era advanced manufacturers the space to support the scaling up of these activities. This is critical to those home based start-ups that run out of space and goodwill in their garage, but aren’t big enough or well capitalized enough to lease space (for 5-10 year terms) or build new facilities. These spaces could come from stand-alone shared spaces or working with existing manufacturers to monetize use of their technology during times when the technology is currently not used – a benefit to all parties.
- Incentives. None of these things are going to happen by themselves. Communities are going to need to look at incentives. Some options include:
- Simple, clear and accessible permitting information so that these small start-ups are clear on what they can or can’t do (needs to be a single sheet, oversized postcard and/or prominently displayed online). Nothing could be worse than to be forced to shut down a new business venture over permitting.
- Property tax abatement or exemptions for the value added in cases where home values could increase because of modifications to support home based businesses or where shared innovation space is being created.
- Tax increment Financing, late-comers agreements or public matching funds to support the expansion and connectivity of fiber.
- Education is a key element of workforce skills development. It’s also a critical factor in propelling innovation and providing small business with a pipeline of talent. Community colleges and high schools are going to need to look at new ways to create skills based learning that is not just another title for hands on learning. A good example of this is Iowa Big in Cedar Rapids, Iowa. They have brought the classroom to the shared work space and broke new ground in letting high school kids prove competency in “core” standards while working on real business projects.
Toyer Strategic Consulting is well versed in helping businesses and communities tackle these opportunities. Let’s talk about how we can help you plan, implement and succeed!