Silicon Wadi Israel - Digitizing orient
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Transcript: English(auto-generated)
00:18
doing? Long day, huh? So I'll try to tell you a story and not just try to give a
00:25
regular dry presentation. I think because I just came back from Asia, from nine years in Asia to Israel, as my team says, you know, you're Israeli but maybe you're not as Israeli as you were before you left. So Asia changed me
00:42
and the international life changed me and I'm telling you this because I'm going to give you the perspectives of why Israel is considered such an innovative place and maybe what makes us as a country so innovative. And I'm telling you this because I think that there is no one place that has the
01:01
magic power. I think every country has its own strength, its own values and I think the beauty in a global village that we live in today is how to leverage all the markets and all the different talents that we have around the world. So I'm gonna talk to you today about what does it mean to be up
01:24
to tomorrow? Do you know who said that, being up to tomorrow? Probably not, I wouldn't have. Listen up, later you'll see who said that. That's not my sentence but I loved it. My boss is the head of digital vehicle and mobility at Daimler and when I presented to him this quote was in my
01:44
presentation and he said you know what I love this sentence because we always say we need to be up to date. Who says we need to be up to tomorrow? And I said okay that's great inspiration. It's an inspiration for our newly established tech center in Tel Aviv so it's a topic for my presentation. And
02:03
then there's another funky question here. Leadership without control. How can you lead if you don't have control? That's another thing I'd like to share with you through this presentation. So I'm gonna first start by telling you
02:20
how did Israel feel to me or some of my impressions coming back home after nine years abroad. So I met many people and they told me you know what Israel but not Israel Daimler is a great leader of innovation. We see a lot of innovation coming from Daimler. We feel that Daimler is not afraid of the
02:43
not invented here syndrome. Meaning we're okay to leverage the ecosystem and do innovation that is not exclusive. But I was asked towards what are you innovating? What will be your role in the new world? Will you be the
03:01
one that just delivers the metal the vehicles? Will you be the robo taxis the fleet managers? What will you be? So the answer I gave is do you know the role of OEMs in this big world or the new world? I'm not sure if we know but we have our case strategy. Case is identifying I think the top big trends
03:22
that are disrupting our industry. Connected, autonomous, shared and electric. And our company has put significant investments and focus in each one of those areas. And so hopefully by the time the future unveils itself we will have our hands already in all those different
03:45
dimensions. Because maybe the connected will be dialed up more. Maybe the shared, maybe both. So if we have our investments in the right place hopefully we will be ready for tomorrow. And another thing I said there's one thing we know for sure. We want to be close to our customer. So within our
04:03
strategy at Daimler we want to be close to our customers. And another statement I got when I was in Israel is Israel is very good taking things from zero to ten. But then you give it to the Germans they take it from ten to a hundred. And that's very true you know I came back to Israel
04:22
sometimes I say my god people have a salad in their heads. So many topics, so many things juggling in their heads. But that's how you spark innovation and that's where Israel is very strong. And then do you know the saying that if you watch how people drive on the road you know how they think? If you
04:42
think about it in different countries you drive in different ways and it's a mirror of the culture. So if I try to take that everything's possible. Rules are a recommendation only. And if there's a roadblock I'll find a way to to overcome it and improvise. And these are some reflections of how driving in
05:02
Israel is and how our culture is. By the way in Korea people used to say oh god driving in Korea is crazy but Koreans have a lot of things in common with Israel. So I was not so worried on the road in Korea. Another thing that caught me when I came back to Israel is I think I was on the phone in
05:23
Israel in less than six months more than I was on the entire time that I was in Asia altogether. In Asia people took email, people chat, less phone conversations. But here in Israel a significant amount of time is taken on
05:40
phones for me. And then it seems like everyone knows each other. I go to a meeting with a VC they told me oh we know you've been there last week and in another place two weeks before. So it's of course Israel is a small market but it's a very connected market. Everyone talks to each other all the time. That's
06:02
also part of what makes Israel so innovative. So we communicate all the time with each other. And there was one thing that I was thinking about. I said in many cultures rules are a safety net right. We refer to rules to make sure that our boundaries are clear. Rules are definitely not that safe
06:22
in Israel. So what is the safety net in Israel? I think it's the network. I think Israelis really rely on one another as a safety net. And that's also a very interesting comparison that I found for myself. And then when I was interviewing you know when you interview you interview right. Not in
06:45
Israel. In Israel half of the interview was me interviewing and half of the interview was me selling the job to the candidates. And they were asking as much questions or as many questions as I was asking them. And questions like how
07:00
do you define success? What is tangible deliverables for you in six months a year? When I told it to some of my colleagues at Daimler they said who's asking those questions? Are you asking the people? I said no they're asking me. So although it's for positions at Daimler such an amazing company and I love this company. Still they feel that they want to interview me and make
07:24
sure that if they want to come work for us it's the right company to work for them. And then they look at me. I put this in the presentation because it happens so often. People look at me and they say isn't Daimler a very conservative company? But we look in your eyes and we see the spark. So
07:41
there has to be something there. So it's interesting they look at how I be how not what I say but how I behave and what I have in my eyes to tell them what is the company. I can tell you I definitely have a spark in my eyes working for such an amazing company. It is amazing. And then some impressions
08:03
of one of my first employees. So this is employee number one. We're sitting together first day on the job. And you know three hours download. I give a download on Daimler on what we have to do together. And at the last 20 minutes he says is it okay if I also give you feedback? I'm
08:23
like sure. I really believe in a two-way street communication that goes both ways. Go ahead. And he pulls out a full page full of expectation management he has for me. So it's not just me giving my expectation management to the team. They're giving me their expectation management back. And then
08:42
another reflection. You know one of our managers joined the team and at the beginning he didn't have a Daimler address. And there was a very important email. That email was in his inbox coming from Germany saying dear Ola Kalenius our board member for R&D. You know we're giving this presentation
09:04
to the board of management next week. Do you have any comments? There were you know levels at you know at Daimler. Level two, level three, level fours on the emails. I didn't even have time to tell him how to respond to such an email. He got his email address. Five minutes later he already responded to the
09:23
email with a list this big of things he thinks should be included in this deck. And I'm like oh my god. You know there's level twos, level threes, level fours. The presentation is next week. It's already done. So you see the difference in Israel. Hierarchy is not so strong. I remember that when I moved
09:44
to Singapore after working for Daimler in Israel but it was more of an Israeli company. The sense of hierarchy at the time that I felt. I felt it. It was not something that someone told me. From then till today it's different. I think hierarchy is less felt at Daimler. Today you can approach a board
10:02
member and have a discussion. You really can. Where in the past you couldn't. It shows also a bit about the cultural change Daimler is going through but there is still hierarchy. More than we want maybe. But I really had to tell him well you know it's done a bit different. The reaction was actually good from the recipients. They were not intimidated and they went
10:22
along with it. And us, Daimler, going to Israel is not just about what we want to take out of Israel. It's also how can the interaction between different cultures and different ways of communicating and working can change also Daimler. So this is an example how an interaction between an Israeli
10:44
culture to a German culture can actually make both cultures better. So why did Mercedes Daimler decide to come to Israel? I think there was an introduction and yes Israel is one of the five top technology ecosystems in
11:01
the world and innovation is a very strong virtue that we have in Israel. You can see here that the World Economic Forum really ranks Israel among the highest in terms of innovation. Roland Berger did a very very strong study in Israel placing the smart mobility autonomous vehicles and other
11:21
technologies really in the center of innovation of Israel today. And there is also significant capital raised about 4.8 billion dollars only last year. Our founding fathers, he's the answer to the first question. So Ben-Gurion said the army for the army it's not enough to be up to date. You have to be up to
11:42
tomorrow. And this is now big inspiration for our new tech center in Tel Aviv. We need to be up to tomorrow when we need to contribute for Daimler to be up to tomorrow. And then Shimon Peres, our former president, said once that one of the greatest contribution of the Jewish history is
12:02
dissatisfaction. That's quite a funny statement, dissatisfaction. So let's look a little bit about the roots of Israel and the Jewish history. In our roots we have restlessness, we have adversity, we have curiosity, we have scarcity, drive, passion. I think these are some of the roots that we have that
12:24
drive innovation in our culture. In the army, look first of all on the ratios of soldiers to leaders. It's a nine to one. It's a relatively flat hierarchy. I think in the US if I'm not mistaken it's five to one. And also you know you are 18. I went to the army myself as well of course like
12:44
everyone in Israel which was one of the best times of my life. You're young, you're in charge, you're responsible. You many times take very very significant decisions. They need to be taken on the spot because many times there's absolutely no time. And you're given a framework but you're also
13:03
given freedom to improvise and freedom to put content into the topic or into the challenge. And I'm telling you this because I think the army and how it breeds people actually is a great facilitator for the startup ecosystem in
13:21
Israel. Sometimes the technologies there are extremely advanced so they come from the army with a mindset of not so much hierarchy of improvise, find solutions because there is no other way. We're a small country, we need to be safe and for that we need to be resourceful and we need to find
13:42
solutions. Maximizing resistance in order to be a game changer. Israel is challenging you. It's a very network you remember I told you it's very network oriented and people like talking and communicating and interacting but they're
14:02
challenging everything. That's who we are and we're encouraging disagreement asking questions and those things are also encouraging innovation. I think as a lessons learned of the second Lebanon war, Giora Island, he said something which is if you read it it's just amazing he said it's an officer's job to argue
14:25
with the chief of staff if he thinks he's wrong he should do it assertively on a basis of professional truth as he sees it. So in our culture we are encouraged to challenge our leaders. I remember you know because in Asia I was
14:43
the regional credit head for the region so I worked with twelve cultures in Korea it was Korea and I remember always when I work when I used to work with my teams abroad I used to say please challenge me it's okay to give me difficult feedback because that's the only way we can do the right thing if
15:00
we talk and we find the right solution. When I did this speech to my team in Tel Aviv they laughed at me because they don't need me to say that they would do it anyway if I want it or if I don't. Immigration Israel is the biggest melting pot in the world and it brings in two dimensions first of all if
15:21
you think about our parents or my parents generation most of them were not born in Israel they come from everywhere around the world you know we have Germany Poland Russia we have Ethiopia we have Morocco we have Iraq we have Iran many many many countries and it's really those are completely different perspectives coming to Israel. Our parents most of them had to leave
15:45
all their fortune when they came back so the sense it gives you is that you don't have what to lose you only have what to gain and that's part of the entrepreneurs spirit in Israel and the other element is the diversity because there are a lot of cultures and a lot of different ways of
16:02
interaction. Failure. I'm Israeli and I say here on the slides you have to accelerate a large number of failures in order to innovate but still as an Israeli I hate failing but it's still okay for me to fail you know there is
16:25
also Israeli literature and songs about failing. Failing is okay in Israel as long as you learn from it you step back on your feet and you find solutions. I went also you know I think in one of my IMD courses that I did
16:40
there was a statement there that I really like it's not what happens to you that defines you it's how you react to what happens to you that defines you and if you think about this in the context of failure if we failed okay let's stand with our chins up learn our lessons and move forward and create
17:02
a better future a different future and you know they say you know failure is a gift feedback is a gift it's difficult but it's true and in Israel I think you see the stress level and the survival that's true in Israel we have a very high stress level and we do need to survive and that sparks
17:22
entrepreneurship and and innovation and now I want to tell you a little bit about the research center that we have established in Tel Aviv. What is our vision? We want to be a magnet magnet for talent the best talent that Israel
17:42
can offer and we want to be a magnet for the best technologies that are out there to to harvest for our company. We want to be a strategic partner for cybersecurity for our amazing and intelligent cars. We want to harvest or incubate a digital mindset in our people you remember how I told you
18:01
about the discussions or the cooperation than the communication we have between Germany and Israel so that cultivates a mindset as well and we also want to have it to be a digital innovator what does that mean we want to support the implementation of benchmark technologies that can be meaningful
18:23
for the leadership of timer in the in the tech area for our cars. So where do we stand today we you see that we're still a very small team but very very strong we have a our new head of cooperation and innovation management sitting here we all everyone that we took is a pride and I think that's
18:46
also one of the things the team is telling me it was important for me and for us to really take the top talents that Israel can offer us so that we can be a strong team that lives team and amazing results together we also have
19:05
you'll see here he's a brigade general he's not an employee he's an expert that we hired he was the ex-CIO of the Israeli army and he's he's helping us with the tech leadership for for our company we have the
19:20
management team is in place we chose our offices over there you can see and and we really set up the KPIs so I think a I'll joined us two weeks ago or something the other managers also over the last two to three months so we're really ready to start producing this meaningful impact for Daimler so how do
19:43
we think Israel can support Daimler innovation as I said earlier in a few ways we're gonna have an R&D Center so we're gonna do development for digital vehicle we're also going to engage the startup ecosystem the technologies that those startups can bring to the company you know that we have maybe
20:02
you know that we have the startup Autobahn company we have a very good chunk of those companies coming from Israel with those innovations and we want to leverage the talent the culture and the mindset the timer has to offer Israel has to offer we want to do hackathons we want to join innovation program that maybe are not Daimler innovation program and we have
20:23
already in Israel we want to do research with universities but one thing is very important and you can see it over here the projects need to end up in our cars if they don't end up if this innovation doesn't end up in our cars we've done nothing and I think what's the challenge that we see and
20:41
what we want to take up and make a reality is really making sure that all those startups and all those research papers and all this R&D really can be implemented into the vehicles and provide the leadership for for Daimler so there are some questions I get which fortunately or unfortunately I
21:06
didn't find one answer for and many answers that I could give can be correct for example they asked me so tell me about the startup ecosystem in Israel are you going to buy startups I can say no actually if you buy a
21:25
startup which is very mature it already encompasses the opportunity or the potential to work with many OEMs and therefore the value in the market would be too high so no but you remember mobile I mobile I is a 15
21:41
billion dollar transaction that took place in the Israeli market where Intel bought mobile life for their autonomous vehicles they were big they have the potential already to work with multiple OEM but the answer was yes we will do it because it is strategic move for Intel so you see there is no right answer and then I get a question well will you invest in a startup maybe
22:05
you wouldn't buy the startup maybe you will invest in the startup here again I could say well why should I invest and the answer could be you know if you invest then you'll get the ability to influence the strategic
22:22
direction the startup is developing their products that's right you can also have how can I say leadership for six months you know for example if they start with us they will not work with any other startups for the next six months and it will give us a lead in the in the development so you can do
22:41
that if you invest correct yeah you could say that makes perfect sense but I can also counter that and say well but Daimler is so big most startups would want to work with us anyway so if they decide to work with us anyway they would want to listen to us so we will have the ability to influence
23:01
their strategic direction in any way they need to dedicate their resources so maybe we wouldn't have to have a agreement for a lead of six months because it will happen naturally and then I get questions like you're setting up an R&D where your people are gonna develop and on the other hand
23:23
you you're gonna go to startups isn't this a competition yes it is but it's also necessary and I also get questions shouldn't you develop the most important pillars of the futures on your own Daimler why go and play with the
23:45
ecosystem I could say absolutely right we want to have exclusive technologies right but I can also ask you but can we is the disruption manageable or do
24:00
we have to play with the ecosystem in order to be in the lead so you see I can look at every question in many many different direction and I think it symbolizes the generation or where we live today the disruption is amazing bringing me to the question leading without control the disruption is there
24:20
I came up with this sentence not because I thought about it theoretically but because I was actually when I came back to Israel there were so many startups so many VCS so many parties at Daimler and I said my god it's very difficult to have control over such a huge platform I still have to lead but
24:42
then I thought a bit and I said wait a minute but when you look at the world we work in it is like that as well the disruption is so significant we have to lead but we don't always have the control so up to tomorrow what is
25:03
my perspective of being up to tomorrow I think it's harvesting the best technologies out there for our company that are available today it's identifying the trends that are maybe not available today but in five to ten years down the road it's frenemies playing with your friends and enemies
25:22
because sometimes you need to do that and it's playing with the best and we have some good examples of doing that already at Daimler you know here our high-definition maps for autonomous vehicles we do it together with our traditional competition like BMW and Audi and Bosch we just partner this is
25:41
relatively new with Bosch for autonomous vehicles so Daimler wants to lead but sometimes we work with the best and with our frenemies for that let it come my first few months in Israel sometimes I felt like I'm walking in a
26:04
forest with my eyes closed I have to move ahead I have to find my way through my senses because I can't see so I have to really trust my instincts because the grounds have never been explored before but I think it's also
26:20
a very good illustration of the generation we live in now at Daimler and in the automotive world we don't always have all the answers we need to explore new territories in the new digital world and let it come I want to leave you with this last slide and you see the picture in the middle I
26:44
try to portray something that is modular I think to be successful in this world we need to be modular we need to be connected and we need to be able to say okay this is now the benchmark technology I take it I plug it in easily fast when it's no longer so updated I take it out and I bring in another
27:06
building block in and lead without control be up to tomorrow the power of we I really do not believe you can do think as an individual not an individual person not an individual organization we do it as a team we need
27:23
to have courage we need to do it fast we need to improvise and tell our bosses off when they're wrong thank you very much so questions yep yeah question
27:59
about the choice for Israel yeah it's a choice for Israel also a conscious
28:05
choice to start innovating outside of the the traditional car environment that Germany is right because I mean if you look at car innovation I wouldn't think of Israel right absolutely so did you actually move to Israel as a
28:24
conscious choice to stay outside of this environment to be able to innovate more freely we came to Israel you know the unit that we're belonging to is the digital vehicle Israel is very strong when it comes to digital and this is why we decided to come to Israel but there is the other element that
28:43
you just touched on when you need to innovate sometimes you need to do it a bit separate so it helps we always say now that we just established the team it's very important for us to be completely integrated into Daimler but at the same time we are a bit separated to let to innovate you need to have the
29:02
space to innovate so it's good that we're separate but that was not the reason why we did it we did it because digital is very strong and the Israel startup scene in Israel it all of it today is extremely smart mobility focused thank you very much short question all right a little bit
29:38
late so you might have said that in your talk how many startups in Israel
29:43
do succeed what's the percentage and which startups are successful how many startups in Israel succeed I think I'll turn over this question to a l so is
30:01
there any stratification so which can you say it's it's more internet industries to succeed whereas restaurants are not successful or can you say something about that a little bit more yeah the question is actually is there any stratification can you see what type of startups are successful
30:23
and which are not factors in Israeli startups is because the small the local market is tiny we're about a half million people most of the startups things globally from the get-go so everyone's thinking about selling to the u.s. to China to Europe in terms of technological trend it changes over
30:43
time depending on the technology a few years ago it was you know a big data so it really changes over time right now connected vehicles is one of the hottest areas but it would take us you know ten years to know the success factor so if you look at a venture capital usually you only know if a fund
31:02
that invested in startup is successful ten years from its inception so it really takes a long investment horizon to know if autonomous cars in transportation is going to be a successful sector so with your technology you need strong backup so correct yes much longer horizon than
31:21
you know an app from ten years ago thank you very much and maybe I will just add to that that I think that startups you always see where the focus is you see innovation comes and I think there's a very very strong focus on smart mobility in Israel and therefore I think you see many many more startups in the area of smart mobility autonomous vehicles in Israel today I
31:53
would be interested why and Israeli an ecosystem is interested to cooperate
32:00
with you because I think Daimler or Mercedes-Benz isn't as big in Israel if you compare it to Google or Facebook it's not like a really star name I imagine so maybe I'll tell you my experience coming back to Israel you're
32:23
right Google and Facebook are very strong names but actually the market perception of Israel was extremely well perceived for Daimler coming in you know and as you remember I said that the focus of smart mobility in Israel in the startup scene is very very strong and so if you if you say okay this is a
32:44
focus area for the startups then of course Daimler is a great partner for us other than Daimler so we're GM was in Israel as the first OEM they established their site in 2008 they're around I think they were around 150
33:01
people until I think six months ago and the ramping up to 300 and we were the second OEM coming to Israel there was a lot of excitement now I think you see also other OEMs really considering coming in and there are also other OEMs like Renault but also maybe our more direct competition is
33:20
coming in and this is the questions I showed you earlier about me being interviewed just as much as I'm interviewing and how they perceive me was exactly what you were talking about but I think I really think that we have enough to offer and if you watch Daimler's Leadership 2020 culture change I think the company is really going through an amazing transformation
33:43
and the question in Israel is always can I make an impact and if the answer to that is yes you can make an impact then it's an amazing company to work for this is the way it's perceived and you can ask a allergy just joined so yeah and so as far as I understood you have just started yeah
34:12
your department how many people in the future will work there and how will the department be organized so we will be ramping up to 25 until 2018 establish
34:25
results and take it from there I think what I love about this company is we don't try to grab the entire Israel has a lot to offer in terms of cyber security AI big data tons of different areas autonomous vehicles many many
34:42
cameras vision a lot to offer there's a lot that we can do but we wanted to take it in stages so we will establish first results and then take it from there and I think you asked some something else the second question was how will you organize your department which structure will you focus on certain topics or will you go by functionalities so yeah so we will
35:04
have right now two strong let's say professional legs to our hub first one is the R&D where we will really do R&D development in cyber securities and other let's say digital innovation and then we will have the innovation leg
35:22
that a L is leading where we will harvest the ecosystem where we will work with startups will do hackathons do research university research and so forth so this is the two areas that we will work in and then you asked do did we establish some key focus areas we have so we have for now these are the
35:41
first we have decided what we're going to start with deliver results and then take it from there any more questions from the audience thank you for
36:06
joining enjoy the party later thank you thank you
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