The Speed of Innovation
That was a humbling experience: Tesla announcing the availability of their self-driving car with a simple software upgrade. Not just because it was such an innovative accomplishment, but because I denied the possibility of it until very recently. In fact, just a few months ago I argued that the regulatory requirements around the self-driving automobile would be so strong, that it would take a long time before it would get implemented. My first thoughts were that insurance firms would make it impossible or at least very difficult to have cars driving autonomously and regulators would not know how fast they should stop it.
Limited rate of innovation
Looking at the developments in aerospace, thankfully one of the most regulated industries; it is interesting to see that the rate of innovation seems to be limited. For example, take a look at the Boeing 747 when it was first introduced in 1969 and see at how it looks today. I strongly believe this is due to regulation limiting the possibilities to introduce something radically different.
Innovation will be impossible to stop
My original thinking was that similarly the innovation of self-driving vehicles would be slowed by regulators pushing back on it strongly. How wrong was I?! Not that I was against it, far from it, but I believed that the push back would be a lot stronger. It is great to see that innovation was stronger than regulation. Of course, this is not yet the end of the discussion, but the innovation is here, on our public roads today. Of course, some are still pushing back, and the first nasty accidents will perhaps change the perception. But in the long run, innovation will be impossible to stop and regulation can only slow this down.
In this respect, it is interesting to see the graph below. Most GRC companies and GRC professionals tend to speak about the ever-growing amount of regulations. In reality, the amount of newly introduced regulations shows a clear declining trend.
Source, US Government
The above graph is good news for innovation. Of course, we need to be a little bit careful, but the graph is merely about numbers and not about the content of the regulation. If regulators pay attention to introducing the right regulations, the speed of innovation will continue to stay as high as it has been in the last few decades. What a great prospect for most! But what a threat for some!
To learn more watch the webinar: "Get in control of regulatory changes in your GRC environment.