As Self-Driving Technology Approaches, Bloomington-Normal Can Shape State Farm's Next 100 Years

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Bright Ideas is an exploratory editorial series from AdaptBN Founder Christian Prenzler. Throughout the series, we will explore innovative ideas to help Bloomington-Normal continue to grow and position itself as a leading economic engine in the Midwest. Christian is an expert on the emerging mobility sector, which includes self-driving vehicles, electric vehicles, and car-sharing. You can find Christian on Cheddar, a next-generation business news network, and on his podcast, NextMobility.

It’s no secret that Bloomington-Normal’s economy has been built on the massive growth of State Farm. Employing approximately 15,000 employees in Bloomington-Normal, it is the top contributor to the local economy and its growth over the past 90 years has allowed Bloomington-Normal to grow rapidly alongside it.

From the 1970s to 2010, Bloomington-Normal saw its population nearly double as State Farm continued to dominate the insurance space. This is no small feat; Peoria’s population fell by 10% over that same period. However, growth in Bloomington-Normal has slowed significantly in the last decade.

Throughout the 1990s State Farm added over 8,000 jobs in Bloomington-Normal, causing its population to rise by 19.8%. While no national company should be expected to continue growing its employee base in a single location, State Farm has keep its employee count in Bloomington-Normal close to 15,000 for nearly the last two decades.

Additionally, changes in strategy over the past ten years have caused the company to consolidate operations from dozens of regional offices to four main hubs: Bloomington-Normal, Atlanta, Phoenix, and Dallas.

This strategy didn’t hurt or help Bloomington-Normal but provided tremendous investments into the Atlanta, Phoenix, and Dallas economies. The combined investments from State Farm and its partners into the three hubs are well over $1B.

State Farm's Three New Hubs:

As State Farm nears its 100th birthday in 2022, it faces large challenges. Self-driving cars are the single largest threat to the near-century-old company’s core business, auto insurance. While it's unclear when full self-driving cars will be on the roads, Uber’s new CEO predicts the technology is less than 10-15 years away. If you ask other, more optimistic Silicon Valley CEOs such as Elon Musk, they would likely say the technology is just a few years away.

Being a private company, State Farm doesn’t share much information about its work on this front. The company undoubtedly has a team of highly-qualified researchers working on understanding the technology but, unlike its other products, it faces an entirely new group of competitors: Silicon Valley. The large tech companies in the Valley move quickly, break rules, and have been developing the technology for over a decade.

It’s unclear how long State Farm has held a high interest in autonomous vehicles, but as we get closer to the real-world deployment of the technology, the company will need to define their role in an accident-proof future.

Companies like State Farm have recently shifted from slowly developing their own technology to purchasing startups and forging partnerships. General Motors purchased a startup for $1B and Ford has invested and partnered with several startups, including purchasing two last week. It’s also worth noting that State Farm is conducting research at the University of Michigan's "Mcity," a public-private partnership between the University and automotive-related companies.

State Farm’s Chris Mullen, Director of Technology Research and Strategic Resources, heads the research into potentially disruptive technologies such as self-driving vehicles. State Farm is part of Mcity’s Leadership Circle and was a founding partner for the group, contributing millions of dollars in resources.

Across town, the automotive startup, Rivian, is inching closer to beginning production at its factory in Normal. Between the researchers at State Farm and Rivian's growing autonomous driving development team (which includes industry leaders from Apple, Tesla, Ford and Faraday Future), Bloomington-Normal may have the exciting opportunity to become a test-bed for these new technologies.

What's Next?
Three things must happen to encourage the development of self-driving technology in Bloomington-Normal: Regulation, Investment, and Education.

Regulation

Both Bloomington and Normal need to work together to create clear, easy-to-follow regulations for self-driving development in the community. These regulations need to outline procedures for testing and create clear communication processes between companies and governmental entities.

Investment

To kick-start development and investment in Bloomington-Normal, community leaders need to encourage both State Farm and tech companies to build research facilities. Uptown Normal is a perfect location for a research facility. The proximity to Illinois State University’s campus and Uptown’s urban lifestyle makes it easier to recruit young, talented workers.

Education

Educational partnerships are incredibly important to developing innovative technology. Illinois State University is currently considering the addition of an engineering program, a move that would be a tremendous catalyst for attracting highly technical talent to the Bloomington-Normal area. An engineering program at ISU would open new doors for partnerships with both existing companies in the community and help in attracting new companies to the area.

Bloomington-Normal has the opportunity to capture the self-driving movement and help State Farm flourish for the next century. Our community's long-standing relationship with State Farm can help us all evolve together with a changing global economy.