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- 1. Connected World: HyperconnectedTravel and Transport in Action World Economic Forum – BCG collaboration project May 2014
- 2. Connected World Slideshare_BCGformat_23May14_JL.pptx 1 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. Connected world: what will travel & transport look like in 2025 What are the key challenges and cross-industry opportunities? 2012 – Megatrends & defining solutions 2013 – Detailing of all solutions 2014 – Pilots & kick-off SDV ACIS IPITA Solution landscapes Operating models Roadmaps Advisory Board Call Connected World10 June 2013-vF.pptx 16 "Efficientinfrastructure":Infrastructureto befundedand operated privately User Shares revenues — Subway/Bus/Car-sharing3 — Parkinggarageoperators — Roadoperators:toll/fastlane Infrastructureoperators2 Provide: — Public transportation — Parkingspace — Fastlane access — Tollroaduse City Transfers asset ownership4 Provides political framework COMEToperator1 Funds installation andservice Transmits: — Traffic data(e.g., speed, conges- tioninfo) through smart phone apps/ OEM telematics — Parking spotinfo Provides directreal- timeinfo (e.g.,via text msg., in-car alerts) 1. Includes sensor/signage infrastructure 2. Role of REIT is to own infrastructure; Operators to run daily operations; REIT can be PPP 3. Operators w/o sufficient revenues can be funded by city 4. Transaction can either be sale or lease contract Note: Only key players included in business model. Various extensions conceivable. Source: World Economic Forum/BCG analysis/IP NY workshop participants Real-Estate InvestmentTrust (REIT)2 Paysfor assets Operationalphase Brief description — Citysells selected relevantassets, e.g.roads, to REIT — REITefficientlymanagestransferred assets and fundsother needed infrastructureupgrades — Citycreates politicalframework/ guidelinesforoperationof COMET operator,infrastructureoperators, andREIT — COMEToperator receivesand analyzestrafficdata fromusers and infrastructureoperatorsas well as otherexternalsources — COMEToperator controls infrastructureoperationsaccordingto trafficdata — Users pay COMEToperator for services,e.g.,publictransportation, parkingspace, fastlaneaccess and tollroad use — Telcosprovidedata transmission servicesand handle payment/billing interfaceto users — COMEToperator shares revenues withinfrastructureoperators and REIT Setsup operatorfor formercity assets/ Funds operators Set-upphase Exchange userdata and real-time information FinancialMarkets Provide financing Sells shares Workshop result IP NY Provides political framework Telcos (datatransmission and billingservices) Paysfor: — Fast lane/toll roaduse — Parking spaces Controls: — Dynamictoll rates — Signage/signaling — Accessrestrictions Providespoliticalframework FulfillSLAs FulfillsSLAs Shares revenues Cashflows Service/informationflows Relationshipsshown: Advisory Board Call Connected World10 June 2013-vF.pptx 16 COMETroadmapconsistsof fourphases,expanding scopeand functionalitiesover time Launch toll road nucleus Expand to active steering Complete service portfolio 1 32 Source: World Economic Forum/BCG analysis Today 2025 Fully enable COMET Functionality scope Transparencyfor users Active traffic steering(incl. recommendationsand access restrictions) Active traffic steering Trafficsteering andunified paymentprovision 4 Asset scope Key tollroads operatedby REIT Signageinstalled, publictransport included Parkingincluded Tollroads, signage, pub.transport, parking Data collection infrastructure Floatingcar data Floatingcar data Add'lsensors whereneeded (e.g.,parking) Floatingcar data andsensors where needed Responsibilities of REIT/public authorities Publicauthorit. (PA) run most operationalissues; REITonly tollroads REITinvestmentin sign.,PA provide pub.transport data& directact. steering REITinvestment insensorsand parking,approval byPA Fullengagement ofREIT,PAs in supervisoryrole (andcontrol public transport) Exampleroadmap– alternativespossible Draft– fordiscussion only Benefitsfor... Transparencyover traffic situation Activerecommendations,incl. linktopublictransport Smartparkingfeatures (availability,reservation,etc.) Simplepaymentsthrough oneunifiedsystem Users Opportunityto profitablyrun tollroads Opportunityto op. add'l roads andsignageinfrastructure Opportunityto monetizesmart parking(e.g. dynamicpricing) Add'l revenue andefficiency throughunifiedpayments Companies Efficientlyoperated toll roads, lessoperationalresponsibility Lower congestiondue to activesteering andabilityto leveragetrafficdata Added transparencyover parkingusage and better utilizationofparkingspaces Fulltransparencyover transportsystem,no more operationalburden City Advisory Board Call Connected World10 June 2013-vF.pptx 16 Rio de Janeiro Initial traffic management systems established, but substantial room for improvement to reach COMET value proposition Selectedexamples of advanced projects Real-timemonitoring Real-timeanalytics Intelligent steering Dynamic tolling Smart parking Accessrestriction System focusingon trafficsteering to reduce congestion; nosmart parking component System with advanced analytics capabilitiesto steertraffic, butno tolling andparking capabilities Comparably strong analytics,but largely human- powered;no dynamic tollingor smart parking Source: ITS; roadtraffic-technology.com; IBM; Rio de Janeiro; NY Times; Singapore Ministry of Transport; U.S. Department of Transport; World Economic Forum/BCG analysis Degree of fulfillmentof COMETcharacteristics Dynamic tollingsystem to smoothen trafficflows, butno advanced analytics capabilities Hong Kong Zhenjiang Singapore Advisory Board Call Connected World10 June 2013-vF.pptx 16 "Efficientinfrastructure":Infrastructureto befundedand operated privately User Shares revenues — Subway/Bus/Car-sharing3 — Parkinggarageoperators — Roadoperators:toll/fastlane Infrastructureoperators2 Provide: — Public transportation — Parkingspace — Fastlane access — Tollroaduse City Transfers asset ownership4 Provides political framework COMEToperator1 Funds installation andservice Transmits: — Traffic data(e.g., speed, conges- tioninfo) through smart phone apps/ OEM telematics — Parking spotinfo Provides directreal- timeinfo (e.g.,via text msg., in-car alerts) 1. Includes sensor/signage infrastructure 2. Role of REIT is to own infrastructure; Operators to run daily operations; REIT can be PPP 3. Operators w/o sufficient revenues can be funded by city 4. Transaction can either be sale or lease contract Note: Only key players included in business model. Various extensions conceivable. Source: World Economic Forum/BCG analysis/IP NY workshop participants Real-Estate InvestmentTrust (REIT)2 Paysfor assets Operationalphase Brief description — Citysells selected relevantassets, e.g.roads, to REIT — REITefficientlymanagestransferred assets and fundsother needed infrastructureupgrades — Citycreates politicalframework/ guidelinesforoperationof COMET operator,infrastructureoperators, andREIT — COMEToperator receivesand analyzestrafficdata fromusers and infrastructureoperatorsas well as otherexternalsources — COMEToperator controls infrastructureoperationsaccordingto trafficdata — Users pay COMEToperator for services,e.g.,publictransportation, parkingspace, fastlaneaccess and tollroad use — Telcosprovidedata transmission servicesand handle payment/billing interfaceto users — COMEToperator shares revenues withinfrastructureoperators and REIT Setsup operatorfor formercity assets/ Funds operators Set-upphase Exchange userdata and real-time information FinancialMarkets Provide financing Sells shares Workshop result IP NY Provides political framework Telcos (datatransmission and billingservices) Paysfor: — Fast lane/toll roaduse — Parking spaces Controls: — Dynamictoll rates — Signage/signaling — Accessrestrictions Providespoliticalframework FulfillSLAs FulfillsSLAs Shares revenues Cashflows Service/informationflows Relationshipsshown: Advisory Board Call Connected World10 June 2013-vF.pptx 16 COMETroadmapconsistsof fourphases,expanding scopeand functionalitiesover time Launch toll road nucleus Expand to active steering Complete service portfolio 1 32 Source: World Economic Forum/BCG analysis Today 2025 Fully enable COMET Functionality scope Transparencyfor users Active traffic steering(incl. recommendationsand access restrictions) Active traffic steering Trafficsteering andunified paymentprovision 4 Asset scope Key tollroads operatedby REIT Signageinstalled, publictransport included Parkingincluded Tollroads, signage, pub.transport, parking Data collection infrastructure Floatingcar data Floatingcar data Add'lsensors whereneeded (e.g.,parking) Floatingcar data andsensors where needed Responsibilities of REIT/public authorities Publicauthorit. (PA) run most operationalissues; REITonly tollroads REITinvestmentin sign.,PA provide pub.transport data& directact. steering REITinvestment insensorsand parking,approval byPA Fullengagement ofREIT,PAs in supervisoryrole (andcontrol public transport) Exampleroadmap– alternativespossible Draft– fordiscussion only Benefitsfor... Transparencyover traffic situation Activerecommendations,incl. linktopublictransport Smartparkingfeatures (availability,reservation,etc.) Simplepaymentsthrough oneunifiedsystem Users Opportunityto profitablyrun tollroads Opportunityto op. add'l roads andsignageinfrastructure Opportunityto monetizesmart parking(e.g. dynamicpricing) Add'l revenue andefficiency throughunifiedpayments Companies Efficientlyoperated toll roads, lessoperationalresponsibility Lower congestiondue to activesteering andabilityto leveragetrafficdata Added transparencyover parkingusage and better utilizationofparkingspaces Fulltransparencyover transportsystem,no more operationalburden City Advisory Board Call Connected World10 June 2013-vF.pptx 16 Rio de Janeiro Initial traffic management systems established, but substantial room for improvement to reach COMET value proposition Selectedexamples of advanced projects Real-timemonitoring Real-timeanalytics Intelligent steering Dynamic tolling Smart parking Accessrestriction System focusingon trafficsteering to reduce congestion; nosmart parking component System with advanced analytics capabilitiesto steertraffic, butno tolling andparking capabilities Comparably strong analytics,but largely human- powered;no dynamic tollingor smart parking Source: ITS; roadtraffic-technology.com; IBM; Rio de Janeiro; NY Times; Singapore Ministry of Transport; U.S. Department of Transport; World Economic Forum/BCG analysis Degree of fulfillmentof COMETcharacteristics Dynamic tollingsystem to smoothen trafficflows, butno advanced analytics capabilities Hong Kong Zhenjiang Singapore Advisory Board Call Connected World10 June 2013-vF.pptx 16 "Efficientinfrastructure":Infrastructureto befundedand operated privately User Shares revenues — Subway/Bus/Car-sharing3 — Parkinggarageoperators — Roadoperators:toll/fastlane Infrastructureoperators2 Provide: — Public transportation — Parkingspace — Fastlane access — Tollroaduse City Transfers asset ownership4 Provides political framework COMEToperator1 Funds installation andservice Transmits: — Traffic data(e.g., speed, conges- tioninfo) through smart phone apps/ OEM telematics — Parking spotinfo Provides directreal- timeinfo (e.g.,via text msg., in-car alerts) 1. Includes sensor/signage infrastructure 2. Role of REIT is to own infrastructure; Operators to run daily operations; REIT can be PPP 3. Operators w/o sufficient revenues can be funded by city 4. Transaction can either be sale or lease contract Note: Only key players included in business model. Various extensions conceivable. Source: World Economic Forum/BCG analysis/IP NY workshop participants Real-Estate InvestmentTrust (REIT)2 Paysfor assets Operationalphase Brief description — Citysells selected relevantassets, e.g.roads, to REIT — REITefficientlymanagestransferred assets and fundsother needed infrastructureupgrades — Citycreates politicalframework/ guidelinesforoperationof COMET operator,infrastructureoperators, andREIT — COMEToperator receivesand analyzestrafficdata fromusers and infrastructureoperatorsas well as otherexternalsources — COMEToperator controls infrastructureoperationsaccordingto trafficdata — Users pay COMEToperator for services,e.g.,publictransportation, parkingspace, fastlaneaccess and tollroad use — Telcosprovidedata transmission servicesand handle payment/billing interfaceto users — COMEToperator shares revenues withinfrastructureoperators and REIT Setsup operatorfor formercity assets/ Funds operators Set-upphase Exchange userdata and real-time information FinancialMarkets Provide financing Sells shares Workshop result IP NY Provides political framework Telcos (datatransmission and billingservices) Paysfor: — Fast lane/toll roaduse — Parking spaces Controls: — Dynamictoll rates — Signage/signaling — Accessrestrictions Providespoliticalframework FulfillSLAs FulfillsSLAs Shares revenues Cashflows Service/informationflows Relationshipsshown: Advisory Board Call Connected World10 June 2013-vF.pptx 16 COMETroadmapconsistsof fourphases,expanding scopeand functionalitiesover time Launch toll road nucleus Expand to active steering Complete service portfolio 1 32 Source: World Economic Forum/BCG analysis Today 2025 Fully enable COMET Functionality scope Transparencyfor users Active traffic steering(incl. recommendationsand access restrictions) Active traffic steering Trafficsteering andunified paymentprovision 4 Asset scope Key tollroads operatedby REIT Signageinstalled, publictransport included Parkingincluded Tollroads, signage, pub.transport, parking Data collection infrastructure Floatingcar data Floatingcar data Add'lsensors whereneeded (e.g.,parking) Floatingcar data andsensors where needed Responsibilities of REIT/public authorities Publicauthorit. (PA) run most operationalissues; REITonly tollroads REITinvestmentin sign.,PA provide pub.transport data& directact. steering REITinvestment insensorsand parking,approval byPA Fullengagement ofREIT,PAs in supervisoryrole (andcontrol public transport) Exampleroadmap– alternativespossible Draft– fordiscussion only Benefitsfor... Transparencyover traffic situation Activerecommendations,incl. linktopublictransport Smartparkingfeatures (availability,reservation,etc.) Simplepaymentsthrough oneunifiedsystem Users Opportunityto profitablyrun tollroads Opportunityto op. add'l roads andsignageinfrastructure Opportunityto monetizesmart parking(e.g. dynamicpricing) Add'l revenue andefficiency throughunifiedpayments Companies Efficientlyoperated toll roads, lessoperationalresponsibility Lower congestiondue to activesteering andabilityto leveragetrafficdata Added transparencyover parkingusage and better utilizationofparkingspaces Fulltransparencyover transportsystem,no more operationalburden City Advisory Board Call Connected World10 June 2013-vF.pptx 16 Rio de Janeiro Initial traffic management systems established, but substantial room for improvement to reach COMET value proposition Selectedexamples of advanced projects Real-timemonitoring Real-timeanalytics Intelligent steering Dynamic tolling Smart parking Accessrestriction System focusingon trafficsteering to reduce congestion; nosmart parking component System with advanced analytics capabilitiesto steertraffic, butno tolling andparking capabilities Comparably strong analytics,but largely human- powered;no dynamic tollingor smart parking Source: ITS; roadtraffic-technology.com; IBM; Rio de Janeiro; NY Times; Singapore Ministry of Transport; U.S. Department of Transport; World Economic Forum/BCG analysis Degree of fulfillmentof COMETcharacteristics Dynamic tollingsystem to smoothen trafficflows, butno advanced analytics capabilities Hong Kong Zhenjiang Singapore Advisory Board Call Connected World10 June 2013-vF.pptx 16 "Efficientinfrastructure":Infrastructureto befundedand operated privately User Shares revenues — Subway/Bus/Car-sharing3 — Parkinggarageoperators — Roadoperators:toll/fastlane Infrastructureoperators2 Provide: — Public transportation — Parkingspace — Fastlane access — Tollroaduse City Transfers asset ownership4 Provides political framework COMEToperator1 Funds installation andservice Transmits: — Traffic data(e.g., speed, conges- tioninfo) through smart phone apps/ OEM telematics — Parking spotinfo Provides directreal- timeinfo (e.g.,via text msg., in-car alerts) 1. Includes sensor/signage infrastructure 2. Role of REIT is to own infrastructure; Operators to run daily operations; REIT can be PPP 3. Operators w/o sufficient revenues can be funded by city 4. Transaction can either be sale or lease contract Note: Only key players included in business model. Various extensions conceivable. Source: World Economic Forum/BCG analysis/IP NY workshop participants Real-Estate InvestmentTrust (REIT)2 Paysfor assets Operationalphase Brief description — Citysells selected relevantassets, e.g.roads, to REIT — REITefficientlymanagestransferred assets and fundsother needed infrastructureupgrades — Citycreates politicalframework/ guidelinesforoperationof COMET operator,infrastructureoperators, andREIT — COMEToperator receivesand analyzestrafficdata fromusers and infrastructureoperatorsas well as otherexternalsources — COMEToperator controls infrastructureoperationsaccordingto trafficdata — Users pay COMEToperator for services,e.g.,publictransportation, parkingspace, fastlaneaccess and tollroad use — Telcosprovidedata transmission servicesand handle payment/billing interfaceto users — COMEToperator shares revenues withinfrastructureoperators and REIT Setsup operatorfor formercity assets/ Funds operators Set-upphase Exchange userdata and real-time information FinancialMarkets Provide financing Sells shares Workshop result IP NY Provides political framework Telcos (datatransmission and billingservices) Paysfor: — Fast lane/toll roaduse — Parking spaces Controls: — Dynamictoll rates — Signage/signaling — Accessrestrictions Providespoliticalframework FulfillSLAs FulfillsSLAs Shares revenues Cashflows Service/informationflows Relationshipsshown: Advisory Board Call Connected World10 June 2013-vF.pptx 16 COMETroadmapconsistsof fourphases,expanding scopeand functionalitiesover time Launch toll road nucleus Expand to active steering Complete service portfolio 1 32 Source: World Economic Forum/BCG analysis Today 2025 Fully enable COMET Functionality scope Transparencyfor users Active traffic steering(incl. recommendationsand access restrictions) Active traffic steering Trafficsteering andunified paymentprovision 4 Asset scope Key tollroads operatedby REIT Signageinstalled, publictransport included Parkingincluded Tollroads, signage, pub.transport, parking Data collection infrastructure Floatingcar data Floatingcar data Add'lsensors whereneeded (e.g.,parking) Floatingcar data andsensors where needed Responsibilities of REIT/public authorities Publicauthorit. (PA) run most operationalissues; REITonly tollroads REITinvestmentin sign.,PA provide pub.transport data& directact. steering REITinvestment insensorsand parking,approval byPA Fullengagement ofREIT,PAs in supervisoryrole (andcontrol public transport) Exampleroadmap– alternativespossible Draft– fordiscussion only Benefitsfor... Transparencyover traffic situation Activerecommendations,incl. linktopublictransport Smartparkingfeatures (availability,reservation,etc.) Simplepaymentsthrough oneunifiedsystem Users Opportunityto profitablyrun tollroads Opportunityto op. add'l roads andsignageinfrastructure Opportunityto monetizesmart parking(e.g. dynamicpricing) Add'l revenue andefficiency throughunifiedpayments Companies Efficientlyoperated toll roads, lessoperationalresponsibility Lower congestiondue to activesteering andabilityto leveragetrafficdata Added transparencyover parkingusage and better utilizationofparkingspaces Fulltransparencyover transportsystem,no more operationalburden City Advisory Board Call Connected World10 June 2013-vF.pptx 16 Rio de Janeiro Initial traffic management systems established, but substantial room for improvement to reach COMET value proposition Selectedexamples of advanced projects Real-timemonitoring Real-timeanalytics Intelligent steering Dynamic tolling Smart parking Accessrestriction System focusingon trafficsteering to reduce congestion; nosmart parking component System with advanced analytics capabilitiesto steertraffic, butno tolling andparking capabilities Comparably strong analytics,but largely human- powered;no dynamic tollingor smart parking Source: ITS; roadtraffic-technology.com; IBM; Rio de Janeiro; NY Times; Singapore Ministry of Transport; U.S. Department of Transport; World Economic Forum/BCG analysis Degree of fulfillmentof COMETcharacteristics Dynamic tollingsystem to smoothen trafficflows, butno advanced analytics capabilities Hong Kong Zhenjiang Singapore COMET Develop pilot solutions Develop Self-driving vehicles (SDV) topic Condition-based megacity traffic management (COMET) Integrated proactive intermodal travel assistant (IPITA) Automated check- in, security, border control (ACIS) Transparency and traceability for logistics optimization (TATLO) Megatrends (e.g., energy, aging, mega-cities) Long list of solutions identified... Scenarios (e.g., New Balance, Mind the Gap) ... prioritized based on business and societal potential 1. Megatrends less understood regarding implications on the travel and transport ecosystem, exemplary blind spots from Task Force survey 2. Information and communication technology
- 3. Connected World Slideshare_BCGformat_23May14_JL.pptx 2 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. Advisory Board Task force of over 40 companies Aviation Other experts Rail IT/Telco Logistics Hospitality Automotive- - Connected World brings together senior executives from transport, travel, logistics and technology Rupert Stadler Chairman of BOM, AUDI Ken Hu Deputy Chairman, Huawei Luis Alvarez CEO, BT Global Services Jean-Paul Herteman Chairman & CEO, Safran M. Georgiadis President of Americas Operations, Google Tarek Sultan Chairman and Mgmt Director, Agility
- 4. Connected World Slideshare_BCGformat_23May14_JL.pptx 3 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. Agenda Mobility megatrends and 2025 scenarios Transformative solutions Conclusions and next steps
- 5. Connected World Slideshare_BCGformat_23May14_JL.pptx 4 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. 9.8% A megatrend can be defined as an exponential wave that fundamentally re-shifts the competitive landscape Inexorable growth that challenges surrounding resources and systems Cross-industry trend affecting numerous businesses and geographies in a significant way1 A structural shift Relevant to business Likely to play out over the next 5 to 10 years 1.9 ’09 1.6 ’07 1.2 ’05 0.9 ’03 0.7 ’01 ’15e 2.4 0.5 ’99 0.3 ’97 0.1 ’95 0.0 ’93 0.0 ’91 0.0 2.2 1.5 1.0 0.5 ’11 0.0 ’13e CAGR +30% Global Internet users (billion) 2.5 2.0 ME and Africa Other Latin America Europe Asia and Australia North America 8.0% 2.2% 1.2% 8.4% CAGR 2011–15 A sustainable growing movement with global and significant impact … … based on reliable underlying data Example 10.5% 1. Specific Megatrends, as rise of India or China, may be regional in themselves, but their impact is always global Source: Graph: EIU market data
- 6. Connected World Slideshare_BCGformat_23May14_JL.pptx 5 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. Twenty megatrends selected for their impact on the mobility ecosystem Changing Customer Needs New Mobility Frontiers New Technology Vectors Key Capabilities for the Future Seamless User Experience New ChallengersInnovation ImperativeCustomizationSupply-Chain Agility Social Media/Web 2.0Mobile Connectivity 3.0 E-/M-Commerce & Multichannel Retail Cloud Solutions/ Big Data Analytics Information & Enter- tainment Everywhere Environmental ConcernsRisk & Security Challenges Energy Scarcity & Price Evolution The Infrastructure Challenge Internet of Things/ Smart Transport Further GlobalizationShift to Rapidly Developing Economies Aging Population More Convenience & Time Compression Emergence of Megacities
- 7. Connected World Slideshare_BCGformat_23May14_JL.pptx 6 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. We then built upon trend analysis to develop four variables Scenario variables must be vivid and distinct to be a good focus for brainstorming — What is the holiday's itinerary, in terms of destination and mode of transportation? — What does the end-to-end travel process look like? — How did the family decide where to go and what to do? — How is technology engaged before, during and after the trip? — What does the journey look like for the mango: origin, modes of transportation etc.? — How does sustainability play a role? — What are the selection criteria for this specific mango? — What are the logistical challenges? — How does the consumer inform about this product, how are groceries done? — How will the working society look like? — What are the different ways to arrive at work, what are the selection criteria? — What will the journey to work look like, what is it like to get around in Mumbai? — What role will technological innovations play in the daily commute? — How does this link to working life? — Who called the meeting and what is the agenda? Who attends? — What is the tone of the meeting, what is the general atmosphere? — What is the competitive context? — Which role has the end user? — What decisions/next steps arise from the meeting? Vignette 1: A Scandinavian family's two week holiday beyond 2025 Vignette 3: The journey of a mango to a French dinner table beyond 2025 Vignette 2: The morning routine of a Tata employee in Mumbai beyond 2025 Vignette 4: A crisis HR meeting at Google's headquarters beyond 2025
- 8. Connected World Slideshare_BCGformat_23May14_JL.pptx 7 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. And created hypotheses on the future of travel, transportation and the broader world that were combined to build scenarios Scenario 3 Mind the Gap Scenario 1 Green Awareness Scenario 4 Local is King Scenario 2 Maximized Growth Patterns for suggested scenarios Hypotheses Journey is vacation Flex work Amazon mango Mixed purpose Transparent mango Brainiac Staycation Ch(inag)oogle Local mango Geetha Flue(goo)gle 24h life Total customization War for Talent Relocation plan WW3 Discussion Vignettes Scandinavian family vacation beyond 2025 Morning routine of Tata employee in Mumbai beyond 2025 Journey of a mango to a French dinner table beyond 2025 Crisis HR meeting at Google HQ beyond 2025 1 2 3 4
- 9. Connected World Slideshare_BCGformat_23May14_JL.pptx 8 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. 2025 scenarios to imagine and prepare for potential futures and changing demand for mobility products/services #I New Balance #III Mind the Gap #II Maxi- mized Growth #IV Local is King
- 10. Connected World Slideshare_BCGformat_23May14_JL.pptx 9 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. Scenario I: New balance 1. Definition by World Business Council for Sustainable Development: Preserving the natural environment, meeting the travel needs of the population, supporting a good economy, minimizing infrastructure costs, maintaining energy security, ensuring long-term viability of the transport system The following drivers changed the world — The world experienced a growing number of natural disasters — Middle class has grown dramatically by rising education levels, at the same time community sense is rising — A green revolution driven by RDEs impacted world politics and society, most countries obey Kyoto II and III — A new wearable data device with neural link to its owner revolutionized information processing and communication for everyone (enabled by data privacy norms and trust in cloud solutions) — High investments in extensive public transportation infrastructure The scenario is characterized as "Green" and "Sustainable"1 — Carbon-pricing regulations almost everywhere — Companies incented based on societal values (environment, education, etc.), and societal costs are priced into goods/services (products carry data tag with carbon footprint, etc.) — New green technologies contribute to saving CO2 emissions — Transparent information and new communication tools enable to efficiently take environmentally conscious decisions and to switch between different means of green transport — A new, more balanced, healthy lifestyle gains worldwide popularity — The world is more decentralized: Fruit/vegetables come from sustainable greenhouses in all climates, local production experiences a renaissance by 3D printing — Holidays are more often local and business travel frequently substituted by virtual reality Backup
- 11. Connected World Slideshare_BCGformat_23May14_JL.pptx 10 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. Scenario II: Maximized Growth The scenario is characterized as efficient and prioritizing economic objectives — Economic drivers of core interest, the society is individualistic and status- oriented — The environment is suffering increased pollution levels, esp. around megacities, on the other hand it is cheaper than ever before to travel far away to reach green escapes — Climate change is leading to migration streams away from adversely affected areas — Travel has wide mix of purposes: vacation, work, study, and medical treatment often combined — ICT-driven start-ups arise with cloud solutions, social media, and big data, which, e.g., provide automated booking of wishes not even expressed yet. People and goods are tracked electronically everywhere. The following drivers changed the world — Global trade volumes highly increased, World Travel and Trade Treaty of 2020 made borders almost meaningless — Politics focusing on economic growth, standardizations facilitate interconnectivity and intermodal transport — A spurt of inventions has led to a new era of efficiency and automation, e.g., in fuel efficiency and ICT solutions — Secure Internet/Cloud solutions provide seamless e-processes — High public/private investments in efficient infrastructure — In megacities, many people work remote, traffic flows need to be optimized for connected cars — Supply chain efficiency increases by online orders, intermediation, and better matching of supply and demand. Consumers in general pay lower prices Backup
- 12. Connected World Slideshare_BCGformat_23May14_JL.pptx 11 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. Scenario III: Mind the Gap The scenario is characterized by a split society and market — Megacities consist of a "rich" area with advanced infrastructure surrounded by areas with outdated infrastructure — The rich can afford comfortable travel and transportation. But for the masses, urban transportation is a challenge, with a lot of time devoted to working and commuting — For those who can afford, there are huge opportunities for customization and choice, products carry data tags (showing origin, freshness, etc.), but the masses consume cheap, standardized products — Augmented-/virtual reality solutions used by all, but only rich can afford latest technology as personal robots or self-driving cars The following drivers changed the world — The political system has developed towards an autocracy advancing certain population groups — Society split into richer 20% and large lower-income group (80%) — Governments establish basic food, health services, and safety measures to maintain stability — Rising energy prices limit individual mobility of lower-income class — Infrastructure investments followed interests of wealthier tax payers — RDEs continue to gain power at the expense of former "first world" countries (China just acquired Google) Backup
- 13. Connected World Slideshare_BCGformat_23May14_JL.pptx 12 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. Scenario IV: Local is King The scenario is characterized as focusing on local travel and trade and establishing control — Preference of regional products and services — Local focus results in broad variety of industries in each country, large nations get almost self-sustainable — Countries use protectionism, border crossing is time-consuming and expensive — Government-steered companies gain importance — Extensive control mechanisms and security checks hinder efficient travel and transportation — Internet usage and social networks experience sharp decline, ICT investments drop, high security measures (firewalls everywhere, migration of public to more isolated private clouds) — Many megacities are transportation disasters with a struggling economy The following drivers changed the world — Cyber attacks, regional conflicts, and another bird flu affected the world and led to a new recession and globalization concerns — Trust in Internet solutions is lost due to hacking and manipulation — The by then highly popular driverless cars have been hacked in 2023, deadly crashes resulted in a ban from streets — Worldwide rising oil prices drive transport costs — Reduction of worldwide wage arbitrage effects as RDEs have caught up regarding wages — Economic recession led to cuts in public infrastructure spending Backup
- 14. Connected World Slideshare_BCGformat_23May14_JL.pptx 13 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. Agenda Mobility megatrends and 2025 scenarios Transformative solutions Conclusions and next steps
- 15. Connected World Slideshare_BCGformat_23May14_JL.pptx 14 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. 4 cross-industry solution ideas were prioritized from the long list created in the scenarios >100 Cross- industry Strong ICT component Prioritization 33 25 4 Sector call results Prioritized solution ideas Prioritized based on business opportunity and benefits to society
- 16. Connected World Slideshare_BCGformat_23May14_JL.pptx 15 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. 2 3 2 543 5 4 Vehicle operator and passenger health analytics Preventive vehicle mainte- nance & safety systems Logistic drones Tracking & transparency based logistic optimizer (TATLO) Driverless swarm cars service Business opportunity Benefits to society Integrated intermodal mobility provider Condition based megacity traffic management (COMET) Holographic communi- cations platforms Mobile living room and virtual office Fully automated check-in, security, border control (ACIS) Mobile pop-up hotels Integrated proactive inter- modal travel assistant (IPITA) Four solution ideas were selected for further research based on input from task force Lowest ranked solution Top ranked solutions Medium ranked solutions Note: n= 35 Source: Connected World Task Force Survey on solution ideas, November 2012
- 17. Connected World Slideshare_BCGformat_23May14_JL.pptx 16 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. ACIS: How to make immigration and airport operations safer and more comfortable Illustrated for the World Economic Forum by the ValueWeb
- 18. Connected World Slideshare_BCGformat_23May14_JL.pptx 17 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. ACIS: Clear benefits for travelers and governments Travelers have access to smoother visa application and customer experience at airports Customs and border control can operate more efficiently by focusing only on high risk- individuals Tourism agencies can attract larger numbers of travelers ICT firms can build business around selling the required hardware and software Value proposition Storing and processing personal data — Clear guidelines on sharing and storing data — Initially an opt-in process where people accept sharing data in exchange for smoother travel — People with right to access their data Standardizing online processes — Starting with national databases and systems that can be integrated on regional leveel — Using trading blocs (ASEAN, NAFTA etc.) as the basis Cost of investment — Build the system gradually — Introduce features first as a premium service paid by e.g. service fees Key challenges and solutions
- 19. Connected World Slideshare_BCGformat_23May14_JL.pptx 18 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. Traveller (or company) Pays smart visa application fee Visa and PAIP processor Submits smart visa application/biometric info International database operator National database operator Shares for installation and service National immigration Funds and maintains Defines smart visa application rules Checks and updates applicant's travel/visa history Shares fees Grants/denies smart visa and PAIP application Checks PAIP access applicability of traveller Interpol/ Europol Checks Risk classification database Applicant's travel/visa history; deposits smart visa and biometric information Provides PAIP access Checks Cash flows Service/information flows Relationships shown: ACIS: How would the visa process operate Note: PAIP = Preapproved immigration programme Source: World Economic Forum/The Boston Consulting Group analysis
- 20. Connected World Slideshare_BCGformat_23May14_JL.pptx 19 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. International smart visa database operator Traveller (or company) Security operator Airlines/ airline alliances Airport operator Risk classification database Submits personal information Provides preferred service Transmits data & risk classification Pays usage fee Provides risk classification Pays ticket and preferred service Forwards screening and check-in information Pays for service Provides hardware Pays for service Cash flows Service/information flows Relationships shown: ACIS: How would the airport operate Source: World Economic Forum/The Boston Consulting Group analysis
- 21. Connected World Slideshare_BCGformat_23May14_JL.pptx 20 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. COMET: How to better control city traffic Illustrated for the World Economic Forum by the ValueWeb
- 22. Connected World Slideshare_BCGformat_23May14_JL.pptx 21 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. COMET: $2-10B benefits for a megacity $2-10B benefits over 10 years per city 400M less hours spent in traffic 40,000 accidents prevented 2M tons reduction in CO2 emissions 200M gallons reduction in fuel consumption Value proposition Creating the public-private partnership model — Define financial & operational metrics in the SLA — Transparent implementation process with costs and benefits communicated clearly Managing traffic data effectively and safely — Guidelines on storing and sharing data — Not storing PII1 data Cost of investment — Build the system gradually — Start with low-cost, high benefit features such as smart parking Key challenges and solutions 1. Personally identifiable data
- 23. Connected World Slideshare_BCGformat_23May14_JL.pptx 22 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. COMET: How would it operate? Installation and service funding Traffic updates Payment for assets Political framework Payment for services Political framework and asset ownership Control systemInformation Political framework Shares revenues Shares revenues Provide services Cash flows Service/information flows Relationships shown: User Public authority (e.g. city) Infra- structure fund COMET operator Infra provider Source: World Economic Forum/The Boston Consulting Group analysis
- 24. Connected World Slideshare_BCGformat_23May14_JL.pptx 23 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. IPITA : Smoother international travel Illustrated for the World Economic Forum by the ValueWeb
- 25. Connected World Slideshare_BCGformat_23May14_JL.pptx 24 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. IPITA: clear benefits for travelers and travel industry Travelers can travel easier, faster and at lower cost Tourism destinations can attract larger audiences Travel and hospitality operators can target their audiences better and attract larger share of traveler spending Technology firms can generate new business by operating the infrastructure and software required Value proposition Getting access to required data — Incentives needed for transport providers and others to provide data — Standardized formats needed to aggregate data easily Protection of private data — Personal data need to be stored at front-end — Data to be stored nationally / regionally with clear conventions on storage & sharing Avoiding monopolistic situation — IPITA back-end doing only data aggregation — Multiple, competing front-ends with access to same data Key challenges and solutions
- 26. Connected World Slideshare_BCGformat_23May14_JL.pptx 25 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. IPITA : How would it operate? Real-time capacity and price information Booking confirmations Bookings/reservations and customer information Share of payments Personal details and preferences, service and booking requests IPITA service, bookings and advertising content Real-time data Pay fees Pays for bookings Transport- ation providers Service providers IPITA back end IPITA front ends Payment platform Traveler (or company) Data providers Source: World Economic Forum/The Boston Consulting Group analysis
- 27. Connected World Slideshare_BCGformat_23May14_JL.pptx 26 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. TATLO: The fully digital supply chain Illustrated for the World Economic Forum by the ValueWeb
- 28. Connected World Slideshare_BCGformat_23May14_JL.pptx 27 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. TATLO: Clear benefits through supply chain Shippers can send and receive goods faster and cheaper with better transparency through the process Transport providers can benefit from lower costs and larger volumes of traffic Public authorities would have higher transparency into trade flows and higher efficiency of customs operations Technology firms can generate new business by providing the infrastructure and software required to operate the system Value proposition Cooperation within industry and duplicate inititatives — Bring together key stakeholders to consolidate views and — Align on required specifications and standards Regulation and standardization — Select suitable standard: Choose new standard, use existing standard or adjust existing standard — Communicate chosen solution comprehensively Insufficient funding and lack of infrastructure — Suggest funding options — Monitor implementation to avoid freeriding Key challenges and solutions
- 29. Connected World Slideshare_BCGformat_23May14_JL.pptx 28 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. Consignor /shipper Nat'l government authorities/ customs agencies Consignee/ buyer Freight forwarder/3PL1 Freight forwarder/3PL1 Freight forwarders/ 3PL1 Single window Relationships shown: Service/information flows Flow of goods Cash flows End Customer Carriers Single window Purchases goods Updates on order size, shipping status Purchases good(s) Updates on shipping status, delivery date Pays for transportation service Pays for transportation service Pays access fee Pays access fee Updates on shipping status, delivery point of time Updates on shipping status, delivery time Continuous information flow to enable smooth movement of goods Paperless information flow Paperless information flow TATLO: How would it operate 1. Third-party logistics provider Source: World Economic Forum/The Boston Consulting Group analysis Nat'l government authorities/ customs agencies
- 30. Connected World Slideshare_BCGformat_23May14_JL.pptx 29 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. Agenda Mobility megatrends and 2025 scenarios Transformative solutions Conclusions and next steps
- 31. Connected World Slideshare_BCGformat_23May14_JL.pptx 30 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. Stakeholder management, role of technology and data emerge as common recommendations Technology only part of solution Most of the technology for the solutions is in place — Main challenge lies in bringing the pieces together and creating a sustainable business model — Most benefits come from using existing technology in new ways Trade-off between availability and security of data Data needs to be both available and secure — Large part of the benefits come from making data more interchangeable and accessible — To address privacy concerns, users need to know what data is stored and have the ability to access and erase it Public-private partnerships All solutions involve both private and public sector — Successful implementation requires governance model where both parties benefit — Alignment of interests and effective governance needed
- 32. Connected World Slideshare_BCGformat_23May14_JL.pptx 31 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. What's next: Launching pilot implementations of selected solutions and developing self-driving vehicles ACIS Facilitate discussions with governments on the benefits of visa restriction removals — The Forum to act as a platform for governments to work together on joint visas and smart visas COMET Initiate discussions with interested cities around the world on COMET — Bring private and public stakeholders around the table — Help to articulate how COMET could look like for their city and what the benefits are IPITA Create consortium interested in implementing IPITA pilot — Both established industry players and new technology start-ups — Bring in interested local or national governments for a pilot discussion Self- driving vehicles (SDV) Develop Self-driving vehicles as an independent topic — Engage with key stakeholders (OEMs, suppliers, insurance and tech firms, governments) — Help to identify obstacles to adoption and formulate industry roadmap Pilotsolutions
- 33. Connected World Slideshare_BCGformat_23May14_JL.pptx 32 Copyright©2014byTheBostonConsultingGroup,Inc.Allrightsreserved. For more information and the full report visit reports.weforum.org/connected-world-2014/ bcg.perspectives Videos on solution spaces • IPITA: Integrated Proactive Intermodal Travel assistant (http://www.youtube.com/watch?v=0MjxiC2pgLE&feature=youtu.be) • COMET: Condition based megacity traffic management (http://www.youtube.com/watch?v=Meh359rr014&feature=youtu.be) • ACIS: Fully automated check-in, security, and border control (http://www.youtube.com/watch?v=hRyv0aLgsxw&feature=youtu.be) • TATLO: Tracking- and transparency-based logistics optimizer (http://www.youtube.com/watch?v=L_PAyvzuHII&feature=youtu.be)
- 34. Thank you bcg.com |bcgperspectives.com