The transport and logistics sector, considered the connecting link in the global economy, is still undergoing dramatic changes in a world dominated by mind-blowing technological advances. Understandably, transport and logistics operators are always on the lookout for transformative innovations for possible adoption to keep them relevant.
Constant innovation keeps them up to date and capable of meeting any contemporary needs.
Changes such as customer expectations concerning quality, speed, and costs; big data analytics, robots, and autonomous vehicles; new entrants with radically different business models and without dated assets; and cooperation on sharing facilities by parties in the chain are driving many industry players to go beyond their business-as-usual attitude.
Embracing innovation is widely accepted as a key driver of economic growth and productivity. In the US’s road transport system, the country has rolled out its Electronic Logging Devices (ELD) initiative as its main digitalisation effort.
Since December 2017, ELD have been mandatory on all trucks operating in the US. Although supported by some organisations, the initiative, however, was met with concerns over how ELD data would be used by the authorities and how data security would be ensured.
But Europe can alleviate potential fears by offering its experiences to its American colleagues to demonstrate the benefits on the ground.
In addition, countries are now setting their sights on more flexible, adaptable, and well-regulated models compared to the current system still employed by many developed and developing economies. Because of rapid technological innovations, data can be made available almost instantly to create new opportunities for the planning and management of deeply integrated, highly efficient, multimodal transport systems — from pedestrian traffic to sea and air transport.
The UK, for instance, has adopted the concept of sharing real-time data, a concept that helps to enable the more efficient use of infrastructure. Its smart motorways system uses real-time data to regulate and stabilise traffic flows, warn drivers of congestion ahead, and automatically open additional lanes when the road becomes busy.
Already, drivers are making use of crowdsourced data about road conditions to enable real-time route optimisation to bypass congested routes.
However, the transport and logistics sector is replete with challenges, especially in the arena of higher efficiency. Innovation will help address this particular issue.
The Sharjah Research, Technology and Innovation (RTI) Park has undertaken several activities aimed at fostering collaboration among involved stakeholders in the transport and logistics domain regarding innovative solutions.
The Sharjah RTI Park approach for supporting logistics innovation involves three interlinked and mutually reinforcing dimensions. These are innovative business models within the supply chain, innovative logistics best practices, and innovative technologies.
Global exchange of best practices is crucial against the context of fundamental change in the transport and logistics landscape. Take for example Europe and Eurasia where clear steps towards the adoption digital transport documents are taking place.
These regions can learn from the practical experiences of Brazil and Mexico. Transport consignment notes in both countries have been made electronic for years now, providing increased transparency between stakeholders and simplifying compliance with regulatory processes.
Apart from global best practices, providers also need to continue along the path of transformation in terms of business model innovation and appropriate use of technology as these will also make a huge difference in the transport and logistics sector.
There is a need to tailor their business models to meet the needs of more demanding customers, whether by increasing integration or simplifying to deliver a no-frills, low-cost service. While the benefits need to be balanced against the costs, technology still has the potential to deliver sustained improvements in productivity.
Innovation is not a single solution. It is a revolution that is impacting every single aspect of urban transport.
Every country should embrace it to ensure the sustainability of road transport operations as it looks towards the future.
Hussain Al Mahmoudi is CEO of Sharjah Research Technology and Innovation (SRTI) Park.