Daimler adopts Silicon Valley tactics to counter new competitors

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Mercedes-Benz maker Daimler is welcoming Silicon Valley management techniques in a drive to speed up decision making, empower personnel and ward off brand-new competitors such as electric automaker Tesla Motors.

Chairman of the Board of Directors of Daimler AG, Dieter Zetsche is sweeping away layers of bureaucracy and motivating a more experimental approach to brand-new products. He has likewise asked 144 workers – numerous of them from the rank and file – to create new management ideas, according to sources at the German high-end car manufacturer.

These are huge modifications for a company understood for strict hierarchies and precise preparation, and follow a journey by around 100 top supervisors to Silicon Valley last summertime when they met executives from companies such as Apple, Google and Uber.

The modifications will be carefully enjoyed by competitors such as BMW and Audi as conventional automakers weigh up how to react to brand-new technologies consisting of self-driving and electrical automobiles that have actually turned companies like Google and Tesla into competitors.

Daimler, whose founder invented the modern-day automobile 130 years back, is investing heavily in electrical cars and Zetsche has chosen that in order to succeed, the business, as well as its product range, requires an overhaul.

Laying out a few of his plans in June, he compared Daimler to a rhino however said its size – with two times Tesla’s market capitalization and 20 times the number of staff – did not mean it could not likewise be active and decisive.

“Rhinos are large, but they are not slow,” Zetsche told.

Alexander Hilliger von Thile, a senior graphics and rendering manager at Mercedes-Benz research and development in North America, said Daimler was now encouraging concepts from all employee and not simply the “Bereichsleiter” or department chiefs, in addition to greater collaboration.

“We do not want to have experts who understand everything, who sit somewhere and don’t talk anybody,” he told Reuters.

Daimler, like lots of standard automakers, was at first doubtful about potential customers for electric vehicles. According to a senior executive, Zetsche used to joke that Daimler, that owned a stake in Tesla from 2009-2014, was the only car manufacturer to make cash from electric automobiles when it sold out of that investment.

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