Karin Rådström: So, I uh started as the CEO of Daimler Truck two years ago. Um didn't get called actually uh by Morgan Stanley, but maybe I'm still waiting for that. Um one of the first things I did, which I think is quite reasonable when you start as a new CEO, working through the strategy. So, I worked with my management board, of course, strategy department, uh some consultants who wanted to give us advice. um top down, bottom up, bringing in the talents and sort of coming out with um what I thought and the whole board thought was a really really strong strategy. Five pillars, very clear uh vision, mission, we know what to do.

And then the first time we were going to present the strategy was in our top leadership meeting with the top 200 leaders of the company. And just a couple of days before actually just kind of out of curiosity I started looking you know what have we said in the past in these conferences and what did the former CEOs talk about and then I realized when we started flipping through the old slides. Uh a lot of the strategy was kind of the same as what we had been talking about for or not me but my predecessors for like the last 15 uh 20 years. uh for sure there were new elements like digitalization, AI, servitization etc.

But if you looked at the bulk of it really to be very honest a lot was quite similar and then we realized that we actually don't really have a strategy problem in our company. we have an execution problem and this is really tricky because as you mentioned in the introduction we're 130 years old uh engineering excellence always innovation leader um today we're the biggest truck and bus company in the world um so obviously we did a lot of things right to get to where we are today but that does not guarantee success not even the next quarter and definitely not for the next 10, 20 or even 130 years.

And besides that, as we talked about a lot, uh the world is really changing. Um you have everything kind of macro or um on a large scale that's happening in the world with AI, technology, geopolitics, the shift of power balance in the world. But besides that, in our industry, we also have the transformation of technology. Uh we've been developing diesel trucks for the last 100 plus years. Now we're looking at electrification, hydrogen. We have softwaredefined vehicles. Uh we also do a lot of work into self-driving vehicles. There's new business models. People don't want to own the assets anymore. So our industry is also changing.

And besides that, Daimler Truck is changing. On the one hand, we're 130 years old. On the other hand, actually we were spun off out of this big Daimler conglomerate just four years ago. So in many ways, we're just a fouryear-old company learning what it's like to be to be a listed company um and and to function in that environment. So without putting any blame on the past, we needed to focus a lot more on how do we drive transformation going forward.

And then we came up with these um three kind of simple words simpler, faster, stronger. And that's a mindset that we now try to bring into everything we do in the company. And it's sounds very easy. Someone else also talked about doing things simpler, but I mean we are a German company. I would say we're a global company, but our headquarter is in South Germany and we're very proud of our heritage and what we come from. But for sure we had in order to build the engineering excellence that built our strong history, we needed to pay attention to detail. And I think German success is really built on strong structures, clear decisions, strong direction. So that's not so easy to change. It's not enough to put simpler, faster, stronger on the wall and expect everyone to run.

But where I see it really positive is it's actually a license for anyone in the company to question how we do things. And that's maybe also not the historical strengths of German companies that people really stand up and ask why do we do it like that? But I've heard now from many people in the company it's like yeah is there a simpler faster way we can do this? And that kind of opens a different kind of conversation than when you're just perceived like you're complaining about your boss potentially.

Um but we wanted to do it even more let's say concrete. So we started looking more broadly on culture and what is culture and the way we defined it in our company is the culture is the sum of all the practices you have in the company. and practices can be a couple of different things. So, first of all, it's the values. It's kind of the the words on the wall and and what you put in your uh annual reports and and what you say that you stand for. But practices is also all the processes that you have in the company. The formal processes on how you recruit people, how you um pay for performance, budgeting, whatever. And then it's also all the informal processes um which is the way you do things in a company which is actually not a formal process but everyone just kind of knows that's how we always do it here and that's how it always has been done and we started looking at all these practices and actually we found a very structured way that we are picking three to four practices every month that we want to change and we look at it we describe how do we do it today and what's the desired state on how we want to do it in the future and then we're rolling out new practices in waves. So every one to two months we have a wave and there's three to four new practices coming.

And I think that's a very concrete way to drive a change of culture in a very old company and it can be you know some of it is like super well sounds basic but even the small things are not easy. Um so what we do now is we start every meeting by looking at who's sitting around the table. Why are you here? Are you here because you want to add to the discussion? you want to be part of the decision making. Are you just here to gather information or are you here because this guy is presenting and I'm his boss and then the boss of the boss and then the boss of the boss. So I just have to be in the room to be sure what's being said. And by doing that we have realized actually we can walk a lot of people out of the room uh who are not there to really contribute to a to a result.

Um also I got crazy when I joined Daimler. There's powerpoints for everything. So every meeting I get a PowerPoint. It's like 50 pages. I have to pre-eread. I come in. Um so that's we have not totally banned PowerPoints but we have stopped having powerpoints by default. Um and we see that it drives a completely different quality of discussion because you really focus on the problem and how to solve it instead of sometime spending a lot of time describing all the backgrounds.

Um so those are some small ones. Then there's some bigger ones. uh trying to kill the budget process right now. Um normally we would already now actually start to plan the budget for 2027. Um it's you know starts with what's the total market going to be what's macro etc. And then we build from bottom up. It's a huge process very structured. Um so now we're killing the budget process.

uh we will not start until October, November because then we have to prepare it for the board and that's a really interesting one um and it's very fundamental um in our company because it's it's one of the real core processes that that some people love. Um so yeah, not me. Um so maybe that's a little bit just the practical approach to to how to change culture and I think we're just getting started on this journey. Um when people already now start to get frustrated I tell them you know this is not a campaign this is really something we need to go out and focus on and I think I will do it for my whole CEO tenure to really push push push push and slowly move step by step by step by step. Um, but that's what makes it so fun and interesting to be in these old industries that are transforming very fast.