News In Context

VW Group Launches AI Lab To Keep Up With The Pace Of Change

Volkswagen Group’s January 31 announcement that is opening a specialized AI Lab to act as a globally networked competence center and incubator comes as no real surprise. Large companies across all sectors are struggling with how to best integrate AI into their businesses and keep up with the pace of change.

In 2023, business leaders faced an all-time-high rate of change and a majority expect change to accelerate further in 2024, according to Accenture’s Pulse of Change: 2024 Index, which  identifies and ranks six factors of change affecting businesses—Technology, Talent, Economic, Geopolitical, Climate and Consumer & Social—using a range of key business indicators, such as labor productivity and IT spending.

The Index indicator analysis found that overall, across all six factors, the rate of change has risen steadily since 2019 :183% over the past four years and 33% in the past year alone. The C-suite survey reveals that a striking 88% anticipate an even faster rate of change in 2024. The No. 1 cause of business change in 2023? Technology. However, nearly half (47%) of more than 3,400 C-suite leaders surveyed say they are not fully prepared for the accelerating rate of technological change. Only 27% claim their organizations are ready to scale up Generative AI; 44% say it will take more than six months to do so and take advantage of the potential benefits.

In the case of Volkswagen Group, the objective of the AI Lab is to rapidly develop digital prototypes and transfer them to the Group brands for implementation. The AI Lab will not manufacture production models but will serve as an incubator for the Volkswagen Group, the company said in a press release. The AI Lab will identify new product ideas connected with artificial intelligence throughout the world. It will then develop what it considers to be highly promising concepts together with partners to produce early prototypes. It will have a team of AI experts and work closely with all the brands. High-ranking representative of the brand groups will form the Supervisory Board.

“By adopting this approach, the VW Group intends to simplify the potential and speed of the AI sector,” Oliver Blume, CEO of the Volkswagen Group and Porsche AG, said in a statement. “Collaboration with technology companies is crucially important for us. In future we intend to simplify cooperation in organizational and cultural terms.”

Tapping into the AI ecosystem to leverage the power of AI for specific use cases “is a smart move, however creating a specialized outside vehicle to speed up AI developments has its pros and cons”, Dr. Carsten Linz, the CEO of bluegain, a technology and professional service firm that helps leaders to transform established companies, and a member of the World Economic Forum’s Expert Network on Digital Economy and New Leadership, said in an interview with The Innovator.

While some companies have had success with implementing a “separate-then-integrate” approach for technology-led innovation – German Publisher Axel Springer successfully adopted this approach as part of its digitalization strategy – Linz says industrial players like the Italian electric utility Enel or the German Industrial group Siemens. usually have more success with an “embed-then-scale-out” approach.

Looking back, VW took already a similar approach to the AI Lab with its software development for the group, without much success. Its outside software unit Cariad, which has struggled with years of delays and overhauls, is currently developing a restructuring plan which reports say could involve cutting thousands of positions as the unit attempts to bring new software architectures onto the market.

“The transformation of automotive OEMs from hardware companies to producers of software-defined systems requires them to redefine what is core competence and what is context,” says Linz. “For AI this means to leverage the power of Large Language Models developed by others, deployed in a private Cloud and with a secure gateway then enrich the value with the car company’s proprietary data; its power lies not only in its possession, but in its strategic application. In this way you create a sustainable competitive advantage and avoid having your confidential information train the next model.”

Linz suggests companies that want to use the power of AI and other digital technologies and leverage their domain specific expertise to adhere to these five principles:

*Establish A Use Case Focus: Have new technologies assessed by people in lines of business, often mid-level managers in technical roles looking for ways to improve the efficiency of their existing operations or grow their business

*Create Mixed Teams: Ensure your pilots are constructed in a decentralized way by a small mixed frontline team of business, digital and IT people embedded within a business unit, preferably together with internal pilot clients.

*Embed And Scale-Out: Be close to domain-specific knowledge instead of taking a separate-then-integrate approach.

*Gradually Provide More Degrees Of Autonomy: This will help the scale-up finds the right growth path

*Secure Robust Sponsorship: Get buy-in from the top that is sensitive to the power bases within the firm.

To leverage the full value of AI for specific business cases, co-created with the organization’s experts and their domain-specific expertise, “the need to cleanse, correct and complete the data for the specific use cases cannot be overstated,” says Linz. “The good thing is that you can use AI to accomplish this task.”



Neurolink Plants Brain Chip In First Human

The first human patient has received an implant from brain-chip startup Neuralink and is recovering well, the company’s billionaire founder Elon Musk said. The U.S. Food and Drug Administration had given the company clearance last year to conduct its first trial to test its implant on humans, a critical milestone in the startup’s ambitions to help patients overcome paralysis and a host of neurological conditions. The study uses a robot to surgically place a brain-computer interface (BCI) implant in a region of the brain that controls the intention to move. Its initial goal is to enable people to control a computer cursor or keyboard using their thoughts alone.


Mastercard Says Its New Gen AI Product Can Boost Fraud Detection by 300%

Payments giant Mastercard says it has built its own proprietary generative artificial intelligence model to help thousands of banks in its network detect and root out fraudulent transactions. The company told CNBC that its new advanced AI model, Decision Intelligence Pro, will allow banks to better assess suspicious transactions on its network in real-time and determine whether they’re legitimate or not.


H2 Green Steel Has Raised Additional Funding To Build World’s First Large Scale Green Hydrogen-Based Steel Plant

H2 Green Steel (H2GS) has secured an additional €4.5bn of funding to help build the world’s first large-scale green steel project, which will incorporate about 1GW of electrolysers, making it the biggest green hydrogen facility in Europe. The Swedish start-up, founded in 2020, now has close to €6.5 billion of financing in place, and is expected to soon take a final investment decision  on its plant in Boden, northern Sweden, which will use a combination of green hydrogen and renewable electricity to produce near-zero-emission steel.

Judge Allows Lawsuit Over Evian’s ‘Carbon Neutral’ Claim To Proceed

Ag Funder News reports that Danone has failed in its initial bid to squash a proposed class action lawsuit accusing it of misleading shoppers with a ‘carbon neutral’ claim on Evian bottled water after a judge determined the claim “may plausibly deceive and mislead” consumers. Regulatory affairs experts are closely watching the lawsuit — filed vs Danone Waters of America in New York in 2022 — amid growing scrutiny of ‘green’ claims, while some large CPG players including Nestlé are reportedly souring on the term. In this case, the ‘carbon neutral’ claim at issue was certified by a high-profile third party: The Carbon Trust.  According to the plaintiffs, reasonable consumers “would understand and believe that the term ‘carbon neutral’ means the manufacturing of the product, from materials used, to production, to transportation, is sustainable and does not leave a carbon footprint.”​

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About the author

Jennifer L. Schenker

Jennifer L. Schenker, an award-winning journalist, has been covering the global tech industry from Europe since 1985, working full-time, at various points in her career for the Wall Street Journal Europe, Time Magazine, International Herald Tribune, Red Herring and BusinessWeek. She is currently the editor-in-chief of The Innovator, an English-language global publication about the digital transformation of business. Jennifer was voted one of the 50 most inspiring women in technology in Europe in 2015 and 2016 and was named by Forbes Magazine in 2018 as one of the 30 women leaders disrupting tech in France. She has been a World Economic Forum Tech Pioneers judge for 20 years. She lives in Paris and has dual U.S. and French citizenship.