This document discusses emerging trends that will impact freight transportation in the digital future. It notes that demographic, social, economic, and technological changes are happening outside the freight industry. Examples of digital technologies influencing freight include increased use of sensors and data in vehicles, new modes of transportation like drones, more automation, and the sharing economy being applied to freight. Artificial intelligence and blockchain also show potential to transform operations through real-time decision making and increased transparency in supply chain records.

1. Smart access/guidance control

2. Smart access/guidance control

3. Smart access/guidance control

4. Smart access/guidance control

5. Per Olof Arnäs, PhD
Chalmers University of Technology
Service Management and Logistics
per-olof.arnas@chalmers.se
about.me/perolofarnas
Slides: slideshare.net/poar
@Dr_PO
OKIMG_5751 by taymtaym on Flickr (CC-BY)
Some observations
regarding the
digital future
of transportation

6. Demographic
and social
change
Shift in
economic
power
Rapid
urbanisation
Technological
breakthroughsClimate
change and
resource
scarcity
5
GLOBAL
TRENDS

7. Things are happening outside the
freight industry
(and have been for some time)

8. Things are happening outside the
freight industry
(and have been for some time)
1957

9. Things are happening outside the
freight industry
(and have been for some time)
Image: Richard Hancock, twitter.com/CanaryWorf
2015

10. MobileWorldCongress2016byKārlisDambrānsonFlickr(CC-BY)
Increased use of
digital technology
Digitalization:
Make analogue
information digital
Digitization:
Both are important! (and interesting)

11. So…
Is nothing
happening in
freight transport
then?!

12. DIGITAL
TRANSACTION
HANDLING

13. Basic data
From/To/What/When
Owner: the customer
Resource allocation
What vehicle?
Owner: Traffic controller
Cargo information
Loaded amount
Owner: Supplier
Proof of Delivery
Time/date/signature
Owner: Driver
Pricing
Owner: Financial dept.
Enough information to create invoice
All of these steps cost money!
From order to invoice
(transportation company)

14. An increase in the number of
orders lead to increased cost
Goal: De-couple the
dependecy between
administative cost and
order volume
Number of orders per year
Total cost for
administration of all orders
Handle exceptions – not
transactions!

15. Integration of digital and physical worlds
http://www.sygic.com/gps-navigation/addon/head-up-display

16. Say hi to the new sensors
http://mobsentech.com

17. ”New” modes of
transport
https://www.youtube.com/watch?v=50sv4M4rgBM
https://www.youtube.com/watch?v=HG76DcXySuw

18. More automation

19. The sharing economy hits freight transport
(again and again…)

20. Supply (traditional)
A few standardised
services with high
volume
Examples:
Hotels, retail chains,
newspapers, taxi companies

21. Demand
A large variety of
preferences
Supply (traditional)

22. Demand
A large variety of
preferences
A long tail of demand is met
by a short tail of supply
Supply (traditional)

23. Supply (sharing economy)
A large variety of
services, each with a
small volume
A long tail of demand is met
by a long tail of supply
Demand
A large variety of
preferences
Made possible with
technology!

24. https://www.statista.com/chart/11810/singles-day-vs-cyber-monday-and-black-friday/

25. Servitization
Move up in the
value chain
Upgrade drop points
Consumer services
Expose data
Mall of Scandinavia
http://www.smartcompany.com.au/growth/innovation/41765-online-retailer-offers-
a-courier-that-waits-at-your-door-fashion-advice-not-included.html
https://www.amazon.com/dashbutton
https://www.shyp.com

26. Strategic Tactical Operational Predictive
Time horizons
We are approaching
this boundary
…and we are
starting to
move past it!
Real-time!

27. The Action of New York City by
Trey Ratcliff on Flickr (CC-BY,NC,SA)
Real-time (data driven)
decision making
Data collection
Data processing
Data exploitation
http://mindconnect.se/
http://waze.com
https://mydrive.tomtom.com/

28. Artificial intelligence
Reasoning
Problem
solving
Learning
Creating

29. Specialised AI General AI

30. The Economist, April 12, 2017
http://www.economist.com/news/business/21720675-firm-using-
algorithm-designed-cern-laboratory-how-germanys-otto-uses
Case
German e-retailer
Otto uses artificial
intelligence to make
operational
decisions

31. The Solution (cont.)
• Use an AI to analyse 3 bn
transactions and 200 variables
(past sales, searches on site,
weather etc.)
• The AI foresees future customer
orders and makes procurement
decisions based on these
projections The Economist, April 12, 2017
http://www.economist.com/news/business/21720675-firm-
using-algorithm-designed-cern-laboratory-how-germanys-
otto-uses

32. The Results
• The AI predicts with 90%
accuracy what will be sold within
30 days
• The AI procures around 200 000
items per month
• Returns are diminished by 2
million items per year
• Stock level has been reduced by
20%
• More personel were hired (!)
The Economist, April 12, 2017
http://www.economist.com/news/business/21720675-firm-
using-algorithm-designed-cern-laboratory-how-germanys-
otto-uses

33. Takeaways
• AI used to make existing
processes better
• AI is not only for Amazon and
Google
• This development has just
started…
The Economist, April 12, 2017
http://www.economist.com/news/business/21720675-firm-
using-algorithm-designed-cern-laboratory-how-germanys-
otto-uses

34. Sep 2015
Mar 2017
”Blockchain” ”Blockchain
supply chain”
Just 2 years!
Mar 2014 Sep 2015 Mar 2017
Sep 2017
Sep 2017

35. Bitcoin, bitcoin coin, physical bitcoin, bitcoin photo by Antana on Flickr (CC-BY,SA)
Blockchain
technology
Records transactions and
data among actors that
do not trust each other
Fully
decentralized
Actors that do not trust each other
= your typical supply chain

36. Can be used to answer questions like:
Who owns
something?
What hassomething beenthrough?
Where is
something?
When did a
transaction
occur?

37. Example:
You are looking to buy a new
sweater from a store.
The sweater has a unique QR
code attached.
You scan the code with your
mobile.

38. Blockchain
Asks about this sweater?
The QR code is a
hyperlink that
asks a query of
the relevant
blockchain(s)

39. Blockchain
Asks about this sweater
Product history
?
Source of materials
Name of all sub-suppliers
Carbon footprint
Date of production
The results are presented
in your web browser

41. Per Olof Arnäs, PhD
Chalmers University of Technology
Service Management and Logistics
per-olof.arnas@chalmers.se
about.me/perolofarnas
Slides: slideshare.net/poar
@Dr_PO
OKIMG_5751 by taymtaym on Flickr (CC-BY)
Logistikpodden.se
Eldsjälar
Experter
(Föreslå gärna…)
Some observations
regarding the
digital future
of transportation