Daimler Brochure 2018

CONNECTIVITY IN THE commercial vehicle industry I N A S S O C I AT I O N W I T H

Integrating data, boosting

connectivity Written by Catherine Sturman Produced by Kiron Chavda

Chief Information Officer Lutz Beck discusses how Daimler Trucks Asia is working to drive connectivity across the commercial vehicle industry and to transform it into a data driven organisation

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ousing an envied and world-class reputation, Daimler Trucks Asia (DTA) has cemented its presence as a leader in manufacturing and transportation.

An integral subsidiary of manufacturer Daimler AG, the organisation has worked to transform its existing business model and diversify its portfolio, developing new products and services to sell to its customers in an ever-growing industry.

However, in order for this to happen, its core vision has remained clear – to drive connectivity.

“At DTA, we want to lead the commercial vehicle industry into the future and be number one in quality, innovation, customer satisfaction and places to work. We want to connect everything,” explains Chief Information Officer Lutz Beck.

“Our transformation is ongoing on an organisational level, but we are in the midst of a cultural change as well.”

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Lutz Beck

Chief Information Officer

Lutz Beck, currently CIO for Daimler Trucks Asia / Mitsubishi FUSO Truck & Bus, is a business savvy, and result driven Senior Executive with extensive international leadership experience and a can-do attitude. A problem solver, analytical thinker and pioneer able to manage critical and complex transformations with an innovative approach to get the job done. He has benchmarking experience working in large multinational companies in the automotive industry and led and motivated large global teams to achieve target outcomes. Beck is global and a leading key player having worked across multiple regions and cultures in the fields of digital strategy and transformation, business process re-engineering and improvement, project and program management, SAP template implementation, system landscape renewal and innovation technology management. A true expert on the international scene and digital forefront, motivating and a sensational leader pushing those around him to new heights.

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A DEEPER PERSPECTIVE.

For DTA to be able to achieve its vision of leading the commercial vehicle industry through the power of data, disruption is not only inevitable, it’s mandatory. “We need to use all the technologies and innovations available to redefine our business model,” DTA CIO Beck notes.

“We have to be a disruptor in the industry and disrupt our own company to prepare it for the future.”

The road less travelled.

Quality management steps into the spotlight.

80% of these recalls could have been detected in advance based on the historical data patterns.

That disruption began in an unlikely place, one that wasn’t well known for its innovation - quality management. Its department head Michael Moebius admits that what it lacked in futureforward thinking, it made up for in data. Data filters through quality management from over 150 countries, but its conventional analysis system was outdated and relied on siloed internal sources captured through traditional means.

As a result, quality and safety issue identification and investigation times were reactive, and focused on historical analysis after the problems had already matured. This long and sometimes inaccurate process yielded high warranty costs and delayed recalls.

Solidifying a futureforward foundation.

While the quality management department had access to a wealth of data, it didn’t necessarily know how to analyse it most efficiently. Beck confirms: “We were collecting data, but not using it in a way in which you could make decisions or create business models out of it.”

This gap in skills highlighted a key area of attention for Beck, who believes that the foundation for everything within a company is its people. It was this desire to lay the correct foundation for DTA’s digital transformation that led to the relationship with Deloitte. Ashwin Patil, Deloitte Consulting LLP Managing Director for Global Manufacturing Analytics, remembers: “We were able to gather folks from strategy, cloud, digital tech, data scientists—we brought key people to the table to help drive this.”

The power of collaboration First, Deloitte analysed all of the available data from 45 of the last major DTA recalls. This included structured data like metrics correlated with its vehicles to unstructured data, such as call centre records, warranty claims, dealer and technician comments and social media engagement. Based on this combined analysis, Deloitte discovered that

The opportunity to look even further into the future became possible with the introduction of live data through DTA’s launch of Fuso Super Great, its first connected truck and foray into the internet of things (IoT). As the truck is driving, geographical data and data from the vehicle’s system like oil pressure, coolant temperature and battery voltage is combined with the historical data, providing DTA with the insight to see the overall health situation of a truck. According to Moebius, this proprietary cognitive system, dubbed “proactive sensing”, enables DTA to implement “predictive intelligent maintenance and service planning, which ultimately helps us get ahead”.

The success of Daimler Trucks Asia and Deloitte’s proactive sensing project hinged on the teams’ desire to function as an innovative client relationship. They embraced the “flavor of a startup”, where constructive criticism flowed freely, enhanced by regular meetings at the staff and management levels to create an open environment for questions and ideas. Deloitte also took a second look at DTA’s internal resources and developed skill profiles to identify gaps in capabilities.

Smarter insights, stronger outcomes.

The proactive sensing project is expected to save DTA $8mn in warranty costs during the first 24 months and even more in recall costs. The system is also able to predict and prioritise quality issues 13 months ahead of its previous process, which helps keep customers on the road with less downtime.

“By doing this project, we were able to generate awareness for data at a management level,” Beck states. “The project helped us shape an overall business case for the big data topic. Now everyone wants to have it.

The whole company is pushing for it.”

The journey for DTA doesn’t stop here, however. The constant cycle of disruption continues, not only for the organisation and the industry, but also for the ever-changing world that is becoming increasingly reliant on connectivity, data and the internet of things.

avasudevan@tohmatsu.co.jp | Ajai Vasudevan,

Director Automotive, Deloitte Tohmatsu Consulting

DAIMLER AG

Connected X Driven by its senior leaders, DTA’s digital strategy, Connected X, has seen the organisation overhaul its outdated infrastructure and application landscape. By deconstructing its back-end and legacy systems, DTA has rebuilt its internal processes through the use of new technologies, enabling it to move into an increasingly digital world based on a new digital foundation.

“By transforming into a datadriven organisation, the key aspects will be how we work with data and how we understand the data,” observes Beck. “Integrating all data is also in accordance with our

overall Daimler Truck Asia strategy.

“We defined our Connected X strategy based on three pillars – product, process, people – in a bid to drive Daimler Trucks Asia towards a data driven organisation and connect everything by fully utilising the Internet of Things (IoT),” he continues. “We needed to work on core elements such as digital products and services, data driven and modern methods and skill sets.

(Right) Daimler’s new, smart E-FUSO Vision One model

“By transforming into a data-driven organisation, the key aspects will be how we work with data and how we understand the data” – Lutz Beck - Chief Information Officer

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TECHNOLOGY

“On the product side we are focusing on improving new as well as existing production sites and vehicles by digital enabling them.

On the process side, we work on efficiencies through automation and robotics. On the people side, we

Data-driven technologies The need to collect and enhance all data has been essential throughout DTA’s aim to enable the business units to perform data driven decision-making and innovations. The combination of Truck

VIDEO: Deloitte Client Spotlight Daimler Trucks Asia

started to train, renew and scale up the team, bringing a combination of traditional IT skills and new digital skills which are required to run such complex transformations.

“There are not many companies in our industry that are doing this in such a way, so we have become a frontrunner in terms of digitalisation.”

connectivity and analytics helped the organisation in quality management (QM) processes to unlock saving potentials and business value.

By collaborating with Microsoft and Deloitte, DTA has integrated its internal data, as well as its external data received from both its sites and connected trucks. The ability to gain

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By collaborating with Microsoft and Deloitte, DTA has integrated its internal data, as well as its external data received from both its sites and connected trucks

VIDEO: Cognitive Technology in the real world of Daimler Trucks Asia

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real-time data has therefore enabled the development of new solutions and delivered significant cost savings across the board.

“There is nothing which we are doing which is not giving us either internal benefits or new business opportunities,” adds Beck.

“I do not have cases where we do not have savings or additional revenue streams achieved by introducing new technology.”

One key example is the development of DTA’s proactive sensing analytics.

Built in partnership with Deloitte, the two companies analysed a large number of QM information surrounding the health of DTA’s trucks. Through this, the companies found a number of patterns in the high volume of data received, paving the way for a solution to be developed.

Through proactive sensing, DTA is now able to detect issues in advance, reducing downtime and increasing the safety of its vehicles through predictive intelligent maintenance.

“It doesn’t matter if you talk about big data, artificial intelligence, machine learning or deep learning, all these new ideas are helping us to be number one in quality, innovations and customer satisfaction while being more efficient and more cost-effective,” notes Beck.

To further solidify its position as a techleader in the commercial vehicles industry, w w w . d a i m l e r. c o m / e n

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Mitsubishi Fuso has also developed and launched the all-electric light-duty truck eCanter which is in seriesproduction since last year, as well as the concept heavy-duty truck, E-FUSO Vision One. Developed from feedback received from customers, the E-FUSO brand will open doors to the development of further connected, electric-powered vehicles across DTA’s fleet, and will also work to reduce emissions whilst strengthening its position in the market.

Experimental technologies Although the organisation has worked to invest in new technologies and extend its areas of innovation, the need to mitigate potential risks within its IT operations has never been more important. Enhancing its cybersecurity has therefore become a key focus within DTA’s digital strategy, and a team has been established to proactively manage security patterns across its manufacturing operations.

Interestingly, the organisation is also looking at other ways to transform its production capabilities through the

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increased use of new technologies (such as robotics) and defined the concept of the Factory of the Future based on Industry 4.0 principles.

“If I look at the production, we can use much more automation and robotics in the manufacturing space. We are on the way to connect wherever possible our robots in order to collect real-time data, and based on that take real time decisions on predictive maintenance and other topics,” explains Beck.

“Secondly, when we are looking into our office environment, there is a lot of automation and efficiency gains which are made possible by using robotics. Therefore, we are looking at how we can gain further efficiency in the office environment through the use of robotics and are looking at automating processes which today are paper-based.”

DTA is therefore undertaking increased experimental research in using robots for specific topics. For instance, it is also utilising famous Japanese robot Pepper to look at ways in which it can boost efficiencies.

“We defined our Connected X strategy based on three pillars – product, process, people – in a bid to drive Daimler Trucks Asia towards a data driven organization and connect everything by fully utilising the Internet of Things (IoT)” – Lutz Beck - Chief Information Officer w w w . d a i m l e r. c o m / e n

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“It doesn’t matter if you talk about bi artificial intelligence, machine learn deep learning, all these new ideas are us to be number one in quality, innov and customer satisfaction while b more efficient and more cost-effect – Lutz Beck - Chief Information Officer

ig data, ning or helping vations being tive�

CASE STUDY How Daimler Trucks Asia utilised data-driven insights to proactively change the course of the entire organisation

The power of collaboration By collaborating with Microsoft and Deloitte, DTA has integrated its internal data, as well as its external data received from both its sites and connected trucks

Proactive sensing technology has enabled DTA to detect potential issues up to a year in advance

The E-FUSO brand will open doors to the development of further connected, electricpowered vehicles across DTA’s fleet

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Competitive edge Through blending traditional ways of working with new ideas and technologies, DTA’s working culture and subsequent development and training of employees, has consequently undergone significant change.

“We are continuing to upscale our existing people in new technologies. This is an ongoing task which we do internally and with external support,” notes Beck.

“We also looked at the skillset in the market and employed people who had the required skill sets and brought them into the company. We have now built up skills on analytics, artificial intelligence and virtual and mixed reality. We are also taking on new people for our connectivity platform and for our connectivity for our trucks.”

It is clear that DTA will continue to disrupt the commercial vehicle industry, where it will seek to develop increasingly connected, tech-driven products and services for its customers. However, speed will remain essential in such a competitive space.

“This is a challenge, but we want to take that challenge and see how we can move forward and combine these elements with the new technologies coming in for our customers and for our organisation,” concludes Beck.

“We will need to see how we can further use technology to transform the organisation, our business model and how it will enable us to create new business services in the future.”

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Mitsubishi Fuso Truck & Bus 10, Ohkura-cho Nakahara-ku, Kawasaki, Kanagawa 211- 003 Japan

T +81443307077