Since early 2024, Per Olof Arnäs has been a consultant and board member in the fields of logistics, technology, and digitalization, and has been chronically frustrated by the slow pace of digitalization in the transportation sector. But now he sees change coming in full force thanks to electrification.
– It’s still mostly computerization out there, not digitization. The industry often uses digital technology to keep working as if it were still 1999. While other industries are using digital technology for radical transformation—rewriting the rules of the game—the transportation industry has clung to old models developed throughout the 20th century,” says Per Olof, comparing it to industries such as media, streaming, banking and finance, and the hotel and travel industries, where digitalization has truly been a revolutionary force.
– In the transportation industry, we didn’t gain access to useful digital technology until the 1990s, and by then we already had a global, functioning transportation system. We computerized this system and continued in the same direction, albeit with slightly greater efficiency. But we didn’t make any fundamental changes the way many other industries did.
Disruption Leads to Transformation
He believes that we are now facing a disruption—a significant upheaval—that will force a digital transformation even in the transportation industry.
– We are facing a disruption—the third in 100 years, following the truck, which emerged in the 1920s, and the container, which was introduced in the 1950s. With today’s disruption—the electrification of the transportation system—the digital transformation will be forced upon us. Finally.
Cross-Dependencies
Per Olof explains that this will happen because electric vehicles have so many interdependent relationships with one another—through chargers, energy availability in terms of time and location, logistics flows, and much more.
– My prediction is that we won’t be able to scale up electrified fleets without advanced digital decision-support systems that provide real-time data. Electrification will therefore lead to rapid digitalization simply because it’s necessary—it’s no longer a “nice-to-have,” but a ”must-have.” Today’s and yesterday’s diesel vehicles can, in principle, be planned completely independently of all other vehicles, regardless of the fleet’s size. Compared to electric vehicles, this is a very simple system.
Positive Exceptions
Despite his harsh criticism of the transportation industry’s slowness to adapt, Per Olof highlights a few companies that he sees as positive role models and trailblazers in this nascent transformation.
– There are transport companies that have recognized the strategic advantage of not only electrifying their operations but also taking control of their own energy supply, which is necessary for scaling up. In Sweden, for example, LBC Frakt and Falkenklev are pioneers in this field. The emerging energy supply system for transportation is also giving rise to new types of companies and solutions that are fundamentally based on digital technology and AI. BEV_r is one such company that takes a systems-level view of charging stations, vehicles, drivers, transportation companies, energy providers, and cargo owners, and offers a planning system for heavy-duty electric vehicles. All of these components need to be included in operational decision-making, which is impossible to do using the industry’s outdated 1999-era model.
The system first
Here, Per Olof emphasizes the importance of adopting a systems approach and the need for a party to take on the role of change leader, or "channel captain.".
– Those who are most successful at driving change in the supply chain move beyond the “me first” mindset and realize that collaboration and a systemic perspective benefit them in the long run. One of the players often takes the lead in the chain and ensures that profits and risks are shared transparently. When this doesn’t work, it’s often because the system is too complex, with numerous players who fail to act together for the good of the system. “It simply becomes too complex when individual actors act in their own self-interest, which can lead to suboptimal outcomes,” says Per Olof.
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Per Olof Arnäs is an experienced debater, motivator, and advisor with deep and extensive experience in the digital transformation of the transportation industry and a background as a developer, practitioner, and researcher. His career began in 1989 with a part-time job as a transportation manager in a room full of paper, but no computers. In 2007, Per Olof earned his Ph.D. with a dissertation on how the increased complexity of transportation systems can be managed using digital technology.
