Consumer Electronics Association president urges aftermarket players to be ‘ninja warriors’

The nation’s and the world’s economy faces a lot of uncertainty. But American citizens, more than those of most other nations, have the resources to create a better economic future, largely on account of the country’s tradition of innovation. That was one of the key messages of Gary Shapiro, business author and the president and CEO of the Consumer Electronics Association, one of the two featured speakers at the Automotive Aftermarket Industry Association Town Hall Meeting.

Shapiro related a story that caused him to seriously consider what reasons he as an American has for hope for the future, given the general economic stagnation that has taken hold of the country since 2008. He was visiting China when one of his hosts told him China was moving forward while America was falling behind.

Shapiro readily admits that government spending is “out of control.” This is true for not just the U.S., but most countries. He noted there are three courses of action to correct this problem: 1) raise taxes, 2) cut spending, and 3) grow the economy. He then noted that it’s amazing that U.S. government officials are talking about the first two options and not the third, the option that he and many others believe would be the best solution.

“Growth comes from one thing and one thing alone, and that thing is innovation,” he said. “Our strategy should be focused on innovation.”

Shapiro said the U.S. has a history of innovation. “I believe we are exceptional,” he said.

He noted that most people who are living in America are from families who moved here from other countries to improve their lives. “We are always taught that doing something and creativity and growing is a positive thing,” he said. This is not true in many other countries.

America’s diversity is also an asset, he noted. He acknowledged that diversity causes disagreements, but oftentimes, disagreements lead to creative ideas and improvements.

In his visits to Asia, Shapiro said he observed that there is a lot of agreement among people when they get together in groups.

The U.S. does face challenges, he noted. U.S. students are behind other countries in math and science, which does not bode well for the country’s future. However, U.S. students are also taught to value  entrepreneurship. This is not valued in other countries, some of which view entrepreneurship as shameful. “We have a culture that encourages innovation,” he said.

The First Amendment is also an important facet of American culture. It allows for the expression of new ideas. “We create something and then we destroy it,” he said. This is known as “creative destruction.” “Our kids are taught to ask why or why not?”

Another asset in the U.S. is the quality of its universities. He noted that students from all over the world come to study at U.S. universities. He said Chinese officials encourage students to study in America because they want their students to design more patents.

Shapiro said his organization supports a campaign called the Innovation Movement that focuses on the  principle that the U.S. should be the most creative country in the world. One government policy he would like to see changed is that foreign students are not encouraged to stay in the U.S. after they graduate. He said this should be part of immigration reform.

“Every Internet company in the world is a U.S. company,” he noted, with the exception of companies that copy U.S. Internet companies.

Another U.S. asset is the quality of its health care. “The truth is we have the best health care system in the world if you’re sick.”

Shapiro said changes are needed in educational lending. He said too many people are lent money to pursue college degrees that don’t help them get jobs.

Another problem is the lawsuit climate. The U.S. is among the most litigious countries. He noted there are fewer lawsuits in the United Kingdom where plaintiffs are more likely to be required to cover defendants’ legal costs.

Labor issues also need to be addressed, he said. “You can’t be stymied by a union organization,”  he said.

Focusing on technology, Shapiro said connectivity is becoming more prevalent in many industries, including  the automotive industry. He said every item that can hold a charge will have an Internet address.

He said microelectromechanical systems – tiny sensors – will be in more automotive parts. This is known as nanotechnology.

He thinks driverless cars are going to happen in a big way. “Why would  you need to own a car when you could summon one?” he asked.

In concluding, he urged his listeners to become “ninja innovators.” He thinks business people should be more involved in public policy issues.

“I do care about my kids and the future of this country,” he said.

Kathleens Schmatz, president and CEO of AAIA, then took the stage and asked Shapiro his thoughts about data ownership. She noted that automotive industry is concerned about this because the emergence of connected cars raises this issue.

Shapiro did not have a clear answer on who should own the data in a person’s vehicle, but he did have a suggestion. He said Consumer Reports should rate carmakers on their level of data friendliness, both to consumers and to the aftermarket.

Schmatz then summarized lessons from Shapiro’s talk. “It’s our responsibility to be a ninja,” she said. “We have learned this diversity is a strength. We have learned the importance of free trade. Most of all, we are a significant contributor to innovation and it’s a great country. Have a terrific day two (of the expo) and be a ninja.”