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Transforming Transportation and Logistics with Digitalization

By Peng Zhongyang, Director of Huawei & President of Huawei's Enterprise Business Group

Before the Industrial Age began, prosperous cities often formed around waterways. Yangzhou — a wealthy city in eastern China, located just north of the Yangtze River — is one example. The northeastern Italian city of Venice — comprised of a series of islands, separated by canals and connected by bridges — is another. When the Industrial Age did begin, cities in the US, such as Georgia's capital, Atlanta, emerged at railway intersections. Then, in the 1920s, the construction of Route 66 — one of the country's first highways — boosted the development of many of the nation's inland cities.

Elsewhere and more recently, the development of the aviation industry has enabled somewhere like Dubai to become a transportation hub, boosting the city's importance in the Middle East and, as a result, its prosperity.

Throughout history, we can observe a clear pattern: Transportation and logistics are pivotal, linking global cities and playing a vital role in their development.

And while cities have developed and their transportation and logistics networks have become more sophisticated, digitalization is now permeating the industry. In 2021, there are clear, tangible benefits that digitalization brings in terms of convenience. We can buy tickets on our smartphones, for example, wherever we are and whenever we want. Plus, we can also use our phones as personal, smart navigation devices, in a car or on foot.

Just as passenger travel has progressed, so has the logistics industry: We track the status and location of packages — again, anytime and anywhere — using our smartphones.

Clearly, digitalization and informatization have brought unprecedented convenience to our lives. That doesn't mean that problems don't persist in the transport and logistics sectors, however. So while buying tickets online is convenient, it doesn't in itself mean that our journeys are any more efficient. Indeed, despite technological advancements, the punctuality rate of global outbound flights is still only 75%. And commutes in cities around the world remain a source of frustration for far too many: In Beijing, for example, 26% of commuters spend more than an hour on their way to or from work. The situation is similar in the logistics field: Although packages can be tracked online, that doesn't make them arrive any sooner.

Clearly then, the transportation industry's main pain point in most countries isn't a lack of roads or other infrastructure. The problem is that information doesn't flow as smoothly as it should. Indeed, when we look closer, we see that transportation data is scattered in siloed systems, and there's a real lack of interaction between information related to roads, vehicles, and passengers.

Much as transportation has enabled widespread mobility in the physical world, Information and Communications Technology (ICT) is promoting the data exchanges so central to the digital world.

With 5G eliminating the limits of physical distance and Artificial Intelligence (AI) enabling capabilities that haven't been seen before, the development of new ICT will drive the transportation industry's digital transformation. For example, in China, Electronic Toll Collection (ETC) has been deployed at all toll booths, replacing traditional manual operations. And the result? Greatly improved traffic efficiency with the knock-on effect of less congestion.

There are ways in which passenger experiences are improving, too. For example, at subway stations passengers can now use their smartphones to check which carriage has the fewest people on it before deciding to get onboard. By first digitizing infrastructure and business processes — physically converting analogue information into a digital format — smart transportation allows people, goods, vehicles, and business processes to be digitalized.

Along with advanced transportation systems that bring greater mobility to people, improving the travel experience, such systems also pool talent and resources for far more efficient allocation, in turn boosting social and economic development. By promoting cross-departmental information exchange and data convergence, and by focusing on full-cycle services for planning, construction and operations, smart transportation uses computing power to boost transportation capacity, extracting value from data. Ultimately, the aim of smart transportation is to comprehensively improve the security, efficiency, and experience of transportation in all its guises.

Obviously, industry digitalization encompasses a wide range of scenarios. But Huawei identifies the goal of digital transformation in the transportation industry as a relatively simple one: the construction of a comprehensive transportation system that offers an improved travel experience and more efficient logistics. As such, the company is committed to supporting End to End (E2E) digitalization of the industry, to achieve this, improving productivity, operations, business models, and public service capabilities.

Scenario digitalization requires technologies, industry knowledge, and practical experience. With more than two decades of experience in the transportation sector, Huawei integrates cutting-edge ICT — including cloud computing, big data, 5G, and AI — into transportation scenarios. Huawei works with global partners to deliver an overall transportation solution focused on 'One ID, One Order, and One Map.' This means that customers are able to use one form of ID for all travel, make one order for all goods shipments, and visualize all logistics and operations information on one map. With this solution, Huawei helps customers in the transportation industry go digital — enabling truly smarter and more efficient transportation across the globe.

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Bridging the IT and OT Digital Divide with a New Digital Transportation Paradigm

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