“ A System’s Innovation Approach in Identifying Policy Measures in Support of Inter-operability and information Flow in

1. “A System’s Innovation Approach in Identifying Policy Measures in Support of Inter-operability and information Flow in Surface Transport” Raimonds Aronietis, Claudio Ferrari, Koos Frouws, Laurent Guihéry, Seraphim Kapros, Maria Lambrou, Michael Lloyd, Amalia Polydoropoulou, Athena Roumboutsos, Thierry Vanelslander Presented by Koos Frouws

2. Introduction Organizing change is a challenge. • especially if the generated benefits are diffused and spread amongst a whole set of actors. • If the innovation driver does not coincide with the innovation user. • If the number of actors grows.

3. Introduction These conclusions were part of the findings of InnoSuTra (Innovation processes in Surface Transport). European FP7 project. Goal: To identify process barriers, enablers and policy initiatives to support and accelerate innovation in Surface transport.

4. Introduction • 23 innovation cases were studied. Technological, organizational , managerial and cultural cases. • Mostly incremental innovations. • Five focused on information flow, Port Community System, AIS for the inland navigation industry, ERTMS rail safety system, IATA and E-freight Seemingly technology driven, these information flow projects proved to be mainly organizational, managerial or even cultural in their nature. They are not “one business” driven but more market driven. Consequence: a lot of actors.

5. Methodology The on “evolutionary theory” based Systems Innovation approach is applied on: The “with innovation involved” non linear processes in which actors/firms interact with a considerable variety of other actors like research institutes, authorities, customers, financial organisations etc. SI identifies: Actors Quality of interactions

6. Methodology The results of the Minnesota Innovation Research Process (MIRP) are used to structure the thinking around the process phases of innovation. MIRP recognized : • Initiation Period • Development period • Implementation/termination period

7. Minnesota Innovation Research Program (MIRP)

8. Methodology For example applying SI on the Y-shaped hull example: Learned us the importance of innovation grants in the Initiation phase to develop an early prototype.

9. Case 12: Y-shaped hull Methodology Y-Shaped hull Conventional double hull

10. Methodology Yshape hull example (Initiation phase) White ball = not supporting area Blue ball = strongly supporting area of networking

11. Methodology Institutional environment (vertically): • Infrastructural success conditions • Adequate transport and commmunication structure should be there. • Institutional success conditions • Hard institutional rules, like laws and standards • Soft institutional rules like political, economic, cultural influences on innovation. • Interaction success conditions • Strong interactions • Weak interactions • Capabilities

12. Methodology Highlighting weak and strong interactions: • Weak Network problems leading to the inability to learn from each other and inability to create a shared vision on technology development. • Strong network problems • Actors guided in the wrong direction. • Internal focus • Dependency from dominant partners • Absence of weak ties with other industries which could support cross fertilization.

13. General Findings Variety of innovation cases made general conclusions difficult. However, by separating the phases some conclusions could be drawn. • Fostering the relations/networks between the actors relevant for the innovation uptake is crucial. In particular when policy innovations are involved. • The existence of a committed initiator (promotor or sponsor) with the power to bring all relevant stakeholders together is a common factor of success. • Support from standardization bodies is powerful. Financial support for technological innovations in the initial phases, especially in the case of smaller firms. • "Policy initiative" cases, mostly managerial/organisational or cultural changes were often not beneficial for all players. This can lead to substantial and partly successful resistance.

14. Applying the methodology on information systems. AIS (Automatic Identification System) • Introduction via Central Commission for the Navigation of the Rhine (CCNR) • Regulations for technical standards 2006 • Regulations for installation registration and maintenance • March 2010 CCNR announced intention to make AIS mandatory • Subsidy programs, German and Dutch for barges • Extended to the Danube Area

15. Applying the methodology on information systems. Results SI analysis: • Initiative came from the principal actor, the regulatory body, CCNR. (Application of hard rules) • CCNR supplied technical standards, so commercial actors could act by building equipment. • European pilot projects with barges and shore organizations (created weak but supportive networks) • National Government intervention via specific subsidies. (again soft rules)

16. Applying the methodology on information systems. Introduction Port Community Systems (PCS) in Thessaloniki • SI findings: • Positive influence of an experienced R&D company working closely with the port authority, a company technically informed about information exchange software but also aware of European funding possibilities. • Negative impact of the strong Unions. The PCS created changes in procedures and equipment (cranes, straddle carriers) • Despite the resistance, the rigid strategic plan of the port combined with powerful and respected leadership proved to overcome the hurdles.

17. Applying the methodology on information systems. European Commission decided in begin 90 to initiate standardization of rail network to improve interoperability. Consequence ERTMS, a system which reads the local signalling equipment from each country. The dependency on local equipment will be minimized in the future by means of higher levels of the system by information exchange systems communicating with GSM-R radio systems.

18. Applying the methodology on information systems. SI analysis: • EC - manufacturer network was strong and showed the national operators the possibilities during the development. • It was difficult for the national operators with the other actors that manufacturers could develop themselves new rail systems, and that the EC could define new rules.

19. Applying the methodology on information systems. E-freight aims to take the paper out of the air cargo supply chain and replace it with cheaper, more accurate and more reliable electronic messaging. (for surface transport ongoing, so we decided to study air transport) SI analysis: • The main goal of IATA was to simplify and improve the cost effectiveness of the business operations of the air industry. BUT also supporting new players • IATA worked with all relevant supply chain actors and ensured that capabilities and local stakeholders were present and actively involved. • Development and integration of international standards incorporating new business processes. (Integration of hard rules) • IATA avoided capture of the project by major internal or external actors. (strong network dominance problems)

20. Conclusions The application of the SI analytical approach to AIS and E-Freight offers insight in innovation processes • Viewing E-freight as a mainly organisational innovation and utilizing the SI framework to involve the necessary actors and to provide the essential institutional environment may create a rapid development and implementation of e-freight across multi-modal surface transport. • An organizational innovation approach based on a contract between the business actors would appear to be a win-win situation. But it is also possible to consider the stimulation of such an approach involving EU and/or state intervention with regulatory or other support.

21. Conclusions • E-freight applied on rail could be useful in the light of the earlier European developments in the rail freight sector. • Air freight, and intermodal surface transport do differ substantially. However the innosutra team believes that the SI approach can be successfully used to increase the penetration of paperless freight surface transport solutions. Thank you for your attention