Keynote by Futurist Gerd Leonhard at Mercedes Benz Vans Innovation Campus

Yes, hello, good morning, good morning, bonjour à tous. So, it's exciting to be here to talk to you about the future. The future is something, of course, that's very hard to predict, so I will not actually try to predict the future. I will share some observations about what is coming in the next couple of years and what we have to be careful of and what we have to look forward to. So first of all, let me get my clicker going here. We are looking at a world that's dramatically changing. I like to say that humanity will change more in the next 20 years than the previous 300 years. And not all of that will be totally exciting, of course. There's many issues with that. But if you're looking at things today around us, you can safely say that science fiction is becoming science fact. Self-driving cars, language translation on the mobile device, drones, robots, artificial intelligence. Many opportunities and quite a few challenges that we will have to tackle in this future. Most importantly, this curve, the exponential curve. You know about Moore's Law, Metcalfe's Law, it's kind of an old hat, right? But technology doubling in power every 2 years and becoming twice as cheap, That means now we're at the takeoff point on this curve. So it's a very important thing to notice that in the beginning of this curve, you actually don't feel it changing, because when you double 0.01, you still have nothing. But when you double 4 to 8, and to 16, 32, in 6 steps you're at 128. That's 7 years from now. If you have kids today that are roughly the age, say, 25, when they have kids, it's quite likely they will never drive a car that does not have a computer in it to drive it for them. They may never know what a CD looks like. They may not know what a book looks like, which is a scary thought because I write books, right? So, it's kind of a good thing to have books. But we're looking at a world that's at the takeoff point, and this is why we can't afford to wait. I'd like to say that "wait and see" means "waiting to die," because technology is now so explosive, moving so quickly, that we really have to know how we approach this. Just look at the way that we're always on, connected, interconnected at high speed, how much money and time is being spent on the Internet of Things. This is really impacting how we live, how we transport things. Artificial intelligence, künstliche Intelligenz, this is something where we have to say, well, mind-boggling idea that computers can think, right? Thinking machines? That's kind of a strange thought. Obviously, they will never think like we do, but hopefully they'll do something meaningful to make our life easier. And of course, this is really impacting business-to-business now in commerce. This is not just geeks and kids on social networks. This is impacting everything across the food chain: logistics, supply, procurement, environmental control. So, we're looking at the future where this curve means exponential data. Data is the new oil. You know, that saying is 12 years old. It's finally true. The most powerful companies in the world are companies that deal with data. I have a slide on that shortly. Intelligence, machines that can help us think, the sort of convergence of man and machine. There's lots of ethical issues that we'll have to tackle on this. Is by no means finished, a finished discussion, right? And then ultimately the question is, what is the human purpose? How does it serve us to be happy? Technology should serve us, not us serving technology. Very important thing to remember in the future, that everything that we do has to be towards that goal, right? Providing a context for humanity. But I live in Switzerland, so I pick a cow, right? The cows are getting connected in Switzerland, and you know why? Because they want to figure out when they're eating, how much they're eating, where they're going to, and so on, making things more efficient, more transparent. And then of course we have this syndrome that I would say that basically we're never offline, right? In fact, you could simply say that offline is a new luxury. So when you go away and you're offline, you're like, oh God, you know, I can finally disconnect. It's the opposite than it used to be. Cars that speak to our garages, and of course drones bringing our pizza. On that, I wouldn't be sure, both about the pizza and about the drones, but we'll talk about that later. Everything is becoming connected and smart. These days, if you want to start a new business, all you do is you take the current business, you put smart in front of it. Smart farming, smart cities, smart transportation, smart media, smart entertainment, smart medicine. It's exploding. This world is run by giant supercomputers. Many companies already have machines that are a million times as powerful. 40 quadrillion calculations per second. The most powerful computer in the world. That's 4 times as much as the human brain. And companies who do this, you can see the chart here, They are the data companies, right? They're companies that used to be the oil companies, the most powerful companies in the world, and we fought wars for oil, of course, right? Now it's the data companies. Look at the usual competitors. Alphabet, of course, is Google, right? So these companies are also going to innovate the space of pretty much anything, anywhere, anytime. This is why it's important to look at what they're doing. Artificial intelligence, machines that can tell us what to do next, augmented reality, virtual reality, the Internet of Things, the connectivity of devices. And this is what we get. Becoming as God, some people would say. I'm not religious, it's kind of a strange discussion, right? But we're becoming superhuman, in a way. We can use technology to do things that were impossible. We can have a team of 2 people do something that used to be 1,000 people. And then we have 500 people working on new jobs, for example, operating drones that didn't used to exist. People ask me about this all the time. Will there be new jobs? There will be new jobs. Maybe not as many as we would hope. Different discussion. But quite clearly, this is a world that we're going to look forward to. And really what happens here is something that you may experience when you use your e-book reader. You know, I travel a lot, so I noticed I've bought 10 times as many books on the e-book reader than I bought in print. And I have my— the queue of my books is like 287 books. I would have never bought that many books in real life, but we're going on this transition from physical to digital, and it impacts cars and transportation and tourism and telepresence pretty much in this order. Anything that has happened in the music business— I used to be in the music business, in the media business. Anything that happens in music, for example, or films and television, we're going to see in the other sectors. The changes will be gigantic and new opportunities, and of course, transportation, mobility, logistics is right on top of that list. Who would have thought 6 years ago that every major car company in the world is working on autonomous cars, shared cars, Electric cars, of course. And some people are saying, and this would be optimistic, of course, in 5 years we may only fill up our electric-powered vehicle once a month. Imagine the difference in behavior. Mind-boggling change. Go back to the music business for a second to tell you what happened when you're not in time, when you're refusing to actually acknowledge what is possible. When I worked in the music business, I used to be a musician and producer, I actually sold records, you know, the round things, you know, that— yeah, okay, plastic things, right? Now, of course, you know that the music business is all about streaming. And the record companies in their wisdom said they don't want people to stream because it will make less money. And you see on this curve what happened here. The new music business is not Sony, Universal, Warner, right? It's Apple and Spotify and YouTube and Baidu and Facebook. There is a new business, but you're not getting it. And that is something we want to avoid if you're in business. We want to be able to preclude the kind of thinking and not be disrupted and diminished. So, in this wave of disruption, the first wave really was media, phone calls, and of course computing and data. Now, on top of that wave is transportation. Down here we have the military, defense, and of course government, and insurances, and so on. And really, it's a mind-boggling time to witness the change of digital transformation of transport and mobility. And I think the B2B sector will be first to drive this because of efficiency, better services, better relationships with customers, new possibilities. So I really look forward to seeing that later. But I think the key to future success of this is to create powerful platforms. You know, the most successful companies in the world today, they're all platform companies. And there's sort of a term people use in America called platform feudalism, which in many ways is not all that positive, but you could say, what have they done? They've become indispensable. They create new ecosystems. And you could say many things that we don't like about Facebook and so on, but powerful platforms— and I think this is the key for the future— is to invent platforms of logistics, and of cities, and smart transportation. I look forward to seeing that in place. One thing that's happening here quite clearly is that in this world we're moving towards a new ecosystem, a new logic. Think about the things for a second that matter most to you. Right today, I think this week, people are gathering in what's called Burning Man. Any of you familiar with Burning Man? This big event in in California, in the desert. I don't know why you would go to the desert for this, but people do. And this is about the experience. People want to have experiences. And the more digital we are, the more we want the actual experience, the experience economy. This is very important to realize for business, because we're moving in the world from commodities to goods to services and experiences, providing experiences. And that's what we have to do to be successful. I'll give you a couple examples, and I think it's quite obvious to see that providing experience is actually pretty difficult because it involves an ecosystem. Take these guys. Anybody recognize this? This is the bar on top, on the 380 on Emirates. They have a bar there, and even though I don't use the bar because it's not actually good to drink much when you're flying, as I'm sure you're aware of, right? But it's a meeting point, right? It's an experience. And then, for example, Emirates makes it possible to check in 48 hours before your flight rather than 24. And we can be lucky if 24 hours would actually work at Swissair, for example. But I have to say, I still like flying Lufthansa and Swiss, but at the same time, the experience, right, is just different. So what would that be for transportation? For the driver, for the customers, for the city, for the citizens. That's what we have to look for. And this is where the innovation comes in, where it's all about creating an ecosystem that makes sense. The keyword here is liquid. You know, if you go on a social network, whatever you're using these days, it's a liquid experience, right? It just goes boom, and you've shared something to all your friends and back, It's instant, whatever service you're using. That's the power of WhatsApp, for example. Instant, liquid. Not secure, not private really, but yes, it's liquid, right? And this is really what we want. We want liquid experience. Why would we accept a service that is not liquid, that is completely different than anything else that we're doing? That requires a different kind of technology to be used. And it's interesting to see that the companies who are doing this, As many bad things that we can say about all of these guys, right? They have an entirely different paradigm. Airbnb owns no hotels or real estate. Facebook is the biggest media company, owns no media. The biggest taxi company, Uber, owns no cars. And the biggest, most valuable retailer, Alibaba, does not have any inventory. What does that mean for our future? Well, it means that we have to be ready for some serious changes, to think about how we can become ecosystems and platforms. This is one of the changes: voice control. We've talked about this, right? Talking about exponential, we talked about this for the last 20 years, never really worked. But now, just right now, computers are about 98% there understanding natural language. And that means about 34 languages, not Finnish or Swiss German, but pretty much anything else. You can speak to a computer like you speak to a friend. In fact, some people think that computers have become our friends. I would challenge that. But anyway, we can speak to our computers. And very soon we're going to stop typing. This is only a year or two away. Imagine what that means, for example, for delivery of goods. Speaking to the computer says, "Hey, I've got a problem, do XYZ," or order something, or instant updates. You've seen, of course, a couple services that do this, really, but the bottom line is what we've seen the last few years is like 0.01 on the exponential scale, and now we're at 4. I can guarantee you that your kids in 5 to 8 years will not even know what an app is. They'll just speak to whatever they have, like they speak to a person. Intelligent digital assistants. And if you're looking at the growth here, this is already an understatement. I mean, it's going to change the way of driving, of transportation, of cities. The past is going into the rearview mirror. We're going high-speed warp drive into a future that we have a hard time imagining sometimes. One of the challenges is this one: people, humans, are not exponential. We are linear. We are not going to grow like a computer. We can't put more memory into the slot. We have 10 quadrillion processes per second we can do. We're not going to do 100 quadrillion. So what will we do in the future? I think many of you are asking that question. I get it all the time. What will humans do in the future? If the machines do all these things? Well, the bottom line is this— really great little clip here from IBM— we're going to move up the food chain. We're not going to compete with computers on data and information. We're just not. Today, you kind of can, because computers aren't that smart yet, but they're getting there very quickly. We're moving up the food chain towards Intelligence, knowledge, and ultimately a kind of wisdom, right? Something that only people can do. When I meet you out in the hallway by accident, you know, it takes an average human 1.4 seconds to evaluate the other person. And that's without saying a single word. Computers are a long time away from that. We're going to need those skills more than ever before, and what's called emotional intelligence. People don't buy stuff because of computers and fancy algorithms or whatever technology, right? They buy stuff because of relationships. It's very important to keep that in mind for the future. We're going to need a really clever combination of algorithms and technology, which you're going to see today. And without that, I think the future is pretty grim as well. But then we also need this. I call this sometimes the androrhythms, right? Like the algorithms. The human things. And this is the ideal future if we can combine those two things in our products, in our services, in our brands, brand and purpose. So it's quite clear the future is going to involve that we are going to increasingly work with smart machines, software, robots, drones, machines, technology. I think what it means for us is that we can give up on the routine work, on the things that we could give to machines, and focus on those things that are human only. A driver with an automated vehicle can do many other things that maybe a computer couldn't do, like communicate, understand people, prepare. Definitely a future where we have to think about what that means. Here's the rule of digital Darwinism. I'm sure you've noticed, many of you are journalists, right? This is clearly a topic. Anything that can be digitized and automated will be. I write books. I was a musician and producer. Today in the studio you have software that plays the guitar. You have iPads that play the music. But here's the good news. I think this is what we have to hold on to in the future. Anything that cannot be digitized or automated becomes extremely valuable. And you know what that is? 95% of our lives. Cannot be digitized. Compassion, empathy, feelings, emotions, intuition, storytelling, creativity, all these things. That's what we're going to do in the future. If we can sit on top of technology doing that, that would be the perfect world. Let's hope we get there. We're going to need some pretty smart politicians. Well, that's an oxymoron anyway, but we're going to think about how we do this in the future. As Kevin Kelly said from Wired magazine, "Computers are for answers, people are for questions." I think it's going to be an important way for us in the future to look at this. Also, the other thing is that as we're looking at today's vehicles later on, efficiency is great, and every company wants to maximize efficiency. But let's not forget one thing about this, right? The new paradigm is ultimately efficiency has to serve a human purpose. You know what the purpose of business is? Customer happiness, customer delight. There's a difference, right? Efficiency is not the same as delight. We should not forget that when we roll out new products, when we talk about what we can do about the future. Because humanness is something that requires things that can't be automated. Trust, relationships, values cannot be automated. I think that's something that we need to keep in mind when we're looking at the future, what it brings, and where we're going. So let me give you a brief summary of my key theme here. I think it's very exciting to be part of that change today. It's about 95% things I would say it's extremely exciting. Humanity on top of technology. Those are things that we're going to look at. And this is kind of the summary I would give you, say, well, it's really all about data. Information, intelligence, and ultimately a kind of human purpose. Everything that we do should serve that purpose, right? Technology is not what we seek, it's how we seek. Let's keep in mind, however, if we don't have technology to do the how we seek, right, then we probably won't get to the other part either, right? So it's kind of a mutual relationship, right? If we look in this direction. I'll leave you with a quote of my mentor, David Bowie, who said already 20 years ago— rest in peace, by the way— "Tomorrow belongs to those who can hear it coming." So I wish for you to enjoy the day and hear the future, see the future today. And now I want to introduce Mr. Volker Mohenweg, the head of Mercedes-Benz Vans, who will talk to you about the same topics the digital transformation of his industry, his products, and of course the vehicles. Thanks very much for listening.