DHL’s Search for Cutting Edge Logistics Solutions

Published Feb-07-12

World market leader in sea and air mail turns to open innovation to further develop their concept for City Logistics and make deliveries more efficient and greener.

DHL, Germany

The Story:

DHL’s Search for Cutting Edge Logistics Solutions International express shipping provider DHL faces a number of challenges every day as it seeks to optimize its logistics and transport activities in urban areas, whilst considering the traffic environment, traffic congestion and energy consumption within the framework of a market economy – known as City Logistics.

To help it stay on top of its game DHL Solutions and Innovations launched an open innovation contest in October 2011 for ideas to help the company reduce traffic bottlenecks and congestion, promote ‘green’ urban living and deliver efficient transport solutions.

“With growing cities all over the world, the challenges of city logistics and urban living are becoming more and more demanding,” said Steffen Frankenberg, Vice President at DSI. “Solutions for decreasing traffic and getting cities greener are crucial for the future. DHL knows that the logistics industry plays a significant role and we want to broaden our approach to City Logistics by also inviting people outside the company to contribute their perspective.”

Collaboration with Diverse Group of Experts

The call went out to academics, IT experts, public authorities, citizens and others with an interest in developing the concept of City Logistics. DHL believed that OI offered the best way of bringing together a diverse group of specialists from different fields and that this would enable the company to better identify the challenges and create innovative logistics solutions.

The open innovation contest was conducted via a web-based platform and centred on three categories. Each category presented a number of tightly focused questions to help guide thinking and prevent the submission of a plethora of wide of the mark ideas.

1) Logistics efficiency in urban areas i.e. - what can improve the logistics flows of goods and services in and out of limited environments? What new logistical challenges might there be in the future? What kind of solutions can be developed to respond to these challenges?

2) Green city and urban living i.e. - what defines a truly green city and what does it take to become one?

3) Digital logistics i.e. - which IT Solutions could improve logistics with respect to traffic management, traffic prediction, warehouse management, etc.?

The contest was open for six weeks and a panel of expert judges then spent three and a half weeks evaluating and reviewing ideas before they selected the winners.

Winning Solutions

There were two winners in each category and among the prize-winning ideas were:

‘Collaborative Logistics Hubs’, a winner in category one, is an idea that uses collaborative logistics hubs (CLH) at city borders at the main traffic roads and employs green mobility for inner city transportation. It posits that DHL should operate the hubs and the inner-city transport. According to the jury the idea is “inspiring and scalable”

‘Earn as You Save’ was a winner in the Green City category and is an incentives-based scheme to encourage DHL drivers to optimize their vehicle usage. Digital tachographs can collect information about their journeys and prizes would be awarded for the driver’s efficiency. The jury said, “this idea simply works”.

‘DHL "GRAB A SLAB":Smartphone App for freight consolidation’ was a winner in the Digital Logistics category and is an app that notifies select companies of the percentage of free space in DHL trucks and where they are going to. It is built on an existing service and the jury said it could be used for “last mile delivery, as well as long haul transport”.

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