During his inspiration session on Saturday, March 3, Alex Van Breedam will discuss whether the internet giants of today are the logistic businesses of tomorrow. 'Physical Internet' imposes itself as an alternative to the traditional supply chain. The difficult relationship between logistics and society that we know today can create the momentum in which the logistics sector is radically redrawn and in which we make our smart and sustainable director of our regio in this story. Here Alex already explains the importance of that momentum.
Presently, the logistic sector is in trouble and is often singled out as the culprit for a lot of societal disturbance and problems by parties on all sides. The sector is more fragmented than ever, and this has a substantial societal impact. Not only are a vast number of small logistics companies demanding their share of the commodity flow, increasingly small and frequent deliveries are causing a lot of societal inconvenience. Delivery times are becoming increasingly short, foremost under the influence of the dogmas of e-commerce: “next day” or even “same day”.
In a time of growing shortage of capacity – not only in infrastructure but also, for example, in truck drivers – this translates into further fragmentation and dispersion of flows, a growing number of delivery trucks and a paralyzing congestion of our community. With the current business models, all assuming sufficient transport capacity, logistics won’t be able to turn the tide.
A swiftly growing shortage of capacity can only be countered by sharing capacity among multiple shippers, who will have to bundle and consolidate their flows. The solution seems simple: vast flows balanced out in both directions, which will simultaneously minimize transport costs and civic annoyance and maximize frequency. Clusters, bundles, parts and pools are the new code words. The good news is that there’s a growing consensus about the envisioned end result: the Physical Internet, i.e. organizing logistics along the lines of data traffic on the internet. More and more companies, academics and, lately, governments see this as the model for the fair and sustainable logistics of the future.
By providing the right stimuli, the government can facilitate bringing the concepts of the Physical Internet to the logistic sector. Moreover, by making the resolute choice for a new logistic framework, the government will be able to guarantee more sustainability. However, this will oblige the government to take on a more active role to canalize flows more efficiently, and consolidate and bundle them on its territory. Not choosing logistics means that the commodity flows will simply remain unaltered and spread across all directions, resulting in an abundance of societal problems like chaos on our roads. The active role of the government comes in many shapes.
Role of the government
An important starting point is the creation of a level playing field through which a societal disturbance cost is passed on to the consumer. Fees and taxes will prove to be necessary to breach the negative mobility spiral. A level playing field will become a stimulus to make more capacity collectively available, with synchromodality as the ultimate end goal for the cooperation between various modes of transport. Based on an intelligent cluster policy, integrated in a renewed spatial policy, the government can generate a lot of synergies for corporate and societal life by pairing companies with complementary commodity flows and further facilitation through business park management. Going for an integrated and smart approach can generate a win-win for all parties.
When companies and organizations have to cooperate, the information flow becomes crucial. The development of an increasing number of information platforms, intended to better consolidate the disparate flows, paves the way for the Physical Internet. The lack of neutral, confidence-inspiring management or governance models mitigates the current success of these information platforms in logistics. The government can take a leading role in the definition of governance models for public and private data, but also when it comes to standardization, regulation and automation. This has to prevent that information sharing platforms in logistics will eventually be controlled by new monopolists of information flows, namely the current internet giants, who are slowly starting to integrate logistics into their convenience shopping.
The Physical Internet integrates the entire logistic chain. For Flanders this means an integration of everything from harbors as gateways, the Extended Gateways and the hinterland to the so-called last mile. It is clear that harbors will have to take on a more active governing role aligned with the Flemish hinterland to consolidate and channel the import and export flows as much as possible into the synchromodal corridors to minimize societal inconvenience. Through these strong hinterland connections, logistics can also strengthen other industrial sectors.
Perhaps it is the difficult relation between logistics and society today that offers a unique momentum to radically reinvent logistics and turn our region into a smart and sustainable leader of the Physical Internet, with the government taking on an active role to further increase the added value of logistics and industry as much as possible. This can only be achieved if we join forces: the corporate world, the research community and the government engaging in a New Deal for logistics and make the resolute choice for a new logistic framework. If we don’t grab onto the momentum, new actors are already waiting to take over logistics, if need be without us…