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What are Ricardo’s core activities?
Ricardo provides mobility and environmental solutions to a global customer base, and in doing so our aim is to allow people to live in a more sustainable fashion. We are mainly focused on the transportation and related industries such as automotive and rail, but we serve also the energy space, water, air quality and governmental regulation sectors.
In your role as chief strategy officer, what are your key managerial responsibilities?
My key responsibility is to ensure that the company has a cohesive long-term strategy – over a 5-10-year time horizon – which maximises the differentiated service offerings we deliver in the various market sectors in which we’re engaged. My role encompasses our mergers and acquisitions activity and both technical and business innovation, and also looks at how we are transforming our operating capabilities for the long term. By addressing these issues, we will be able to run our business such that it is fit, agile and appropriate for the future. Digitalisation is of crucial importance and will affect almost every aspect of our business, from data analytics to virtual product development and virtual consulting.
What is the current condition of the market?
The automotive sector in particular is affected by the emergence of disruptive technologies in the form of connected and electrified vehicles and autonomous transportation. They offer both an opportunity and a threat for us. Sales volumes are going down for many manufacturers who are having at the same time to engage in aggressive cost-saving measures to fund new product and technology development that will help assure their survival in a rapidly changing market.
How does the UK’s current relationship with the EU affect your market?
There is a significant amount of political uncertainty across all the sectors we operate in. Brexit is just part of this, and operationally it is likely to affect our consulting-based business model less than it might a predominantly manufacturing or trading one. Ricardo already operates across many parts of the EU as well as the rest of the world, and we can manage our operations accordingly. However, the uncertainty that affects the market as a result of Brexit and other political disruptors can have a negative influence. The gathering trade wars between the US and China, the growth of isolationism and implementation of sanctions in many parts of the world are all unhelpful.
What are the long-term trends for your business?
We’re moving as a society from the stage of environmental awareness to a growing recognition of the need for net-zero carbon. Again, this is an opportunity and a threat. There’s clear pressure on governments and industries to do something, which plays to our strengths as a consultant. But, as the timing and the answers are uncertain, there is a stalling effect on demand because no one wants to make a mis-step in terms of their strategy or implementation. This affects both governments and industrial supply chains, and the extent of uncertainty is compounded by the multiple levels at which the rules are set: from international and national regulators down to state or even city jurisdictions.
What do you think has changed most in your industry in the past five years?
First, the escalation of concerns for air quality and environmental protection – from scientific debate to headline news, to tangible pressure for action on governments – has accelerated from urgency to emergency. Second, electrification and connectivity in the automotive sector have become core to each manufacturer’s strategic product plans, not just for passenger cars but pretty much all transportation sectors. Third, the rise in computing capability for intelligent, faster and more cost-effective solutions. Finally, and in a slightly different category, the growth of the Chinese market, where there is a desire to grow to become world leaders across a range of sectors in which our business is active. This will drive our business in these same sectors over the next 10 to 15 years.
How do you think management styles and strategies are evolving today?
Our current management style is particularly focused on understanding the key drivers for the millennial and gen-Z generations, which now represent around 50% of the workforce. Their outlook tends to be very different from previous generations. Expectations are for a more open management style with much more transparent communication and more immediate feedback loops to staff.
We see a breaking down of the work-life divide and are seeking to provide greater flexibility of working environment and work location. This can benefit the employee and the employer too, as we see better engagement of staff outside traditional working hours. This improved flexibility can extend even to sabbatical years, enabling people to travel or fulfil other life goals in the knowledge that their role in the business is secure – and with the business secure in the knowledge that it will retain a more motivated and committed staff.
What is the biggest opportunity globally for you at the moment?
The convergence of environmental, technological and consumer demands for a more sustainable world. All of these were seen in silos historically but are now converging. The solutions for each sector will be different, but the world needs some relevant answers. Technology is advancing in a manner that can deliver these answers more quickly, and people are demanding action. These three things are coming together much more forcibly than in previous years, and it provides a big opportunity for us.
What will your organisation look like in 10 years’ time?
We will still be a highly people- and technology-focused solution provider. The way we do this will be transformed completely into one that provides a more digitally-based solution service, based much more around recurring revenues from the provision of toolsets and the intelligence of a flexible workforce comprising highly experienced and skilled professionals.
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