Industrial AI for the Physical World: Siemens’s Peter Koerte

**SPEAKER_1** (0:02)
Consumer AI makes headlines daily, but industrial AI increasingly enhances and enables nearly everything we do. Learn how one multinational company approaches data management and deployments at scale on today's episode.

**Peter Koerte** (0:15)
I'm Peter Koerte from Siemens, and you're listening to Me, Myself, and AI.

**Sam Ransbotham** (0:21)
Welcome to Me, Myself, and AI, a podcast from MIT Sloan Management Review, exploring the future of artificial intelligence. I'm Sam Ransbotham, Professor of Analytics at Boston College. I've been researching data, analytics, and AI at MIT SMR since 2014, with research articles, annual industry reports, case studies, and now 13 seasons of podcast episodes. In each episode, corporate leaders, cutting-edge researchers, and AI policymakers join us to break down what separates AI hype from AI success.
Today, we're talking with Peter Koerte, Chief Technology Officer at Siemens. Siemens is a German multinational technology company focused on industrial automation, smart infrastructure, and mobility systems, all increasingly important topics. We'll discuss industrial AI, what it means for the workforce, and what the implications are for data sharing across industry. Peter, welcome.

**Peter Koerte** (1:19)
Thank you, Sam, for having me.

**Sam Ransbotham** (1:21)
Great. Let's start at a high level. Some of our listeners may not be familiar with Siemens. Can you give us a brief overview?

**Peter Koerte** (1:27)
Yeah, sure. Siemens is out there since 180 years almost.
What we say is, we transform the everyday of everyone. What that means is, if you think about the chair right now that you're sitting on, the clothes that you're wearing, the water that you're drinking, the electricity that you're using, the transportation system such as trains that you're using on an everyday, all of that was enabled by Siemens. When it came down to the way we design these things, we produce them, how we actually make sure electricity is safe and distributed, how transportation is run smoothly and safely. All of that is coming through Siemens except as a consumer, usually you don't see us. But in the industrial world, Siemens is a very, very big brand name and we are recognized for the high quality, but also for the great solutions we bring and the simplicity to our customers.

**Sam Ransbotham** (2:20)
Yeah, I think that's a great example because so much of the world we rely on, we just don't pay attention to. We don't notice it unless it isn't working for some reason. You talked about industrial AI.
What exactly is the difference between industrial AI and consumer AI that most people would be familiar with?

**Peter Koerte** (2:36)
Yeah, the big difference is today, of course, consumer AI is making the headlines. While we think industrial AI is quietly, but profoundly changing the physical infrastructure, the physical world that we know of.
Think about, for example, the building that we are sitting in right now.
That building has, of course, some climate control. About 30-40 percent of all the electricity that we're using today goes into buildings. What we're saying is, what if we actually can take all the sensors that we have in these buildings, then develop an AI that automatically learns every minute or 15 minutes in that case, and then automatically adjusts all the temperature settings, all the lighting settings, and everything in order to cut cost and energy. And that's exactly what we're doing. We just launched an application that saves 30 percent of your energy bill and therefore reduces greenhouse gases by 30 percent just by doing that. It runs autonomously in the background. And this is what we do for grids. We do this for factories. We do this for machines. We do this for, of course, buildings and we do this for trains. So everything in the real world, we are making it more efficient simply by what we say, connecting the real world and the digital world, where we try to optimize and make things better.

**Sam Ransbotham** (3:58)
Yeah, that makes a lot of sense. I mean, I'm sitting here on a university campus. It's spring break, and I guess we are probably heating this place about the same as we would be if it was full of people. I don't even want to ask. I don't want to know here.

**Peter Koerte** (4:11)
That's it. That's it.

**Sam Ransbotham** (4:12)
Well, I think we're all familiar with consumer applications, and I think the failures of AI in consumer applications get a lot of attention, with the hallucinations and these sorts of things. Somehow that seems very different if you're connecting this to the physical world. It's not just a funny anecdote that goes across the Internet when AI screws up. It could have some real-world consequences when you make that connection.
How is Siemens thinking about that?