Highlights – Mobility Series 1: Innovation defines Mobility

From cars, buses, and trains to flying cars, self-driven taxis, and auto-pods, the future of transportation is rapidly changing. Eleni Kitra (EK), Head of Automotive & Mobility at Meta MENA, Chair of Business Innovators Committee, spoke to Amadou Diallo (AD), Chief Executive Officer at DHL Global Forwarding Middle East & Africa to understand how innovation is impacting business and society.

EK: How would you define mobility?

 AD: Connecting people, improving lives…crossing borders, creating civilization, creating the current world that we live in. The challenges are that we have 700 million people in Southeast Asia, another billion in India, over 600 million in Africa and slightly lower numbers in South America, who all participate in global trade. Therefore, we must create more efficiencies to connect people who are not physically moving, but enable them to move goods, ideas and services around the globe.

EK: DHL used to be a very traditional company, known for moving parcels or boxes from one place to another. Tell us more about the innovation taking place in the company.

 AD: While I was managing the Asia Pacific operations, the Afghanistan war in 2007 broke out and required us to install telecom satellites in Kandahar where there are no roads. So, we were forced to innovate by moving shipments via sea to Dubai, then through Pakistan to Kandahar on donkeys for the last mile journey. Even at present, when we deliver parcels to remote locations in the mountains of Tunisia, and Burkina Faso, we use camels, while in Germany our team is testing drone technology. Our teams really need to know the markets well, because sometimes there are no street names. We must combine creativity with innovation and technology with the reality of our last mile challenges. We have four innovation centers – Singapore, Chicago, Bonn and Dubai. We use drones in Dubai for large inventory stock taking – these fly around the large yards of warehouses, video capture everything and repatriate this into the system, so that no laborious counting is required by humans anymore. We are also using blockchain technology and AI to avoid any human errors.

EK: Should all the hubs be centralized or decentralized in order to provide seamless and frictionless innovation that can be applicable across your organization?

 AD: The small villages even in a mature market like Germany are not as well connected to the Internet compared to some less developed markets of Mumbai or Rwanda where people are moving around in a rickshaw with 4G connectivity. So, I believe that if you mix people from different cultures and communities, you will increase the innovative creativity. Diversity drives more creativity and so you can’t centralize innovation. It is happening everywhere; you just need to be able to understand it and accelerate it.

EK: What are your thoughts on driverless vehicles?

 AD: If technology is utilized wisely, many vehicles can become mobile offices, students can find alternative jobs, and many accidents can be avoided. We are working with a university to create autonomous vehicles for DHL deliveries because we have many traffic jams and lack of parking spaces in most cities. The delivery people can be more efficient and better utilize their time.

EK: What does sustainable logistics mean and the impact that this can have on your business and communities?

 AD: There is a high carbon footprint, in this industry, but we are working towards reducing this. We have approximately 75 million deliveries per day using various types of vehicles. We also have 13.5 million square meters of warehouses for storing all the parcels, and most of these use fossil fuel energy for heating and lighting. We are now working on installing solar panels on all roofs. We also aim to have zero carbon emission by 2050 and are tying biofuels, LNG, and whatever alternatives we can find. Sweden is ahead of other jurisdictions where all our trucks use LNG. We are also looking at electric vehicles, but for this we need charging points everywhere, which are generally not readily available on most highways. We are working to ensure that everywhere we operate, i.e., in the 39,000 offices, that we have electricity charging stations. And finally, we operate 292 planes and are partnering with multiple airlines to work on sustainable fuel. We are working with a startup from whom we have bought 12 electric planes, and if the test is successful, we will increase capacity. Furthermore, we are not doing all this only to be sustainable, but because we find it is better economically, it makes financial sense as well as being better for the environment.

Audience 1: Regarding your sustainability efforts, how is this affecting your relationships and expectations from your vendors?

 AD: Let me give you an example of the impact. We are working with our suppliers in the South of Angola on reforestation projects, with trees that also provide food for the local population. Our target for zero emission would not be possible if the 35% of the commercial airline partnerships we have didn’t also work towards efficiency and alternative energy. When we have 75 million deliveries per day, we obviously have many subcontractors, and we keep track of their carbon emissions too. We are putting 46,000 square meters of solar rooftops here in Dubai as a pilot for the entire region, and now we are replicating the same in South Africa, which helps our suppliers’ business in this industry too.

Audience 2: How do you see the market for carbon credits and what sort of mechanism that’s required to validate these?

 AD: In the logistics industry, we deal with a lot of procurement people, and they are normally not part of any sustainability department. So, the only target they aim for is reduced cost. I think that to drive sustainability, we have an obligation to plant two to three million trees every year, but not because of the carbon credits, but to cultivate the right culture. I think that until carbon credit becomes something that is sustainable, it will need to have the procurement team become part of the sustainability department, and not just as part of the finance department. It will take time, and this is a challenge.

Audience 3: For a logistics and supply chain company, what are your plans regarding single use plastics?

 AD: We recently signed an agreement with a startup in Dubai called Rebound, for reusing plastic waste. We are working towards using recycling and reusing plastic packaging so that no new plastic is being produced. The ESG strategies in our organization is driven by our CFO who strongly believes it will drive our share prices up.