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Delivery Robots for Smart Rural Development

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Delivery Robots for Smart Rural Development Икономика и управление на селското стопанство, 63, 4/2018 Delivery Robots for Smart Rural Development GUNNAR PRAUSE, Prof. PhD* IVAN BOEVSKY, Assoc. Prof. PhD** *TalTech University – Tallinn, Estonia *Wismar University – Wismar, Germany *Business School University **New Bulgarian University – Sofia, Bulgaria *E-mail: [email protected] **E-mail: [email protected] Abstract Rural areas in Europe suffer under demographic change and migration to urban areas which caused problems in supply, mobility and medical care for remaining population. Thus, new solutions are required for rural areas to solve shortcoming in retailing, waste disposal, postal and administrational issues since all related services become more and more inefficient from the perspective of service providers. Here, the concept of “smart rural areas” can contribute to solutions since it targets on non-urban areas and tries to improve the development perspectives of rural areas by using digitalization and smart approaches to overcome all mentioned shortcomings in rural areas. Delivery robots represent smart logistics systems and they are able to solve important logistics problems in rural areas. Originally, autonomously driving delivery robots were constructed for last-mile deliveries of packages with a focus on urban environments but recent research also highlights the possibility of their application in rural areas. Since the use of autonomous delivery robots represents a neglected research topic until now, this paper analyses tentative applications of delivery robots in rural environments and develops concepts to overcome shortcomings in logistics with these robots. Delivery robots can be considered as cyber- physical systems in the sense of Industry 4.0 so that this research also contributes to the field of smart rural development. The underlying research question focuses on how autonomous delivery robots might facilitate smart rural development. The empirical measures of the paper are based on semi-structured expert interviews, research group meetings, secondary data, and results from case studies from Estonia and Bulgaria. Key words: delivery robots; autonomous transport; smart rural development; digitalization, rural areas 1. Introduction nificantly the development perspectives of rural areas by applying digitalization approaches to Smart concepts are mainly associated with overcome rural shortcomings in logistics, mobil- manufacturing activities and logistics in urban ity and supply. Such concepts are of high impor- environments and they are often neglecting the tance since rural areas suffer more than urban ar- context of rural areas. One reason for that is re- eas from brain drain, an increasing share of el- lated to fact that approaches like “Industry 4.0” derly population and shrinking work-force which aiming to integrate digitally value networks of are accompanied by mobility, supply and health manufacturing and supply chain systems and care problems on the countryside. These develop- which to big extent are touching urban areas ments can be mitigated and even partly reversed (Prause, 2015; Prause & Atari, 2017). Otherwise, by applying smart rural concepts which has been Prause and Boevsky (2015) showcased that there discussed and showcased by Prause and Boevsky exist powerful concepts like “smart specialisa- (2015, 2016). tion” and “smart rural areas” targeting on non- A closer look to the ongoing research on urban areas and which are able to improve sig- “Smart Rural Areas” reveals that rural develop- 57 Delivery Robots for Smart Rural Development ment is closely linked to a number of challenges communication and interaction (Kagermann et that have to be overcome in order to make coun- al., 2013). try life more attractive compared to urban areas. Recent developments in smart logistics dis- Fraunhofer-Institute for Experimental Software close an existing hype concerning flying and Engineering (IESE) in Kaiserslautern highlighted land-based drones but it seems that current focus that the countryside has to be proactive to coun- of R&D activities is shifting towards land-based teract depopulation by supporting the creation of delivery robots, being the most suitable technol- workplaces as well as the rural economy. Typi- ogy to solve the last-mile problem. A large num- cally, rural challenges are related to supply, re- ber of scholars centered their research on the last- tailing, waste disposal, postal and other logistics mile problem in the context of retailing and e- services and for their solution there are formulat- commerce but mainly in the context of urban ed already some specific ideas (IESE, 2015): environment (Lee & Whang, 2001; Song et al., • “Postbus“, i.e. to use regional bus transport 2009; Boyer et al., 2009). When it comes to the for people and for packages and cargo delivery practical part of last-mile delivery, the key play- between fixed stations. The related cargo streams ers comprise the established traditional logis- can be controlled by mobile IT solutions. tics service providers as DHL, UPS, and others, • Sensors for medical care in houses of risk but during the last years more and more start-up patients and older people. from all around the world were attracted by the • Digitalization of agriculture to improve ru- research field. First serious business applications ral entrepreneurs through remote consulting, of delivery robots are already tested in the con- coaching and training from central competence text of urban areas for the delivery of perishable centres. goods as food and flowers and other applications • Remote work places in rural areas as well as in retailing and warehousing sector (Hoffmann access of rural SMEs to high qualified workforce & Prause, 2018). A literature review shows that through digitalization. the research for delivery robot use in rural areas • E-governmental solutions to improve ad- has been neglected until even if benefits can be ministrational tasks including application of ag- expected. ricultural subventions or taxation. Thus, the paper highlights the current status of • Mobile IT systems to improve the coopera- autonomous delivery robots for distribution and in- tion among rural entrepreneurs and farmers by vestigates tentative applications of self-driving de- organizing the use of shared resources (i.e. ma- livery robots in rural areas for smart rural develop- chines), shared transportation and common prod- ment. Besides that, the authors evaluate the benefits uct marketing. and usability of possible applications of delivery ro- • Renewable energy sources can be used, bots in rural areas and investigate the role such ro- managed and shared more efficiently. bots can play in the concept of smart rural areas. E-governmental solutions for rural areas have The research uses an empirical analysis based on been discussed already be Prause and Boevsky semi-structured expert interviews, research group (2016), but a deeper view to the formulated ideas meetings, secondary data, and results from case reveals that delivery services, mobile solutions studies from Estonia and Bulgaria. and internet-based applications play the same key role in the list of smart rural approaches like in 2. Theoretical background the world of smart manufacturing, smart logistics and Industry 4.0 Avramov (2017). Thus, these The still growing e-commerce market vol- ideas for smart rural development are based on umes raise the question of efficient product deliv- the same pillars like Industry 4.0, i.e. the fusion ery to the client. The last-mile delivery includes of the virtual and the real world in form of cy- three stakeholders, namely the seller, an interme- ber-physical systems (CPS) that work in dynam- diary and the client. Punakivi et al. (2001) dis- ic networks using machine-to-machine (M2M) cussed the last mile-issue in the traditional con- 58 Икономика и управление на селското стопанство, 63, 4/2018 text of B2C and e-commerce; they proposed an cause during about 10% of the time they are re- unattended reception of goods which could re- mote-controlled from a command centre, which duce home delivery costs by up to 60%. The un- is linked via Wi-Fi and telecommunication net- attended delivery approach is based on the two works to the robot. Thus, the technical realisa- main concepts of a reception box or a delivery tion of such robots can be placed in the context box. The reception box is installed at the custom- of Industry 4.0, since they represent cyber-physi- er’s home, whereas the delivery box is an insu- cal systems (CPS), which requires internet–based lated secured box that is equipped with a dock- linked machine-to-machine (M2M) communi- ing mechanism. Based on simulation, the authors cation and interaction. Existing M2M concepts came to the result that home delivery solutions are mainly researched by technical scholars so enabling secure unattended reception are oper- far. Cha et al. (2009) discuss different use cas- ationally the most cost-efficient model for last- es for M2M communication together with com- mile distribution. They also confirmed that a se- mon security requirements to clarify the security cured delivery box solution potentially enables a requirements on M2M systems. Their business faster growth rate and higher flexibility of the in- cases include logistics-related M2M applications vestments because of a smaller investment being and come to the conclusion that information se- required per customer. curity and trustworthiness of the operations in- A new approach for solving the last-mile-
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