Innovation is not simply driven by technology, it is about agility

Interview with Daniel Nieto, UPU’s Digital Inclusion and Policy Expert

Q 1: Please could you explain something about your role at the Universal Postal Union?

I am an expert in digital inclusion and policy and I work with governments and postal operators on how innovation can transform people’s lives and contribute to global development. My role is about encouraging the postal sector to embrace technology, and for them to be a vehicle for the implementation of the digital agenda of governments relating to digital inclusion, e-commerce or e-government.

Q 2: Why is innovation so important to the international postal network?

Innovation is not only important for the postal sector, it is crucial to all sectors. Investment in innovation is the only strategy that can ensure the long-term survival of a company. Innovation, however, is not only about technology, it involves creating innovation in policies and regulations. So innovation covers many areas, and is vital because it enables the postal sector to transform, and to be sustainable and relevant over the long-term.

Q 3: How is it possible to foster innovation among postal operators?

There are four distinct elements. First, postal operators need to define their role in the digital economy. The second element is to have a deep understanding of their environment. In the postal sector, for example, technology companies such as Amazon or Alibaba are building their own ecosystems, so there is a need to identify the appropriate ecosystem and understand how to interact with others. The third element is a clear digital strategy defining priorities, innovation projects, timelines, and the legal framework. In the fourth stage, the organization needs to be adapted to achieve these goals and to develop internal digital skills.

Implementing technology projects is not the only driver, companies must also have the will and the mentality to be agile. These efforts include building partnerships with other startups and delivering improved solutions. Building from scratch is also sometimes unnecessary as there are companies that can help you build successful new services. If you want to avoid the investment of considerable time and resources, partnerships offer the best solution. In a partnership, you share risks and you minimize the costs. These are the four elements needed before deciding how to innovate.

Q 4: What is the relationship between innovation and cost reductions?

In the digital space, it is hard to see cost reductions when talking about innovation. For example we have digital models such as that used by Google where they are not receiving revenue from searches; instead, they are offering free services in order to be able to capture data and offer other paid services. So the business model is not the typical offer of service in exchange for revenue. There is, however, a concrete case in which technology can save money, for example when you have a technology application for a delivery company such as a Postal operator. To offer a personal example, I was informed that a parcel was being delivered at a certain time. Unfortunately, I was on mission in Africa, so I let the postal operator know that I would not be home and could they please deliver the parcel on the following Friday. My message to the postal company was sent via a mobile phone. In this case, and due to a simple mobile application, the postal company saved money and was able to provide me with an improved service that met my needs.

Q 5: Would you like to add something?

What we are talking about is not simply technology, it is also about how to reorganize internally, how to improve the processes; but there is another element: how to update the policy framework to allow innovation to happen. The Universal Postal Union is a multilateral organization. For this reason, my role is not to be a business consultant, but to provide an inclusive framework where our stakeholders can shape and define innovative policies and regulations for the postal sector. The UPU is working closely with governments. We are trying to redefine the role of postal operators in the digital economy and create an enabling legal framework ensuring postal operators can transform and have a digital footprint in the country, as well as regionally and internationally. To give you an example, a woman making handicrafts in a Nigerian village should be able to sell her goods internationally, and through technology, receive electronic payments. Postal operators are well positioned to offer this service. They have a physical network linked to the digital network that can serve local communities ensuring digital inclusion across countries and regions.