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How Data Is Helping Auto Industry To Adapt To COVID-19

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data

Data is the new oil. Whosoever controls the data controls the means to change the world. But with so much information bombarded to us on a daily basis how can we make sense of it all?

Our industries across the board are feeling the impact of the pandemic. Two major sectors during such a time namely the auto sector and the pharma industry are suffering from a supply constraint.

Demands for personal vehicles and medicine has soared since last year. But maintaining a proper supply, eliminating hurdles and keeping the chain intact has become increasingly reliant on data.

In an exclusive conversation, we took the help of the one known data expert Mr Manish Kumar working as a top executive in Data at CDK Global, a NASDAQ listed enterprise.

In the 21st century, data is absolutely the new oil. Can you give us an insight into the role of data in developing strategic solutions?

I like that statement -“Data is the new oil.” When I started around 18 years ago, data meant transactions between systems and individuals, which are being stored just for audit purposes, at least for most organizations. I am happy that we have evolved a lot in the past few years and realized the “worth of having data”. Data today plays a significant role in most strategic solutions, enabling solutions to automate a big chunk of processes, make intelligent decisions, prescribe options, and more.

Let’s understand it with some use cases in the automotive industry. Automotive dealers often cope with the issues of parts unavailability. One way of solving it is by stocking them up in large numbers, but that’s not effective as you may end up scraping them, leaving themselves at a loss.

An intelligent solution can help them deal with this problem statement, where data can be analyzed to understand the pattern of demand depending on location, population, type of vehicle, weather, road conditions, etc., and generate demand forecast by parts and dealers. An integrated solution where OEMs can see through the dealers’ inventory status in real-time and re-stock as soon as it goes below than expected demand. OEMs will also utilize this data to forecast orders for their part manufacturers.

Let’s take another instance, there are huge dependencies on the vehicle, and the cost of downtime is high. The connected vehicle is solving that problem to a large extent where vehicles are producing a huge amount of data, which is currently being used for operational purposes and to provide proactive maintenance. Strategically, organizations are moving towards harnessing the benefit of this data by turning “proactive maintenance” into “predictive maintenance”.

This will ensemble vehicle’s current condition with historical patterns; to predict when maintenance is required. This will save the cost for vehicle owners and help dealers to schedule maintenance for vehicles beforehand. It will also empower technicians to help to recommend parts replacements and other optional services to the customers. Overall, data is helping solutions to become more intelligent with enhanced customer experiences.

We witnessed the transformation of a significant chunk of the workforce last year. Do you think the change is here to stay, or will things go back to normal?

Well, you cannot be in the same shoe again. In the past year, a lot has changed. The things which we always pushed by saying, “is not possible” became possible in few months. Remember the first time when the government had announced “Stay at Home” orders everyone was panic as to how to deal with this situation. Companies were struggling to keep the work going, ensuring that their employees get all the support during this time to keep moving. Employees were worried about their job security, health issues, travelling back to their families in case they are staying away from them. So, Work from Home, which was a desirable option a year back, became more enforced. Lots of organizations acquiring the benefits of it in the form of saving on real estate and operational cost, and you may hear them announce work from home policy for a long duration.

We all settled down today, and things became normal, to which we started calling “New Normal”. But the question is, “Will this continue forever?” and a quick answer is “Not completely”.

Technology enabled us to work virtually from different locations across the globe and has its benefits, and the largest one is “Safety from Corona Virus”. But this has issues as well- fatigue, lack of creative collaboration, work-life balance, lack of infrastructure resulting in health issues, and many more.

So, permanent work from home is never a great solution. We need to think more creatively and figure out a solution that can help in both ways. There are organizations or job profiles which need to be in the office or field due to their nature of work, like doctors, administrative staff, factory workers, etc.

We can balance out employees who can work from home or office by putting more leniency around work from home policies but keeping them in rotation to work from the office as well. That’s just my very high-level thought, but on a more serious note, HR and executive management should think about creative ways to deal with it, as permanent work from home is not a good option.

The whole process of buying a car has changed as dealerships went digital; how do you think the customers have responded to that?

Oh, this was a long-awaited shift! If you look at the market, 30 to 40% of prospective customers are millennials, which will grow up to 50% in the next couple of years. Every industry is shifting its products and buying experience to match their needs and behaviour, and so is automotive. Pandemic accelerated the transformation, and we all witnessed it in the past year.

Data says that individual spends 4+ hours at dealer’s location to buy a car plus deals with some other hassles like travel time, documents preparation, etc., With this shift, now they are not only saving their time but also experiencing a much smoother and hassle-free process.

It enables them to view the car in 360-degree spins, select best-suited finance and insurance options, better quotation and negotiations, warranty options, contracting, home delivery, and many more, which they can complete over multiple sessions if required depending on their availability.

CDK’s “Connected Store” platform is helping its dealers to meet this new set of demands, where customers can experience a true digital workflow end-to-end.

India is witnessing this experience currently for pre-owned cars, which is valued at around $25 Billion in 2019-20, and if you look at the major players like Cars24, CarDekho, or Olx, they all are increasing their digital footprints every day. For buying a new car, India is having a partial digital experience and will take some more time to be fully digital. This is a cultural shift for us.

At the same time, you cannot ignore the value of physical stores as there is a large chunk of customers who research online, but before buying, they prefer to visit the store and see the things physically, spend time with sales representatives to get more information before deciding for purchase.

If I have a small business, how can advancement in data and AI help my business grow?

Small business means less capital, less number of labourer’s, and machines to grow faster with sustenance. Let’s take an example of a small coffee shop; the shop is well located and has regular footfall, which helps the business to manage its operational cost plus some earning.

Business is looking for an approach, help in increasing sales, reduce cost and enhance the customer experience without adding too much to its operational & marketing cost. Data and AI can be a game-changer;

  • Use the customer data like their orders history, demographics, location, etc. to design a campaign to have more footfalls
  • Use bots to generate refill orders for raw materials automatically
  • AI-based recommendation engine helping their customers to order additional relevant items
  • AI-enabled voice assistant to take orders and provide relevant information to customers

You may ask these technology investments can be big and do not look viable for a small coffee shop, but that’s not true. These services are becoming cheaper every day with the help of technological advancement.

It was just an example of a small coffee shop, but different businesses can leverage data and AI in different ways to automate and accelerate. One needs to be mindful of the implementation, use cases, and objectives. You may experience disappointments if you don’t leverage them in the right way.

CDK neuron platform is conceptualized keeping these needs in mind helping small to large dealers leveraging the benefits of data and AI. The platform leverage an analytics engine powered by artificial intelligence and machine learning to create real-time predictive and prescriptive insights. It will empower our dealers and OEMs to sell and service more vehicles and create more personalized and differentiated customer experiences.

What is a data lake, and how can it help consumers and business owners?

As per Wiki, a data lake is a system or repository of data stored in its natural/raw format, usually, object blobs or files.

In my words, it’s a lake, which does not care about its source, type, impurity, amount, speed, type, purpose, etc., with a difference that it stores data than water. One needs to think of the bigger question is why does it exist?

Conventionally, whenever we talk about data, we imagine some numbers and text organized in the form of rows and columns, which is still true, but nowadays, this definition got more attributes like comments, videos, pictures on social media, machines generated logs, report files, financial files, prescriptions provided by a doctor or interaction with support agents.

All these are now called data that do not have a defined structure. They are raw, which may or may not have any sense when you look at them individually. It has multiple use case which may not be known when collected. But we need it so that it can be processed for a specific purpose, and here Data Lake comes into the picture.

It provides a storage mechanism for structured or unstructured data in large volumes, which can be stored in a fashion that can be searched and retrieved when required within a fraction of a second.

The majority of enterprises today are investing in Data Lakes to store a huge amount of raw data, which they can leverage for analytics, machine learning, and sometimes for audit purposes as well.

The biggest benefit that enterprises are reaping is “Data Availability” and “Breaking Data Silos”. When you start your study of data or would like to apply machine learning to solve some complex problems, the very first thing you require is “Data”.

As I mentioned earlier that data is being generated from multiple sources and have multiple owners of it, so if you start collecting and structuring the data when you figure out the need of it, it will push your final objective by month or sometimes years, and at the end, you will have zero ROI since the opportunity may not be valid at that time.

This is one of the big reasons why many data science projects fail, or I would say lost interest in it. I imagine that days are not far where you will see Data Lake as fully managed services for small and medium-size organizations who wish to collect and prepare the data but would not like to invest huge CapEx and Opex.

These services will enable them for collecting all the relevant data they need, store, curate, and finally get insights out of it in the form of prediction, prescription, or just operational reports.

To conclude, Data Lake is solving the problem of “Availability of data at the right time in raw form with proper control”, which can be utilized for multiple analytics use cases without having a large lead time.

With regards to the pandemic, how are your products helping business adapt to the new normal?

What we are calling a new normal is just an accelerated shift in the behaviour of consumers due to pandemics and restrictions it brought to us. CDK knows that the car buying and related services processes have been evolving much before the pandemic and was already in a direction to enhance the offerings and products to match the upcoming demand.

One big change which we all had observed was “Going Digital/Online” since people were restricted to stay home due to safety reasons. “Connected Store” is one of the products that CDK offers to automotive dealers enabling their ‘true online dealership experience’. A car buying experience that is completely remote, end-to-end, starting from attracting consumers and provide comparisons, manage quotations, negotiate, F&I, contract, payment, and finally deliver, that too at the pace customer would like to traverse through the process.

In May 2020, CDK had made it free for our dealers, which helped them in bringing their online presence without putting a burden on their pockets through the tough time we all have seen.

Service is another big area which also gets hugely impacted due to pandemic. CDK dealers have the flexibility to help their customers in booking an appointment online using the CDK appointment tool, but what after that, at the time where people restrict themselves in going out, how would they take their cars to the dealership for service?

CDK helped its dealers by providing an option for service pickup and delivery facilitated by Hailer. A dealership employee can take a Lyft ride to the service customer’s home to pick up the vehicle.

The employee then drives the customer’s vehicle back to the dealership, where the service is performed. Once the service is completed, the employee drives the customer’s vehicle back, drops it off at the customer’s home, and takes a Lyft ride back to the dealership.

This way, our dealers and their consumers got a great relief, where the dealers can now keep the door open, and consumers will not have to take the risk to ensure timely service.

These are just instances of how we have helped our dealers adopting the new normal. We are continuously working towards modernizing our products and add more capabilities meeting the demand of today and the future.

How is data accelerating the formation of a cure for Covid-19?

I worked for two large pharma companies as an external consultant, and one thing I learned that “Data is the oil” for them. From developing a new drug to the supply chain, data is the key.

Pharma companies utilize diagnosis, treatment, medication, and prognosis data to take decisions within a short time frame. This also helps in detecting risks and safety issues.

Launching a drug to the market and measure its performance requires a lot of research based on data. I remember companies managing such information with giant spreadsheets and a large number of people playing with it to figure out the actionable.

With the help of cloud-based data lakes and modern age analytics tools, processing and visualizing the insights became much easier and faster.

Clinical trials and FDA approval for launching new drugs cost $150 Million to 1.5 Billion; AI and data are helping companies to increase their success rate and reduce the operational cost.

Verge Genomics is researching new treatments for a patient suffering from Alzheimer’s with the help of artificial intelligence, IBM Watson helping pharma companies choosing the right patients for drug trials, AstraZeneca is researching automated cancer diagnostic using AI.

You will find tons of use cases where these organization is leveraging AI and data for better and faster results.

The IoT-based wearable will bring some more advancements in the future; it’s not far that pharma companies collect these data to analyze individual behaviour, pattern and provide recommendations like supplements which itself hold a multi-billion market.

Nations across the world developed a vaccine in record time. Can you explain the role of data and AI in speeding up this process?

COVID-19 is one of the most infectious diseases across the world that impacted more than 190 countries, with 132 million people infected and killed around 2.5 million people worldwide. The entire world was looking for a vaccine, and scientists had to meet a timeline which was “as soon as possible”. Developing a vaccine for Covid-19 required a great study of virus capabilities, virulence, and genome.

They also need to study its protein structure and reactions with other chemical compounds. Furthermore, detailed and large clinical research was also required to figure out the effectiveness of the vaccine once identified. AI and ML played a significant role, resulting in the final vaccine product available for individuals. ‘

Models like CNN were used to research X-ray images to identify the pattern of a virus on different patients; Neural Networks were used to predict virus mutation. Natural Language Generation (NLG) has been used to study a large number of clinical trial documents and deep learning models to build comprehensive study outcomes. Overall without AI and ML, it was impossible to develop the vaccine in such a record time.

Moving forward, which industry do you think will see the most use of AI and Machine learning?

I believe that almost every industry will use AI and machine learning in some shape or form, and measuring who is using it more or less will be complex, as a simple application of these in some industries can bring a big change whereas in some industries it will be the other way round. Still, if we would like to categorize some industries which I see as the top users of these technologies without in any specific order are –

  • IT industry – Legacy IT solutions have reached to its saturation point and need capabilities to enhance the user experience, reduce workload, automate, and many more. This is one key reason why one finds many IT companies are investing in AI/ML, helping their solutions to become intelligent, which can take decisions, recommend actions, and in some cases, it can be intelligent enough so can “learn to take actions”.
  • Healthcare – We are talking about robotic surgery, pattern-based diagnosis, clinical research, and many more, which couldn’t be a reality without having AI and ML. In my opinion, they are the largest users of artificial intelligence and will grow exponentially in the near future.
  • E-commerce, Marketing & Research companies – You feel amazed when Amazon provides you with a recommendation of a product based on your search or when you receive a product/service advertisement on your social site page you looking for. AI/ML enables these organizations to impact around 22% of the global retail sales.
  • Manufacturing (Shopping Products, Automobile, Smart Factories, etc.) – IOT based products to self-driven cars, using AI/ML to the best of its possibilities. Artificial Intelligence today is the heart of Industry 4.0; the smart manufacturing market is around $320 B and is expected to grow with a growth rate of 12.5%.
  • Telecom- India has seen 1.17 B mobile subscribers by Sep 2020 and is growing every day. Retaining this huge size of customers in today’s competitive world is not easy. Telecom companies are utilizing users’ data to customize their offerings, keep their network-ready, and improve their customer service.
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yetnesh
Assistant Editor at Exhibit Magazine. A tech and auto journalist who likes to reverse engineer anything he can get his hands on. He writes about everything technical under the sun, ranging from smartphones and laptops to micro-controllers in Tesla batteries.

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