What is really intelligent? Intelligence or Artificial Intelligence!

A human child learns to handle objects at a very young age. For an AI algorithm, it takes hundreds of years of training to perform the same task.

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In the last ten years, terms like AI, AR, VR et al are coming in news and in discussions. AI is artificial intelligence whereas AR is augmented reality and VR is virtual reality.

Augmented Reality is an interactive experience of a real-world environment whereby the objects that reside in the real-world are “augmented” by computer-generated perceptual information, sometimes across multiple sensory modalities, including visual, auditory, haptic, somatosensory, and olfactory.  Virtual reality completely replaces the user’s real-world environment with a simulated one.

Virtual Reality is the computer-generated simulation of a three-dimensional image or environment that can be interacted with, in a seemingly real or physical way by a person using special electronic equipment, such as a helmet with a screen inside or gloves fitted with sensors.

Artificial Intelligence is the theory and development of computer systems able to perform tasks normally requiring human intelligence, such as visual perception, speech recognition, decision-making, and translation between languages. I will be writing today only about AI, in the language that I can understand.

Enough of tech things, hopefully, these definitions have indicated what these things really are. Coming back to the title, an obvious conclusion will be Intelligence is more intelligent than Artificial Intelligence. The answer is both yes and no! Yes, is because after all the creator of artificial intelligence is a human. When we talk of intelligence it is about human intelligence! QED! No, because Intelligence and Artificial Intelligence are two different animals and supposed to handle different things. Hence making this comparison may not be the right thing. In human life, decisions are not taken as 1 & 0 every time. AI activity is about a decision-making activity, always, as 1 & 0!

Consider the BOTS. BOTS are Web Robots. When we go into a Chat mode with a site like Amazon, chats are handled by BOTS, these days. How do the BOTS work? During chat customers usually, ask a certain set of questions. Depending on the standard questions asked BOTS are trained to give replies. Generally, it will say, “How may I help you?” Depending on the what the customer says, about a certain order or delivery issue or a quality issue, BOTS system (yes, it is a system though initially it is trained to say I am Vijay or some such name!)  in Nanoseconds, will run through its database and type an appropriate reply. Maybe in 70 to 80 % of cases, BOT can find the answer. But in certain situations, it cannot find a reply. In this case, it is trained to say, “let me ask my seniors, could you hold on, please?” Then a human supervisor, who handles about 20 BOTS, takes over and resolves the issue. This is like self-checkout counters in foreign countries where there is one supervisor to support ten machines used by us!

What really is AI? Even the most sophisticated AI technology is, at its core, no different from other computer software: bits of data running through circuits at super-fast rates. Where AI falls short is thinking in the abstract, applying common sense, or transferring knowledge from one area to another. For instance, Zomato might be very good at reserving restaurant tables, a narrow and a very specific task. There are many proven instances in which AI models fail in spectacular and illogical ways as soon as they’re presented with an example that falls outside of their problem domain or is different from the data they’ve been trained on. The broader the domain, the more data the AI needs to be able to master it, and there will always be boundary line cases, scenarios that haven’t been covered by the training data and will cause the AI to fail.

Contrary to computers, humans are terrible at storing and processing information, comparatively. For instance, you must listen to a song several times before you can memorize it. But for a computer, memorizing a song is as simple as pressing “Save” in an application or copying the file into its hard drive. Likewise, un memorizing is hard for humans. Try as you might, you can’t forget bad memories. For a computer, it’s as easy as deleting a file.

When it comes to processing data, humans are obviously inferior to AI.  Humans might be able to perform the same tasks as computers. However, in the time that it takes for a human to identify and label an image, an AI algorithm can classify one million images. However, humans can make abstract decisions based on instinct, common sense and scarce information. A human child learns to handle objects at a very young age. For an AI algorithm, it takes hundreds of years of training to perform the same task.

There are robots in Japan to take care of senior citizens. They handle routine tasks. But if it is suddenly asked which was that movie you had seen in 1960, it will not know. But if you ask this question to a human who is your friend from childhood, he will suggest to you the names of five different movies from that period. This is the difference between Human Intelligence and Artificial Intelligence. The robot, in this case, is not expected to give a reply. Artificial intelligence is good at processing data, bad at thinking in abstract whereas Humans are bad at processing data, good at making abstract decisions.

Humans can invent new things, including all the technologies that have ushered in the era of artificial intelligence. AI can only take data, compare it, come up with new combinations and presentations, and predict trends based on previous sequences.

Humans can feel, imagine, dream. They can be selfless or greedy. They can love and hate, they can lie, they forget, they confuse facts. And all of those emotions can change their decisions in rational or irrational ways. They’re imperfect and flawed beings made of flesh, which decays with time. But every single one of them is unique in his or her own way and can create things that no one else can. Robots do not have all these properties. They will keep on doing a repetitive job, every time. They don’t get old but their component may fail. They are emotionless.

While chatting with friends, one of the friends, who is in the same field as Jaya, was pulling Jaya’s leg.  He asked her, “What is the difference between AI and real Intelligence?”  Jaya smiled and told him, “You are artificially intelligent, I am really intelligent”! So, it’s simple, never compare AI and human Intelligence; they are oranges and apples!

Do we have it in us?

Hence, bigger and larger want to be in China and not India!

Historically, in the last two hundred years at least, we have seen nations moving from Agro Based economies to Manufacturing economies to Service based Economies. The latest classic example of this is China. From 7th decade in the last century, till today they have shown fascinating growth and China has become the manufacturing hub of the world. India was late in this transformation and we were forced into liberalization by the precipice we reached in 1992. India had no money to pay for foreign goods/debts and had to move their “family gold” (it is the gold stock that nations hold for such situations) abroad to borrow the money. Rest as they say is history. 

We reached a growth rate between six and eight % and the effect of that growth is seen all over India, in the last 25 years. But there is a twist in the story here. India has not exactly skipped the manufacturing phase of the growth but it appears that we are jumping more towards the Service based economy. I was wondering why this is happening and as usual, found that this is very complex to understand and even more complex to explain but still I am venturing into trying to explain.  

First and foremost, I feel that with the internet around and excellent connectivity world over, we all know what is happening anywhere in the world. What new products are available, what better gadgets are available is known the world over,  very fast. So, aspirations of the people change very rapidly. But the generations don’t become rich in such small durations. With 8% kind of growth and the speed of growth, this change is even more lopsided than in olden days. Rich are becoming richer faster and by leaps and bound. The disparity between the rich and the poor is galloping rapidly.  This is where the comparison between China and India always comes into the picture. There is no question that China has done much better than India during this period but at the same time, there are certain human aspects that need to be understood. 

China still has a lot of poverty but with the authoritarian government, they make sure to hide this fact. If required, they block websites which try to display such things. Beijing does have a large poor area, well hidden from prying reporters. If any reporter tries to break the government diktat, the reporters get thrown into jail. China simply crushes uprisings or behaviours they don’t like. In India, we are opposite to that. We have people in our society who love the display and discuss India’s poverty by making an argument about freedom of speech but the main reasons are always political. We have this history. In the olden days, 60’s in the last century, we had people like Satyajit Ray who took pride in producing films which advertised India’s poverty. By no means I am saying not to discuss our poverty, in fact, we as a nation should accept facts of life then only we can improve, denial mode is not going to help anyone. But pride in showing poverty is a bit too much.  

With an authoritarian government, it was very easy for China to declare one-child policy. This has brought down population growth rate drastically from 90’s of last decade. This helped China improve per capita income. In India, we tried family planning but it did not succeed as it was done half-heartedly. In poor strata of the society the family planning was a disaster and hence our per capita income showed an increase but not to the extent China could show!  

Government policies about manufacturing, imports and exports have changed very slowly over a period. With this, there was not much incentive for global giants to be in India. By the time they started coming in the bigger way, we see the reversal of trend due to other reasons. Electric Vehicles! EV’s are changing world scenario rapidly, though we may not see many EV’s on road for next five years, the development and investment patterns of these giants are now changing and trying to adapt to their new global strategies based on EV’s. India is not a priority for them! For their own reasons GM and MAN trucks have withdrawn from India and some more are expected to do so. But what happens in China? India’ pride and numero uno, Suzuki has completely withdrawn from China. In India, its share is more than 50% but in China, it was less than 1% of the market! This indicates that Chinese and Indian market requirements are poles apart. Hence, bigger and larger want to be in China and not India!

Another thing that happened in between was Y2K. I am not still sure if it was a real problem! Not a single failure of any system was declared in the world when on 01/01/2001, the Sun rose in the sky! To me, it was more of hype than the real problem. Indian service company giants made a real killing out of it! There came up new industry czars and they popularized the culture of white-collar subcontractors. It was good for the country that finally we started making big money. We started to have a society of young millionaires initially in Rupee terms, then in dollar terms too! Life has been Roses all the way. So, why bother to disturb the bandwagon.

There were some hopes in the industry when small companies like Quick Heal and Tally started making software products but this trend never caught up for the fear that we will lose on easy money. Yes, there appeared to be the trend which showed some changes a couple of years back. But these were due to one Mr Trump who started changing visa rules for our service giants. Not because the Giants wanted to change their ways and go up the value chain! What’s in a name? As long as hot dollars keep coming in the kitty nobody is bothered. Even in the IT industry where we supposedly have thousands of trained manpower, we have missed on things like IOT, AI, the Virtual reality which are already on the way. Are we ready for this? Using these new things company’s world over are creating “products”. Do our glorified contractors have the gumption to take up the challenge? Do they have will to fight it out with Silicon Valleys of the US, Israel? Or do we want to remain service providers to these new product companies? I am hearing the names like Tally and Quick Heal of the new era but I am honestly doubtful that big shots will take it up. Probably, it is better to be the doyen of the industry with billions in the pocket, giving talks blah blah blah. Why bother about being a struggling product creator?  

I am always positive about everything, but I am really not sure of service providers switching to a new avatar of products manufacturer. There are always very few Steve Jobs and Bill Gates! India has already jumped to service industry in the transition!  

Lathe Joshi!

How to handle Tsunami of change?

Lathe Joshi is a film about one Joshi, who is an expert lathe machine operator. As per the famous rule of this world, “Change is the only constant”, one day his world changes when the workshop owner decides to close his workshop as it is not profitable. Joshi loses his job. But he is not willing to change. He does not want to acquire new skills, nor does he want to retire and join a bhajani mandal to pass his time. He tries to buy the lathe from his old owner but it does not work out. His wife, and son change as per needs of the modern world; though they struggle initially, later they settle down with a reasonable success taking up modern work. They change with the time. Joshi who is known as Lathe Joshi remains Lathe Joshi and has a tough time in later life as he is out of tune with his family, who try to help Joshi. 

We see many Lathe Joshi’s in this world! Last 50 years of previous century changed our world drastically but the changes in the 18 years of this century are breath taking to even reasonably techno comfortable people. Many new things, modern things are making life easy and tough at the same time. Many gadgets that were standard in any office, have become extinct e.g. type writers, filing cabinets, typists, filing clerks. Now every person whether he or she likes it or not needs to reskill, retrain. If it is not done then it will not take time for these people to become Lathe Joshi.  

But is it necessary to change everything old? No way! Everything in the world does not become modern. Old values of love and empathy remain intact! We should all respect each other as human beings. In many areas, what changes is the method of doing things, processes being followed but basics don’t change.  

When anyone goes to take a loan from a bank, that company or the individual needs to provide various documents. These documents now can be submitted electronically, processed electronically and approved electronically. I am sure loan departments of banks are shrinking. We see the same thing while making payments and withdrawing cash. It is said that in next five years number of physical branches of banks will reduce drastically! More Lathe Joshi’s?  

Modern technology makes buying a totally new experience. Amazons and Flipkarts are changing the way we buy things; items bought still need to be shipped so shipping industry will not change. In fact, there will be more and more jobs available in this sector. The courier service, tracking of parcels will become more efficient. But in logistics basics don’t change! Whenever we have any issues with these companies, we chat with their representatives. These “representatives” are many a time BOTS, robots who can chat with you. There could be one human supervising 10 BOTS, same as self-check-out counters in the malls. As far as humans are concerned, obsolescence will happen! Retraining for people in this field is a must!  

Obsolescence looks to be the name of the game but it is difficult to predict what will happen in future. When experts find it difficult to predict, for common person it will be almost impossible to predict and judge about future. Look at the automobile industry. Since last decade, people have been talking of Electric Vehicle (EV). But it looks like finally everybody is jumping the bandwagon. In an IC Engine vehicle there are hundreds of parts in the drive train, which is in between radiator in the front and the exhaust system at the back. These hundreds of parts will be replaced by about 18 parts in the EV. Out of these 18 parts 10 will be electronic controllers! What will be the scenario in 2030/2040? This change is bound to happen once the inflection point is reached.  

An inflection point is an event that results in a significant change in the progress of a company, industry, sector, economy or geopolitical situation and can be considered a turning point after which a dramatic change, with either positive or negative results, is expected to result. Companies, industries, sectors and economies are dynamic and constantly evolving. Inflection points are more significant than the small day-to-day progress typically made, and the effects of the change are often well known and widespread.  

The automobile sector changes, will affect this world in both good and bad ways! Good way is that air pollution will reduce drastically due to lesser use of petroleum products. World will become free of OPEC hegemony. But the bad part will be that  hundreds of thousands of parts currently used in the industry will not be needed. These industries will become obsolete, even though they may want to change. The industries like casting, forging, heat treatment will shrink in size, drastically, world over. This obsolescence will be simply path breaking and breath taking. Top manpower, highly skilled, will become Lathe Joshi’s in very large numbers! Even though they may be willing to change, system will find it difficult to accommodate such large numbers.  

Friends there appear to be obsolescence of two kinds, one is like our friend Lathe Joshi. He simply refused to change and adapt. He did now want to go with the flow and change. Lathe machines were replaced by modern system performing many things simultaneously. But the changes I have mentioned due to EV, are mind boggling. I was chatting with a younger friend running a service industry and manufacturing machinery, for auto industry. His is a core automobile business. He is running the business very successfully. While we were discussing life in general in a party, I asked him a pertinent question about effect of EV’s on his business model. He said, “Pramod, I simply shudder to think about it. I am in business for 25 years, I have funds, I have technology and I have risk taking ability. Business  men running auto ancillaries today, will have to adopt from 2030 onward. There will be thousands of people with my background running businesses very successfully today. How can they re-skill themselves? How can they retrain themselves? It is going to be extremely tough. Luckily by that time, I should be around 70, so it will be left to my next generation to bother about these things.” He smiled and said, “I will make sure that I have retired by then”.  

If a smart person like my friend who employs 100 people, does not know what to do ten years hence, what will these 100 people know about their future?  I am definitely a positive guy but as of now, I am also flummoxed! Yes, there will be solutions, but people will have to make massive changes in their thinking. In whatever new industries come up, people will have to retrain massively to join them. When a lathe was replaced by machining centers, it affected a small group of people world over. But the advent of EV’s is going to create a tsunami and will create more Lathe Joshi’s in the initial period, as there will be millions and millions who will have to adopt! Retrain, re-skill from today? What skills will not be obsolete 20 years hence, I do not know!  

 

Jalyukt Shivar Abhiyan, a New drive in Water Management!

Jalykukt Shivar Abhiyan, my understanding of the same.

Jalyukt_Shivar_Abhiyan_Logo

The Maharashtra government has launched, with Pani Foundation, water conservation scheme named Jalyukt-Shivar Abhiyan to make Maharashtra a drought-free state by 2019. The program aims to make 5000 villages free of water scarcity every year. Jalyukt-Shivar Abhiyan means a journey towards village surroundings full of water! This is all done by Shramdan, self help, people of all walks of life offering free services, in most cases manual hard work. These groups have people who live in those villages. The drive has caught on very well and Hindi film hero Amir Khan has driven this movement by providing celebrity support and perseverance . He has taken along with Hindi film fraternity, Marathi film personalities like Sunil Barve and others too! I am sure this will help in sustaining the drive. Their organization provides technical support and training to people for correctly doing these things. It is because of the leadership and drive provided by personalities like Amir Khan, there has been a good progress. I am told that the government agencies are also waking up, albeit slowly, because the Chief Minister Mr. Fadnavis is also giving great push to this drive.

I am trying to understand why such tough situation has arisen. Along with increase in population, need for more crop production has also become essential. There are some crops like sugar cane which need large amount of water per acre. India’s sugar production has reached a level of 30 million tons against the requirement of 25 million tons. So, this is excess production! The rain is the only primary source of water for us in agriculture and day to day life; but nobody can be sure that the rain will definitely fall on specific days. Hence, we have gone for water irrigation in a big way, by building dams and canal system. Water available for irrigation is again dependent on rains! But irrigation can also reach limited areas. So, at some stage, this water is not going to be available for farming till the next rain cycle. India is not a country of perennial rains and we have our rains in specific months due to south west or north east monsoons. People started reaching out to third source of water, the wells and so they starting using ground water. Again, the same cycle repeats here and we are dependent on rains, when wells dry out. That is the phase where people started using bore well technology to get water from the ground. It will be good idea to know how we ground water is stored. This will really pin point real problem we are facing.

 hydrolic-cyle-water-shed-developement-5-638

The study of water flow in aquifers and the characterization aquifers is called hydro geology. An aquifer is an underground layer of water-bearing permeable rock, rock fractures or unconsolidated materials (gravel, sand, or silt). Groundwater can be extracted using a water well. The study of water flow in aquifers and the characterization of aquifers is called hydro geology. Related terms include aquitard, which is a bed of low permeability along an aquifer, aquiclude (or aquifuge), which is a solid, impermeable area underlying or overlying an aquifer. If the impermeable area overlies the aquifer, pressure could cause it to become a confined aquifer. So water availability really depends on unconfined acquifers. Though other areas under ground store water, this is a a very slow process and impermeability or low permeability does not allow water to reach confined acquifers quickly enough. Once we start touching these storage areas, we are in trouble.

Why have the water conditions gone from bad to worse? What does the Jalyukta Shivar Abhiyan do to change this situation? The government of Maharashtra has a law which forbids drilling of bore wells beyond 250 feet or 80 meters. Is there any cross check on this? No, the bore wells have been drilled to the depth of 250 meters, 3 times the allowed depth. How many bore wells can be drilled in an area? My friend Shende told me the other day that in Solapur district where he does farming, in an area of 4.5 to 5  sq km, there ten thousand bore wells! To me this is beyond indiscriminate, it is criminal. When he told me this number, I could not believe it so I asked him again and he said the figure is right. If you try to suck ground water from so many wells what will happen? You don’t get water even at the depths of 250 meters. Ok, our population has gone up so we need more water, crops which need a lot of water are planted in abundance, sugarcane is the prime example of that. In India, this year we have manufactured 30 million tons of sugar against our requirement of 25 million tons. International sugar prices are already low so there is a big problem! On top of that we do this indiscriminate pumping. We don’t need experts to say what will happen!

What is being done under Jalyukt Shivar Yojana? The main aim is to increase the water table levels in areas where possible. This is done by various methods. Over a period, top soil in many areas becomes impermeable. Trenches are dug, contour digging on slopes is done. This increases the ability of the soil to absorb water. All the actions that are taken are to ensure that during rainy season, the water that we get, seeps to the water table in the area where this work is done. When these actions are not taken, the top soil in that area would be like “opaque glass”. The water would not seep but would flow away to other areas, making the top soil only wet and causing erosion. When the dredging is done by various methods, the soil becomes like “transparent glass” and water seeps through easily.

I asked my friend Shende what benefit they are expecting after this year’s work. He said that last year, only 1 % of their water needs for farming were met. They expect that after this year’s monsoon, because of the work being done, the availability should go up to 25%. They expect water table to come to the level of at least 80 meters. This is quite a jump but nowhere near what they need. What should the society do in general? First and foremost is the discipline; unless we follow basic discipline of depth of bore well, water table issues will continue. Secondly, maybe people should try and cultivate products which are suitable to the water availability. When we don’t use ground water, it does not go anywhere. It remains there. But out of fear that others will use the water anyway, everybody breaks the discipline. The thought process is probably, if I do not get it then I will not let others also to get it.

Let us not forget that earth is the only natural resource that human race has. Once any resource gets depleted, it can take thousands and thousands of years to regenerate it. By pursuing this current drive relentlessly, we will probably get a method, whereby we may be in a position to get water regularly for agriculture and drinking! The nature does not have द्रौपदीची थाळी, a Marathi idiom for unlimited resources. We think it has. Civilizations in olden days have gone down the drain, no pun intended, over a period of time due to indiscriminate use of natural resources. Cape Town in South Africa will become water less in a month of two. There is a serious a discussion going on to pull some Icebergs towards Cape Town, to get fresh water. To me this is the first step towards disaster, in terms of bore well we are trying to dig to 120 meters! So let us heed to such warnings unless we want to be left water less and I don’t know what worse scenarios.  Honestly I can not imagine one!

EV’s! The Eco System Disruptions!

Are we prepared for major disruptions in many Eco System due to advent of EV’s?

Below is an article which informs us about governments seriousness regarding introduction of EV’s in India. It is hoped that at least 30% of all new new vehicles by 2030 will be EV’s. Last year, government ordered 10000 EV’s and there is a plan to order the same quantity this year too! Government is also encouraging bus fleets to buy Electric buses. Himachal Pradesh has ordered 25 such buses and are being run in hilly areas. I saw a few of them plying, during my recent holiday in Manali.

http://www.downtoearth.org.in/news/centre-launches-national-e-mobility-programme-10-000-more-e-vehicles-to-be-procured-59845

What EV’s are going to do to various Eco Systems? When we discuss EV’s, discussion is about pollution, how long petroleum products will last etc. There is also a discussion about petroleum cartel holding human race to ransom. But there are many more disruptions that need to be considered. These are not only for individuals but for various agencies like government, businesses and many other systems. These need to adapt, change and modify to suit new environment created by the EV’s.

Take the case of governments tax collection. Tax collected on petroleum products are so huge that these are almost 100% of the price of the petroleum products. At every stage tax is collected. From refining, to distribution to sell. Both central and state governments will start losing this revenue when critical mass of new EV’s is reached. 2030 as indicated in the above mentioned article, may be that year. Government needs to find methods to make up for this revenue loss. Not all revenue will be lost but there will be a loss of big chunk. Another issue is the “fuel” that will replace petroleum products will be electricity which traditionally is being manufactured in Public sector. This fuel cannot be taxed very heavily,  as its usage will be multi-purpose, vehicles, industrial and domestic usage.

Another major change that has to happen is the growth in production of electricity. If this continues to happen using petroleum products, then pollution will come out of chimneys instead of car exhaust systems. Main thrust appears to be on solar systems but they will also have their own issues which need to be tackled in parallel with increase in production. Another method that is being undertaken is nuclear power. This will also help the ecosystem to achieve the same goals.

Why would people switch over to EV’s? In case of buses, since it is a public transport this can happen faster if funds are made available. These organizations are anyway public sector. Of course, cost of the vehicles needs to come down. From present knowledge, it appears that maintenance cost will be lower. With decrease in Electricity price, battery replacement costs may also become quite manageable over a period of time, due to mass production.

But the real numbers will be coming in cars. Why will people change over to EV’s, the cars? Cost of ownership is the going to be the answer. This is made up of Price of the Vehicle, Cost of servicing, cost of repairs, resale value and ease of use. To me the last factor is also very important though it is not a tangible factor. All other factors have been there in IC engine cars too! But this is a new factor that has come up. We are all used to just using the key to go where ever we want; if required, we go to the petrol pumps and fill it up! With EV’s it may not be as simple, to start with. We need to plan, we need to have cars that will give more mileage per charge. The current charging technology available takes about 30 to 40 minutes minimum, to fully recharge. How fast this technology will improve? Will the charging time reduce to 5 minutes or some such time? Only time can tell. This brings us to charging stations, which is going to be a factor by itself!

EV’s will need charging stations, bus operations will have their own stations. But cars will need a huge number of charging stations. In India, we should not forget two Wheelers. Two-wheeler companies are also thinking big in terms EV’s and those numbers could be large. First and foremost is going to be the charging time! Unless this reduces drastically, number of charging stations needed will be a big challenge! So, to me this improvement to around 5 minutes or less is almost mandatory! I am sure the improvement in battery technology will increase the capacity of batteries which in turn will increase per charge running of vehicles. Who should invest in charging stations? Who will invest in charging station? Current Oil companies can take up onus of this, being public sector companies. Chicken and egg situation will prevail in initial phase. Charging stations first or EV’s first will be the dilemma! ROI on charging stations will be tricky and priorities is going to be an issue. Till IC engine vehicles are manufactured, they will keep on having the pressure of exhaust pollution control. By 2030, something equivalent of Euro 8 or 9 standards will be prevalent.  Car companies and Oil companies both will have to invest a lot on pollution control during this phase, along with investments in EV’s. This is tricky because nobody can predict the speed at which proliferation of EV’s will take place. Lest we forget, EV’s are Zero pollution vehicles!

About charging stations, will the government agencies build them or private agencies build them? Private companies have an option of not building them. There will be  individuals who may have proper parking space in office or at their home. They will build their own station but that number is going to be small, at least to start with. But looking at vehicles parked on roads even at night in cities, common charging stations, like petrol pumps, looks to be the only way. Can there be a “Charging Station Cess” on all new vehicles sold? Will it be acceptable to burden IC’s engine car buyers to benefit EV buyers? Can local governments take part in this, in cities where EV’s will be sold in large numbers? When will they know the trend? When will they decide to do it? All these questions do not have easy answers, but these issues need to be resolved.

The drive train in IC engine cars, starting from Radiator and ending with Exhaust pipe, will be replaced by about 18 parts, maximum. Out of these, the motors and gear are the only so called moving parts! When there are less moving parts, there will be less repairs needed! In fact, Tesla is offering life-long warranty for their cars. So, the car service industry will be the first victim of EV introduction. Today major chunk of repairs after warranty period is over, are the drive train parts. When these repairs are simply not needed, will the service industry be viable at all? Will manufacturers offer the paid service life long, through owned outlets. This is already happening in spare parts business, where component manufacturers find it difficult to compete with the vehicle manufacturers.

Another major disruption will be component industry and their basic vendors like casting, forging industries and their allied industry. These industries today, employ millions of people. Since there will a major disruption in this eco system, things are going to be tough. If a certain business simply ceases to exist, what do you do in life? Not everyone plans 10/15 years in advance. By the time they realize this, it could be too late! This group of business men will have business knowledge but may not have where withal to completely switch over to something new! How many will be smart enough to change to a totally new and/or unconnected business?

Friends, I have seen my city Pune change from use of carriage pulled by horses (called tanga), to auto rikshas, to Ubers and Olas. Tangas simply don’t exist now! I have observed that riksha business will also taper off over a period of time. Riksha is not an elegant mode of transport and it appears that young generation does not want to come in this business, as it is NOT COOL! The advent of Metros in the city in next three years will push Rikshas and even Uber/Ola! I will definitely use a Metro, if possible! When I talked of major disruptions, I was talking of obsolescence too! History has been harsh, and there is no replacement or option for obsolescence. If a system has to go, it has to go whether it likes it or not! It is like death, one has to accept it. Welcome to the brave new world of EV’s.

I am the best!

Going up the value chain is the only option!

Our Tera Firma is full of smart people. In last 50 to 70 years the innovations, evolution of technology has gathered momentum which is far swifter than what happened in previous 2000 years. This has happened because of the people who besides being smart, innovative were humble too or may be some of them were not! They knew that any idea that becomes popular may easily get pushed aside by a better idea or a product. Maybe some of them hardly had any choice as one can’t stop advent of new things especially in technology area. 

Digital cameras is a classic case of the  inventor  being  flat  footed.   Digital  cameras  were  invented  by  Kodak ,  the  pioneer  in  cameras  and  films.  They  invented  the  digital  camera  but  apparently  forgot  about  it. Later Cannons and   Konicas  of  this  world  just  blasted  Kodak  out  of  business  by  bringing quality, reasonably priced digital cameras in the world in large volumes. By the time Kodak woke up it was too late! They went into bankruptcy. Now these same digital cameras are being included in cell phones. These cameras in cell phones, are becoming better and better. So, what is the future of digital cameras as we know them? Honestly, it is difficult to judge but is it possible that digital cameras will come with a SIM card in future or we may have cell phones with better and better cameras. I am not talking fantasy. Recently I read that Jio, Mukesh Ambani’s company is bringing out Laptops with SIM cards with the idea of always being connected. Then do you need WiFi? I don’t know what this will do to the current market conditions. However, there are already cheaper hotspot devices, with 4G, available in the market. For a fee of Rs.400/ per month this hotspot can be connected to 10 devices. Then will we need SIM card for an individual Laptop? This is how the technology is changing swiftly. All the current and new players in the market will have to come up with their own variations to ween away customers towards their technology!  

Electric Vehicles, especially cars, were considered as niche products in the market and maybe people thought that they were competition, at US $ 100,000/ price, to high end cars like Mercedes, BMW and Audi. This was only a couple of years back. Besides Tesla, other car makers are also showing nimbleness. They have already come with their own EV’s and going strongly in bringing EV’s in mass production.  The other car makers already know how to manufacturers millions of cars, so once they master Electrical drive train technology at a competitive price, things will change drastically. What will happen to today’s drive train industry? We don’t know. But there is a good chance that this industry will become sunset industry. Maybe 20 years? I have had a discussion with couple of friends who are running allied industries in auto field. They are worried and are already thinking in terms of change over. Their nimbleness will help them. But a few others are still saying that EV’s is a passing fad! For their sake, I hope they are right but my mind tells me otherwise. They are “I am the best” types.

We see similar case in Indian IT industry. Our IT business was started by doyens of IT industry. They have done a fantastic job of bringing India on world IT map. Indian IT business grew by leaps and bounds and has created technology culture in India. They also created large number Indian millionaires and now billionaires. Their contribution has helped India in other sectors! They have made India confident too. But during last few years there have been signals, that this model of service providers is not going work for a long time. Indian companies need to go up the value chain. These companies on Nasdaq are officially described as “Providing technology consulting, application, system integration and engineering services” that means these are service industries. In India, they call themselves as software  companies.  It is with this false nomenclature they have started thinking that are software product companies.  They started the culture of people sitting on bench, as per demands of their customers. For those who don’t know the meaning of “sitting on bench” this is what happens. The customers ask the service providers to ensure that additional 20% people are assigned to the project but they have no work. If the project is of 2 years duration,  then   these 20% folks have no work for two years.  What culture have we developed? Should we not be going away from this method? 20 is a substantial % to be forced to remain idle. This according to me is poor management, in crude language run by bean counters. Is profit the only motive? What about the career of 25/30 year old young people? Once they get used to this life, they would be happy to remain idle, if possible, all their life!

Once there was a meeting between a doyen of IT industry with CEO of an American company.   The American company is a world’s top end product company employing 5 thousand people   where as the Indian company employs  1.5 lacs people.  Out of 45 minutes meeting the doyen talked for 40 minute and the CEO for five minutes. Both their turnovers are same. Doyen never felt it necessary to find out how the same turnover is achieved with so few people. He must have got same opportunities to talk with many such people world over but probably, “I am the best attitude” has kept the thought process where it was ten years back. I hardly read any news about this company trying to go up the value chain. Attempts made by a new CEO were brought to null by the doyen with his “Expert” knowledge! In such fast changing world, even a year or two of sluggishness, can put a company under severe strain; but maybe these “Limited” companies are “personal limited” companies even though share holdings of the doyens are low. Going up the value chain, what is that? I know how to run this company. “I am the best.”

All the best to Indian IT industry and hope better sense will prevail at some stage. I have seen enough small companies which have made software products and are up the value chain. Typical case is “Tally”. They have made an ERP suitable for India and millions of copies have been sold. Quick Heal is another company that comes to mind. Their security products have become well known. For both these companies their Profit/Turnover per employee is pretty good. If these smaller companies can do it why all the service giants  cannot do it? They have mountains of cash reserves. They don’t know what to with it. Is it the proverbial  Ostrich’s head in the sand?

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

 

 

Game Changer or Disruption!

EV is going to be new beast compared to todays cars!

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I have been writing about Electric Vehicles; for updates I keep on talking to people in the industry, read on the net and am lucky enough to have someone in Tesla to update my understanding of EV’s. I am no technical expert in this field but I can feel that something big is definitely happening. Hope I am able to see some of these major changes in my lifetime. I was lucky to be part of two such events, Internet and Cell phone. These two disruptions have  changed the way our world has been operating! When Jaya was in the US for her MS, 1980-8;  talking to each other on phone, needed a lot of coordination. We did not have phone at home. So, she would write to me the timing when she would call, that too at someone else’s place. If we were lucky she could get through after ½ hour delay! By next year, I am told that cell phones can be used during the flights too!  That is game changer!

In IC engine cars, the Engine has been the heart for more than 100 years, and car performances have been defined by the quality of the engine! Then the quality of the overall car is said to be better when the exhaust system and engine jointly released least amount of pollutants. Of course, now exhaust parameters are mandatory world over. By 2023 these parameters will be so tough that company like Volvo has already declared that they have decided not to develop any new diesel engines post 2023, as development of the same will not be cost effective! Plus, cities and countries are slowly banning diesel cars to be driven within their boundaries.

The drive train today, is placed physically in between tyres, from front bumper to rear exhaust system! This whole drive train is being replaced in EV’s, (as shown in pictures above) so what will decide the quality of EV’s? What is the Engine for EV’s? The Motors, the electronic controllers, battery pack, inverter and  gear. So, the car which travels more distance per charge, which accelerates faster will be a better car, all are zero emission cars anyway! No, it is not that simple! This is just the beginning of the car revolution! The batteries will have better charge storage per unit area, they may cost lesser and lesser over a period of time but this becomes  commercial aspect. To me battery packs are petrol tanks! Better battery only increases the capacity of the “new petrol tank” and distance traveled per charge!

Major parts in the new drive train for cars are going to be the software and the sensors that are going to be there in a car, besides the battery pack, motors and ECU’s. Around 2010, some vehicles had software with about 10 million lines of codes! In 2016 it is supposed to have increased by 15 times to about 150 million lines of code! The software is related to car autonomy, safety and infotainment related codes. But this is going to change even more drastically over period. The whole system might become  a computer in the car! The car recalls will not be because of faulty clutch or a gear box it will be because of software glitches and sensors!

The cost of software currently in large cars can be about 10% of the Bill of Materials but is likely go up in next 10/12 years to 30%! So, this is going to be the first game changer. What happens to current vendors of engine parts? As the population of EV’s starts increasing, the population of new IC engine cars is going to come down! Instead of one set of vendors, who make drive train parts, new set of vendors from IT industry and electronic industry will take over! So, need for physical RM will start getting replaced by “products” which cannot be seen by naked eye! Players who are currently tier 2 or tier 3 vendors may start becoming tier 1 vendors. At the same time car manufacturers may stand on the toes of Operating system vendors so that they can control the distinct facilities they can offer. This cannibalization is already being observed in case of battery manufacture! Vehicle manufacturers themselves are producing battery packs now. In IC engine cars, batteries have a small functional role whereas in EV’s it is going to be the new “Petrol”! OPEC, I am sure is already having sleepless nights or nightmares!

It looks like software will follow the path of infotainment innovations, autonomous driving capabilities, intelligent safety devices which will be able to work even if some part of software fails! The software will integrate with hardware in the form of sensors! This my friends, is going to be future drive train! The whole system over a period will be of increasing complexity which will need newer and newer algorithms and will generate such a huge data that all the data generated from these cars will have to be stored to cloud! One important aspect of new drive train is temperatures; these are almost at room temperature compared to IC engine cars where exhaust temperatures can go upto 600 deg c! This normal temperature in “New Engine” will allow usage of lot of electronics, sensors, software and ECU’s.

What do we foresee? Basic car with body, trim, seats etc which will keep on changing as is happening now. But it is the “New Engine” in the form of sensors, software, ECU’s and cloud computing that will change the car and make it a different beast than what we see today!

First and foremost will be the infotainment area which will have full connectivity with our single “communicator” which is currently our cell phone! It will have all these functions plus, music, internet hookup, reverse drive screen, automatic parking capabilities. This will use cameras in place of mirrors and it will also be the GPS display screen! What new functionalities will be added is anybody’s guess! Next consolidation will be ECU’s. Currently, there are 8 to 10 of them per car. These will be consolidated over a period, to one or two ECU’s which will handle all functionalities . The “real engine” will be controlled through these ECU’s along with other systems like wipers, window regulators, AC’s and so on. Next important aspect is, each vehicle will generate so much data that storing the same can be an issue. So, all this data will be transferred to cloud. This data can be used for analysis, diagnostics, on improving performance of the vehicle. This will be real life data and give the car makers real life continuous flow of information; product improvement cycles will be much shorter! In most cases in future, product errors will be related more to sensors and software. Software errors can be updated easily by releasing patches to all concerned cars as these cars will always be connected!

Another game changer will be what is going to happen to car service industry! Cars will go to workshops only for sheet metal work! Or small odd jobs! This will also affect vehicle manufacturer’s spare part sales; we know that drive train component manufacturers, will go down over a period! These components will exist only for old cars as no new cars will not need their products!

Another new area that will come up is third party software products! We really don’t know what these products are going to be! Most of the products will be available for passengers, as the driver naturally cannot use them while driving. Oh, I forgot we will have driverless cars at some stage, then all are going to be passengers. So, possibilities are simply unlimited!

I could write on and on and on! Let us wait and watch; there have been car racing games for computers. But now you will be having computers which drive real life cars on real roads! That too on their own! As a game changer or major disruptor of business, it’s a great thing for humanity. But for those who are in business of making current drive train components, it’s going to be a nightmare. As my friend had rightly said during a discussion, “I am ok with this change because it is for my next generation to handle this and not me because real inflexion point could be 2030, by that time I will retire!”