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May 31, 2022 25 mins

It took a pandemic to highlight our dependence on transportation and logistics—but efforts to optimize the industry were gaining traction well before that. Today, the auto industry is in a state of complete disruption with technologies such as 5G connectivity, AI, and Machine Learning enabling smart vehicles, their manufacturers, and the smart cities they operate in and drive through.

To hear more about how these industries are being revolutionized, we sit with Lutz Beck, CIO of Daimler Truck North America, whose belief is that in a world where technology will inevitably be capable of everything, the only limit is ourselves and our abilities to think big. We’ll hear about his vision for the latest advances in autonomous vehicles and new connectivity-enabled services such as predictive maintenance, and how he is trying to change Daimler into a data-driven organization by using the company’s fleet of vehicles as digital assets.

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Speaker 1 (00:03):
We have quite a number of trucks connected globally, and
I think connectivity is also the door opener for what
we're doing in automatic driving, having this opportunity to real
time have the data of a truck, knowing what is
happening with the truck at any point of time, also
in safety situations, to make sure that you have the

(00:26):
right data there in other situations as well in case
of service events on the truck. So this is really
exciting and full stuff, and connectivity is a big portion
of it. Just imagine. I mean, if you're able to
flash over the air, if you can set parramid ors
over the air. In the past, you would need to
go to a service station or to a dealer to

(00:48):
do all of that, and now you can suddenly do
that over the air. What a difference. Welcome to the
restless ones. I'm Jonathan Strickland. As you may know, I've
spent the last fifteen years covering technology and learning how
it works, demystifying everything from massive parallel processing to advanced
robotics and everything in between. Yet it's the conversations with

(01:14):
some of the most forward thinking leaders, those at the
intersection of technology and business that fascinate me the most.
I was very excited to speak with Loots back. I
have long seen the automotive industry as being a sort
of loadstone for technology. Some technological advancements can go unnoticed

(01:36):
even as they change how we work and live. But
with the automotive industry, changes can be much more obvious.
They can be tactile. We understand them because we have
a history with vehicles. That's what made me really excited
to speak with Loots. I wanted to know more about

(01:58):
how in the current era of automotive industry, our vehicles
have transformed. They're no longer purely mechanical inventions. They are
a key component in the digital landscape. They are centered
to so many of the big topics in technology, data
collection and analysis, artificial intelligence, machine learning, and of course connectivity.

(02:25):
But before we jump into all of that, I really
wanted to hear how Lutz's career got its start. Lutz,
thank you so much for joining us on The Restless Ones.
We are so pleased to have you on the show. Yeah,
thank you also for the invitation. So I was wondering
if you could tell us a bit about how you

(02:45):
got started in the automotive industry. I was working for
quite some time in the consulting area, and as it is,
you're basically running a lot of projects. And I was
designed to the automobile Tift group, and then it was
dragging me into more and more of the automotive projects
in various functional areas, and then moved more and more

(03:09):
into the sales in the aftermarket area. And then Diamer
at that point of time said hey, why you're not
joining us? You would be good on our side, So
come join us and and be part of the company.
That's fantastic. Can you describe what it is you do
at Diamler What are your responsibilities there? So um ce

(03:30):
io of Diamnod Trucks North America. I'm running what we
call one segment of Diamonod Truck and Diamald Trucks North
America is actually the biggest segment with the highest volume
and biggest revenue and also the biggest abbit, so I
have quite a huge responsibility. And in parallel, I'm running

(03:51):
the autonomous activities of Diamod Truck. My team is working
on that for the global market. And then of course
certain responsibilities also in terms of what we call I
T strategy and I transformation specifically, when you're looking in
everything what we're doing now with the new technology, how
to change the I into what I would call a

(04:14):
driver of change for the company by using technology in
different ways. So I have that all a bit under
my umbrella. And as North America is one of the
driving markets and ahead a bit of other regions, so
we're setting also the pace for other regions where they
can follow and copy a lot of the topics which

(04:37):
we are doing here into their regions as well. I
find it endlessly fascinating that obviously I T has been
transformational across every industry, but in the automotive industry in particular.
I think for a lot of people it can start
to sound counterintuitive. They really associate vehicles with creations that
are mechanical, and they might think you might have I

(05:00):
T on the back end for things like sales or design,
R and D that kind of thing. But we've really
reached a point where our vehicles are also data collectors
and data generators, and that the analysis of that data
ends up being a key component in the industry itself.

(05:21):
Can you talk a bit about how important data collection
and data analysis is too, dime War's mission. It's interesting
that you're mentioning that because at the end of the day, yes,
everybody is looking to let me call it a truck
as a mechanical product. We from an I T point
of view, we are looking as a truck as a

(05:43):
digital asset. So for me, a truck is a digital
asset in the IoT world, in the world which we
are having now, which is producing, as you said, a
lot of data and which is connecting with a lot
of systems, a lot of different environments, ecosystems in the
whole space. And what we have in plan is basically

(06:06):
that we said with the data we are collecting, with
everything what we're doing on the analytic space, we want
to drive first of all to a data driven organization
and at the end of the day, their ultimate target
is from an I T point of view, to build
the intelligent company, which is using data as one of
the key assets to drive decision making. So what we're doing,

(06:29):
we're collecting more and more, we're using more and more.
Of course, we are filtering as well, because at the
end of the day, either you cannot use data due
to legal topics, or you you don't need to use
the data at all, and then you need to figure
out how you use the data, do the analytics on it.
I want to drive the organization to a data mindset

(06:50):
and also say, okay, how can we use data in
a completely different way, not just for decision making, but
also leveraging for new services which we are offering to
our stomers, to our dealers, and using data as as
a key key set to to generate revenue and profit
at the end of the day for the company as well.

(07:11):
It's mind boggling to me because I just think about
the amount of information a single vehicle might generate, and
then you extrapolate that across an entire fleet of vehicles.
As you say, one of the big challenges there ends
up being determining what points of information are going to
be relevant and useful to you and being able to

(07:33):
narrow that focus in and to find the signal amongst
all the noise. So your discussion of turning Daimler into
this information oriented and information driven company really resonates with me.
You also mentioned that you are leading efforts in the
realm of autonomy and autonomous driving. Can you talk a

(07:55):
little bit about the components that are really necessary in
order to make a truly autonomous vehicle a reality. I
do believe there is a huge, huge opportunity specifically for
the trucking industry making that a reality, and it's public
knowledge that we are we're working on that with partners,

(08:16):
collaboration with way more on the topic as well that
we have Torque as a company here as well. So
I mean, for me, this is some kind of the
future and definitely needed. There is still a way to go,
but I think it's very very exciting and the way
you can do things nowadays. As you just mentioned, when
we are coming from this age of business intelligence at

(08:40):
a certain point of time, and this was evolving more
and more, not just from a reporting into analytics, and
now it's basically driving, artificial intelligence, machine learning, all these
topics which are helping us actually to realize this automated driving.
It was a very short time spent to develop all

(09:00):
of that and now you see even further dynamics in
the evolution of the technology which are helping. So I'm
really excited about that for me, you know, I mean,
at the end of the day, automotive industry is actually
the place to be at the moment because there is
so much of changes, There is so much of disruption
specifically on the technology space, and we see that there

(09:23):
is so much energy also on the team's working on
that one. I'm always happy going down there to our
test trick and sitting in one of the autonomous trucks
and and just let it run. When you have that
on the street at a certain point, I think it
was a big achievement for the industry in total. If
this is realized, then I have to say Lud's I
am envious of the experience of being able to sit

(09:46):
in one of those test vehicles because I've been covering
autonomous driving technologies for a while now, but I have
actually never been in one of those vehicles. I've been
in vehicles that have had advanced driver assess features that
start to approach maybe it's like a level to autonomy.

(10:07):
If we're thinking about the classic five levels of autonomous driving.
How does connectivity play a part in Daimler's strategy. What
does connectivity make possible? We have quite a number of
trucks connected globally, and I think connectivity is also the
door opener for what we're doing in automatic driving. Having

(10:29):
this opportunity to real time have the data of a truck,
knowing what is happening with the truck at any point
of time, also in safety situations, to make sure that
you have the right data there in other situations as
well in case of service events on the truck. So
this is really exciting and cool stuff and we're running

(10:51):
that since years now, and we have partnerships in this
area as well. But from my point of view, you know,
having this connection, having this data available real time, being
able to do analytics, seeing also what is happening driving
decisions like service events, to make sure is that the
service now, is that the service soon event? And of

(11:13):
course based on what we're gathering on data, we even
try to do build more services and see how can
we improve even more because our target is at the
end of the day to have twenty four hours up
time for our customers for our fleets, which is securing
the business on their side, and connectivity is a big
portion of it. Just imagine, I mean, if you're able

(11:34):
to flash over the air, if you can set parramid
ors over the air, where in the past you would
need to go to a service station or to a
dealer to do all of that, and now you can
suddenly do that over the air. What a difference taking
a few minutes. And this is all available now. And
now the combination because we are combining that when you're

(11:55):
looking into what we call case connectivity, automated service and immobility,
this is all coming together. This is the technology, this
is the future, and this is the future of trucking.
And of course it's also a big learning still every
single day. Now it's a big learning because we are
gathering so much of data and you can do so much,

(12:16):
can do predictive maintenance, you can do other topics, and
this is so much of value where we would never
have fought off that we can do that. So that's
the reason why I'm always saying to my team, you know,
there is no limit anymore. Technology will be able to
do everything. The only limit is ourselves if we don't dream,
if we don't think that we can achieve it. I

(12:38):
love the thought the limit does not exist. A powerful statement, indeed,
and I really think that that's an incredible value proposition
to customers to being able to anticipate things before they
escalate to becoming a problem. Having that and giving the
information to customers so that they are more efficient they

(12:59):
have reduced costs. I think that this expands beyond the
automotive industry when we start to think about any company
that provides services, the ability to anticipate is becoming an
absolute key component to business strategy. That this is part
of what you get when you are buying into that

(13:20):
company's ecosystem. The value can't be overstated. I think nobody
can really go out of this anymore because at the end,
you know you're you're creating more and more. As you said,
also this ecosystem, you're in part of the ecosystem. But
just imagine having not just two trucks connected, having traffic
lights connected, having other things connected. The way how we

(13:43):
could optimize certain things, how we could use certain things
in a complete different way. One thing we love to
talk about on this show is five G and it's impact.
And I'm curious, how is Daimler taking advantage of five
G technology with you know, it's high bandwidthin low latency abilities.
How are you incorporating this technology or or treating this

(14:06):
technology in terms of your business strategy. First of all,
we are using it, of course, and it's helping us,
especially when we're talking about connectivity and automatic driving. But
now just imagine, you know, if we're looking at USA
and if you look at the coverage of five G
there is of course a lot of focus on the

(14:29):
areas with high population density. Right now, trucking is going
across the whole country. Just imagine if I would have
a full coverage of everything, what the opportunity would be.
So of course we are using it and we're happy
that we have it available. Conventional thinkings as businesses can't

(14:52):
get ready to deploy nationwide five G today. I want
the world, But T Mobile offers the largest fastest five
G network in America, would nearly four times the five
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Getting the five G network you need where you need it.
That's unconventional thinking from T Mobile for business. That's just
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(15:12):
analysis by ula of speed test intelligence data fived dowload
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mobile dot com. Well out of curiosity, we've talked a
lot about, you know, autonomous driving. Do you anticipate a
future where things like smart infrastructure. We kind of touched

(15:35):
on this with the smart like traffic lights, for example.
But you know, we're looking at areas such as up
in Michigan where they're building out a smart roadway between
I think Detroit and Arbor. Then are you anticipating a
time where we have smart infrastructure that's in potentially constant
communication with autonomous vehicles, or maybe a system where autonomous

(15:58):
vehicles are in communication with one other. I think a
lot of people are looking at autonomous driving and thinking
of them is almost like self contained computer systems. I'm
curious if you think of it as the future is
going to be more like a network and less like
a bunch of independent little islands that are all autonomous.
I'm a big believer in the smart cities concept. Just

(16:20):
imagine you're driving with your car on the highway. You
have the exit into the city, you give basically you
were giving your destination, and then as soon as you
drive off the highway, there is an invisible hand taking
over and leading you in the shortest time to your

(16:44):
destination because there is all this traffic information. For me,
this is not that far off. I think it's possible,
and we will have that at a certain point, and
we will have smart city concepts with the transportation. I
do believe with everything we we do in technology, there
will be a time where we will be able to
see all of that. I love that vision because I

(17:06):
love the thought of interconnected systems that improve efficiencies in
ways that are completely apparent. I think a lot of
what we're seeing now with automation, artificial intelligence, machine learning,
we're seeing a lot of processes being smoothed out, but
it's not necessarily obvious to the average person. When you're

(17:27):
talking about something like a system that gets people to
where they need to be smoothly, that it starts to
reduce or perhaps even eliminate things like traffic congestion, you
see this ripple effect that has a benefit that is
obvious to everyone. Having a system where it affects something

(17:48):
that is as universal as transportation, I think that's going
to be an undeniable big win for a I. Automation
and machine learning. When I was growing up, you know,
I was still carrying a map of a city. Nowadays,
you have Google Maps or whatever. You have your smartphone

(18:08):
and everything is on there, and it's even more accurate
than a map which was outdated if you had an
old one and whatever. So for me, we are dealing
with it every single day. We are working with every
single day, and we just advancing basically every single day
on something. So it's not more notable as big chump

(18:30):
as it was when we had suddenly coming to the smartphones.
But there will be another chump, like you said, with
the automatic driving and the smart city concept and this
whole connected ecosystems, there will be another big chump. And
you look in the past, in a lot of ways,
technology was a bit a limiting factor, And the only

(18:52):
thing is we need to look at how we applying
that all, how we can use that, how we can
generate the value out of it. This is also a
bit of a shift because I'm not more looking into okay,
I cannot do it because I do not have the technology.
Now I'm looking into it, Okay, what kind of skills
I need, what kind of people I need, what kind

(19:13):
of processes I need in order to realize that with
the technology which is existing. You also mentioned earlier about
looking at information technology in the automotive industry in the
different ways that can deliver value, including ways of creating
new revenue streams. Can you give us a few use

(19:34):
cases of revenue streams that are possible because of the
evolution of it within the automotive industry. I mean, if
you look at it right, I mean, connectivity is a
good thing. I mean there is a collection of data.
There is analytics which you can build based on the data.
When using data we know, all of us know. Now

(19:55):
you have to consider what is the privacy laws, what
is other regular aations which are coming into play here.
But at the end, you know, a predictive maintenance service
is a service which you can offer. You can say, hey,
I'm working with my customers on that, and this is
giving them a value because there's giving them valuable insights

(20:15):
for their topics. Or when you're having a data available
and you're using this data for fleet services, route optimization,
something like that is could be a valuable service as well.
There is other ideas of course as well, which are
built basically on the foundation of the data. And on

(20:36):
this foundation there is a lot of companies building another
applications on top of it or apps on top of it,
and that's something where we where we need to look
into it because I mean, just imagine again, I mean
the value having the truck running twenty four hours without
any problem, rather than having the truck for two or

(20:57):
three hours somewhere in a service station is incredible. So
you bring the downtime of the truck. Actually you you
minimize and this is something we need to look at.
And there is enough customers out there they say, hey,
this is so valuable for me. I subscribe to this
kind of services. I couldn't let LUTs go without asking

(21:19):
one more thing. Is there anything you would like to
add or share about Daimler that we have not covered today?
I mean, the the only thing I can say, right,
I mean you mentioned that before. I mean, the automotive
industry is in a complete disruption at the moment. There

(21:40):
is so much of things ongoing, There is so much
of topics there. I can just say. You know, from
my point of view, it's one of the coolest industry
you can be in at the moment when you're working
with technology, because there is so much of opportunities to
use and to learn specifically also for when you're coming
from college or whatever. Were right, So I do believe,

(22:02):
you know, automotive is at the moment in a complete change.
Also with this connectivity with automated with immobility. You know,
I'm working in this industry now for a very long time,
and it was always very interesting. It was always a
lot of changes, there was always a lot of topics coming.
But I never had this kind of exciting time in

(22:25):
the company, just due to the fact that we are
actually really changing completely and everything that we're doing on
the immobility, everything what we're doing on automotive, automated, and
also on the on the connectivity space further on. Right,
it's just a blast where you go to the office

(22:45):
or you go to work, because it's not necessarily only
in the office is wherever, but you go to work
and you say, hey, this is something really really cool
what I'm doing here, and I want to experience more
because I just have all the opportunities to apply everything
what I what I know, and I'm learning every day

(23:06):
something new. Especially this is something where I'm where I'm
just saying, and we're happy as I'm not to continue
building and innovating and inventing solutions in all the spaces
we're in to look into that and being the company
we always were, right, I mean, at the end of
the day, we invented the automobile, and I think this

(23:27):
is a heritage we need to continue and and inventing
more and more things also for the future. Well, Luis,
thank you so much for joining us on the show.
It's been a real pleasure to have this conversation with you.
Thank you also, thank you very much, thanks once again

(23:49):
to loots Back for joining the show. It was I
opening to me to look beyond the consumer perspective of
how the automotive industry is undergoing digitization. And getting that
deeper appreciation of how data can transform not just a
business like Daimler, but Daimler's customers is really exciting. I

(24:11):
anticipate we'll see the learnings improved. Not just vehicles and
business strategies that will happen, but we're also going to
see it improve how cities work and how traffic works.
Things that we just accept are a specific way are
actually going to change, and the benefits we see from
those changes are going to be too many to list.

(24:34):
Please be sure to check out our future episodes of
The Restless Ones. Season three has already rocketed off to
an amazing start, and we aren't slowing down from here.
I'll see you then. Conventional thinking says you have to
pay more to get more. I want the world, but

(24:54):
team Obile for Business uses unconventional thinking to deliver premium
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