Interview: Fabien Seraidarian (Senior Manager, Mazars, Paris)
Could you briefly explain what a ‘smart city’ is? What are the key issues surrounding this idea? What are the requirements of the cities of tomorrow? How do we reconcile aesthetics and mobility? How can stakeholders with different interests work together to create Shared Value?
It is important to make a distinction between concepts such as ‘smart cities’ and ‘cities of tomorrow’. A ‘Smart City’ relates to technology, which is only one part of the broader ‘Cities of tomorrow’ concept. There are plenty of other opportunities for innovation besides technology!
These days, we know that big cities develop more organically than the planned cities of the past do. This creates big challenges as to governing, organising and engaging stakeholders across the private and public sectors. We need to make the city a creative and innovative place that responds to people’s needs.
All stakeholders must contribute to building the cities of tomorrow. Otherwise, we can’t maximise the benefits of creativity and innovation. We need to design solutions that match resources with stakeholder knowledge and develop an organised framework including that reconciles everyone’s constraints and opportunities.
All cities are unique: you can’t apply the same solution everywhere. Le Corbusier wanted to demolish historical cities and start with a clean slate, but we now know that this does not create liveable or economically sustainable environments.
We believe that the city is a new market, an economy, and that’s why stakeholder engagement is so important and why we need inter-disciplinary collaboration. This knowledge that we have comes from our experience with public/private projects. Finally, on a global level, more people are living in cities so this market is growing.
What is Mazars’ involvement in the development of smart cities?
We work with the Ile-de-France board (Paris regional board) to bring together various stakeholders involved in urban logistics, from both the private and public sectors. We carried out our first urban logistics project three years ago. This helped us understand how urban logistics works – how people deliver goods to Paris – and how the sector is organised. We also explored the environmental, social and economic potential of this business.
The board of the Ile-de-France region then asked Mazars to reflect on how we could promote new business models on a larger scale. Our response was to create a methodology using the integrated stakeholder approach that we had previously developed. The first part of this study involved international benchmarking and methodology design. In the second part, we selected some urban areas in which we could test the methodology, demonstrating that it could lead to new urban logistics projects. We also created a new framework and policies for urban logistics in the region. Lastly, the region held a big meeting to present the new approach and build stakeholder engagement.
Now, Mazars is considered as an innovator in the field of urban logistics. We are in a position to leverage this knowledge and assist other clients on the topic of the cities of tomorrow.
Mazars worked on a major urban transport study for the Ile-de-France region – what role do mobility and logistics play in smart cities?
Our client asked us to help develop their skills and knowledge in this area simply because urban logistics is key to make cities sustainable.
Urban logistics is a very complicated business in terms of net returns; it can be deemed hard to invest the required capital to test these new processes. Mazars looks at it from a B2B perspective: how can we design new ways to deliver goods more efficiently and quickly without any negative spillover effects such as increased traffic congestion, noise, pollution, etc.?
What challenges does this particular region face as to transport logistics?
Traditionally, regional administration is not concerned with urban logistics. There were very few policies for urban logistics at the regional level. Since transportation is an important activity, the Ile-de-France region had tried to create new policies, and develop new infrastructures but they needed a new approach.
The regional level is crucial because it requires collaboration between cities. In the Ile-de-France region there is Paris as well as several smaller cities. Each city council has its own regulations (parking, driving, speed limits, etc.). It gets a bit more difficult for the transportation sector because as you change cities you change regulations. This is why the region asked Mazars to help homogenise regulation for the transport sector.
Who are the stakeholders, and how does this project benefit them?
For a long time, everyone involved in urban logistics – city councils and private and public organisations (such as the public transportation authority, distributors…) – considered that they were in conflict with one another over how to develop their business. Mazars helped these stakeholders to work together.
It’s important for the public sector to understand the private sector, to create a framework that ensures fair competition for a range of different organisations.
Citizens are also stakeholders in these projects and we need a database of people’s changing needs so that we can better understand them and be reactive.
Could you summarise the key findings and main steps of this project?
During the international benchmarking phase, Mazars put the emphasis on the fact that each city is different. You can’t compare Paris and New York in terms of infrastructure, administration or project typologies. For urban logistics businesses it’s difficult to expand into other markets because you can’t deploy the same approaches and projects across different locations. Although benchmarking is interesting and useful for inspiration, policy solutions for specific locations will always be different; we can’t duplicate ideas.
We also noticed that certain cities were better at implementing new, innovative projects than others. We needed to develop a new governance framework for the Ile-de-France region to encourage this to happen there! There is a lot of regulation in France, which can be good but can also make it difficult to innovate. We looked at case studies for very small businesses, and studied how we could scale up successful approaches without producing negative spillover effects.
We focused on three main elements. The first was territorial configurations. Different urban areas in the region have their own specificities due to a number of factors: streetscapes, retail typologies, and people’s varying needs. Rather than generalising, we needed to comprehend their complexity.
Next were the issues particular to urban logistics: lowering negative spillover and responding to the impacts of new markets such as e-commerce supply chain logistics.
The third element was to involve new partners. We created a sort of ecosystem, promoting a collaborative approach for this new market in order to involve all stakeholders.
The key objectives of Mazars’ responses:
- Promote new opportunities and push the public administration for the sector (financing, advising, operating urban logistics infrastructure) to evolve,
- Improve governance by helping all stakeholders to work together,
- Develop new business models.
We selected three different case study sites within the region:
- Saint-Ouen – Just north of Paris, which has a relatively new urban infrastructure,
- City of Nanterre – West of Paris, which is an old commercial centre with heavy traffic,
- Porte de Pantin – on the cusp of Paris’ border, a new site where we could develop a new urban logistics infrastructure.
Each project explored:
- Technical/functional aspects,
- Governance/operations – how will we operate?
- Business level – how will everyone earn money?
- Regulatory – contracts and viable agreements between stakeholders
To initiate the methodology implementation phase, each stakeholder group was briefed to develop a mutual understanding of opportunities and constraints. Everyone committed to a manifesto, giving everyone ownership of the project.
We then analysed the resources that could be used and/or shared. For example, La Poste could be paired with a start up: the project then benefits from La Poste’s significant resources together with the start-up’s innovation capacity. Projects were designed collectively, responding to the specific demands of each location and engaging all stakeholders. We organised smart competition, maximising value creation, collaboration and innovation.
What are the tangible results of Mazars’ recommendations from this project?
Mazars has created new knowledge and skills and set a new direction for the region. This has triggered a wave of new opportunities and experimentation in urban logistics (e.g. bike couriers) in Paris and other parts of the country. We are eager to promote new paradigms, solutions and services, and to make them more relevant in terms of their social, economic and environmental impact.
Some results from our case studies:
- Saint-Ouen: Several projects have been deployed in this location, including a ‘smart mailbox’, open 24/7, which will make delivering goods more secure, a kind of ‘reverse logistics’. All retailers can drop goods in these mailboxes, making the delivery process more efficient. It’s a simple idea but has a lot of potential to impact the supply chain: acknowledging that many deliveries are made when people are not at home and reducing negative spillover of congestion during the day.
- Porte de Pantin: Companies usually invest in warehouses outside the city to increase profits. This can lead to bad customer service because operators can’t guarantee delivery times due to unforeseen events such as traffic jams. The key idea was to bring goods closer to clients by finding warehouse locations inside the city where the cost is usually too high. We negotiated with private and public stakeholders to identify rarely used sites within the city to transform into new urban logistics warehouses. Our test site is a 2000sqm area located at Porte de Pantin that is owned by the City of Paris. The warehouses are used by multiple transportation companies to improve competition. Also, by transporting goods in small/electric cars rather than trucks, it reduces negative spillover effects in terms of noise and traffic jams. A tender has now been launched by the city of Paris for this project. Because of the collaborative nature of these projects, we had to seriously consider regulation: how to provide access, invest and secure these areas.
- Nanterre: Here, the issue is delivering goods to a range of businesses such as restaurants, butchers and retailers in a city centre. It becomes very busy and messy to have trucks in the street. We used qualitative and quantitative data to rethink new options. It is sometimes tricky to work with retailers as they can be fearful of change. Some options were having warehouses close to the street to minimise transport and also to stagger delivery hours. Restaurants could receive their deliveries in the morning and other retailers during the afternoon or evening. Currently, there are regulations regarding deliveries during the day but they don’t differentiate between the types of goods, which plays a role in traffic congestion.
How could Mazars’ expertise be applied to other locations or sectors?
From our experience with urban logistics, we know that it is a big challenge to implement these strategies and foster collaboration between the private and public sectors due to administrative constraints, fear of change and organisational requirements. This complexity applies to other sectors in the cities of tomorrow. Mazars is eager to leverage its expertise in urban logistics. All types of services could benefit from this framework. For mobility issues, a collaborative approach is crucial, but this methodology can also be applied to other key policy areas such as education and health.
Mazars has also worked on developing electric cars, where we applied a similar methodology of stakeholder engagement. We are also exploring a car rental model in order to provide vehicles for professional usage. This means businesses would not need to own delivery vehicles, they could rent dedicated commercial cars.
This project focused on a private/public partnership – will this kind of partnership become the ‘norm’ in the future?
For a private/public partnership to be successful it needs to be considered at the very beginning of a project in order to really understand the potential. This is a means for the public sector and government to increase their knowledge and skills in urban logistics and to develop policies; when private firms understand government and public policy better, they can be more competitive because they can anticipate regulatory demands more effectively. With our methodology, even if you are involved in the early phase of the project, it doesn’t preclude you from responding to any resulting tenders yourself.
Private/public partnerships definitely have to become the norm in the future. From what we’ve learned, it’s a very interesting process with lots of challenges: to manage the workshop, to create the group and to promote working together.