Blythe Brumleve:
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Welcome into another episode of Everything is Logistics, a podcast for the thinkers in freight. I am your host, Blythe Milligan, and we are proudly presented by SPI logistics. And in this episode, got a special one for you today. It is recapping my trip to Chicago to tour the new DHL export facility and also their innovation center. It was my first trip to Chicago when it's not like forced layover where a flight gets canceled and you have to sleep in the O'Hare Airport. That was a story long ago, but for this particular trip, it was my first time to Chicago. Didn't actually get to see any of you know the touristy, traditional touristy sites. It was strictly business for this trip with a little bit of food mixed in. So in this episode, I thought it would be fun to recap everything I learned as someone who has spent more than a decade in logistics. There are always these nooks and crannies of the logistics experience or the logistics process that I am still learning about, and it would be weird to call DHL and company that can process 10,000 packages in an hour as a little nook and cranny of the logistics process. But it's not. It's massively scaled. It is a massively impressive and in this video, which is also going to be a podcast episode as well, so I'm going to do my best to explain what I saw while I was at the facility. But then, if you're also curious, you can watch the video version of this episode and see some of the little cell phone footage, the B roll that I recorded while I was touring the facility and taking a bunch of notes, and now I've got them all compiled in a nice little episode for y'all today. So let's talk about the first thing that I learned, and that is, this isn't your typical warehouse. Now to sort of give you the lay of the land, the innovation center is based in Chicago, but the warehouse sorting facility is about 30 minutes away, and so for the first part of the day, we met at the Innovation Center. We spent a few hours there, and they have the Innovation Center, where it's split off into several different sort of sections of the innovation center where they're explaining all of the different initiatives that DHL is taking on. And now the warehouse in particular, where it does like the actual sorting of E commerce packages. They call it an export facility. And so because an export facility, majority of packages are all shipped internally to that facility, and then they go through a series of processes of sorting and and before they're made it, or before they make it to their final destination of the overwhelming majority of those packages are shipped to their sister hub in Cincinnati, Ohio, where they will then be exported out globally for a lot of those different packages. So it was really, really cool to see from the warehouse perspective. Now, a couple numbers I want to throw at you is this is 100,000 square foot facility with 96 built parking positions, a fully electrified EV infrastructure. All of the vehicles inside of the facility were all able to be charged EV and so they had all of these different DHL vans that were driving in and out and charging up for the night. Now we got to this warehouse facility around 6pm and so for a lot of those drivers, they're already kind of done for the day. And it's more or less the nighttime crew that is taking over afterwards, not necessarily to continue driving those vans, but to continue some other work that was going on in the facility. And so there was a few different I would say there was maybe a dozen employees inside the entire facility. And so if you think about it, that this 100,000 square foot facility is is sitting right there and sorting to up to 10,000 packages in an hour, to have about a dozen people that's doing that job, that kind of hints at a lot of the innovation that is taking place within DHL, to be able to have a facility that can handle that many packages, that's that large, and run with a few amount of people, which is obviously kind of a separate conversation, as far as you know, what the roles within shipping will look like. But for a modern day facility that you know, with e Commerce Trends just exploding and growth over the last handful of years, and with no signs of showing down or slowing down, that is, you know, a recipe for a facility like this, and the need for a facility like this to be able to continue reaching and meeting that demand, not only now but in the future. So couple more numbers that I wanted to throw, or little fast facts that I wanted to throw at you for the innovation. Center, specifically when it or not the innovation center, but the warehouse facility, the export warehouse facility. Another note is that they had a hospital area for packages that needed manual intervention, and so because this is an export facility, a lot of the packages that are coming in, they have to go through the same customs and border scanning equipment that you see largely at airports. And so because this is going to another airport, a lot of these packages are going to another airport. There are there's a whole assembly line where air cargo is placed, air or air cargo, I guess, components are being used. And so we're going to put some some visuals up on the screen in order to help, kind of showcase what those visuals or what I'm talking about. But kind of looks like part of a plane, and it's sitting at the end of there's several of them. There's about four or five of them, these little containers, but containers specifically built for a cargo plane, and they have all of these belts that all run throughout the entire warehouse. And as the packages get sorted, and as they get scanned, and they go through all of the different security measures, then they go into their different sorting facilities, and then they get dropped off right into those little airplane cargo container compartments. It's probably the best way that I can explain it, if you're looking for, I guess, kind of a verbal explanation of what these systems look like. It's looks like the outside is kind of like the whole of a plane where it's that kind of a metal but then it's like a oval shaped container that's then cut in half, and then the packages, and all the different packages go inside of the container, and then the container itself goes off on a belt onto another truck, and then that's what's shipped over to the airport facility. That's then it's put into a plane, and then it's flown over to Cincinnati. So hopefully that makes sense, but if not, we'll have some visuals that will be showing up on the screen to explain it a little bit more. So they have a hospital area for some of those packages that need the manual intervention. And then, last but not least, they let us test some of the not necessarily test, but they let us walk around and see what some of the the robotics look like that are sorting some of these packages as well, and some of them are the same robotics that we saw at the innovation center. So it was cool to go to the innovation center first and see some of these robots in theory, of being able to pick and pack and sort all different kinds of packages, but then to go and see it in real life, of when it's happening at a large scale, was really, really impressive. At first I thought I had heard the number of 1000 packages an hour, and I was impressed by that stat. But then friend of the show, Nathan Cheney, you might know him, of a supply Cheney content creation, He private message me, and he was like, Are you sure you know there wasn't a different number? Because 1000 doesn't sound all that impressive. And I was like, it sounds impressive to me. And like I thought it was impressive. But then I went back and checked the transcript of the recordings that I was taking, and sure enough, they said 10,000 packages in hours. So shout out to Nathan for helping me out there for that, because I was still impressed at 1000 but 10,000 is just mind blowing. Okay, the next one I want to talk about, that was one of my major takeaways from this DHL tour, and that is the connection between humans and robots. And most importantly, or most interesting, I think, to me, is how DHL is approaching the building of relationships between the two. I guess mediums is the right way to say this, because it's no secret that for a lot of employees, and not DHL employees specifically, but just employees in general that work in and around supply chain. Probably heard the debate, you know, between autonomous truck drive or autonomous trucks and truck drivers who don't want to see this technology, you know, kind of take hold. There's a whole argument that could be made, is this kind of technology actually ever going to take hold? I'm not so sure on that. But where robots and robotics are really taking shape is in E commerce and warehousing. More than 90% of warehouses all across the country do not have any kind of robotics. But it's also at the same time, it's very difficult to find warehouse workers, because there's a real concern. Amazon publicly stated this back in I believe 2020 maybe 2021 that they thought that they were going to run out of potential warehouse workers, because it's so challenging to find people that can do this kind of job, to meet this level of demand, to be on their feet all day. It's depending on the role within the warehouse. It's also kind of dangerous at times, just depending on the role that you might have. And so they're trying. Trying to have robots in place where those jobs are dangerous, where they're really strenuous, and where, frankly, they just don't have the people who want to do the work inside of the warehouse. And so what do they do? They take these different robotics and they make them specialize in a specific area, specific field. One of those things was called a robust AI, and that is a lidar guided warehouse assistant that helps with picking tasks. This was the same robot. I believe it was the same robot that we saw inside of the innovation center, but then also we saw it at the warehouse itself, doing the picking and packing. And so these are things directly being tried out in the innovation center. And then when they prove the test proves that it does well, it does goes for another trial inside of the warehouse as well inside of the warehouse. And then if that does good, if that performs well, then they will start deploying it to more and more facilities so robust. AI was one of those pick and pack robots that I thought was really interesting. It also moves really quick and really strong. So you kind of the environment that some of these robot the robotics are put in, are very much contained, and they're also very much doing one role. And so then I think for a lot of us, especially when it comes to robotics, because we also saw the Boston Dynamics, you know, famous spot dog that is seen at a lot of different logistics conferences manifest in particular. I've seen it there a couple different times, but the Boston Dynamics, you know, Spot dog was at the facility at the innovation center as well, and so being able to test how the different types of robotics can interact within the warehouse. Now that particular robot and they have a partnership with DHL at their innovation center. I did not see one of these robotics at the warehouse facility where the Boston Dynamics where they they call them spot in you know, some areas by the Boston dynamic team, but if you have your own spot, then you can name it whatever you want. In this case, they were still at the DHL Innovation Center. They were still trying to come up with an official name for their version of the Boston dynamic spot. I think they were going to land on Wrigley, but they hadn't confirmed it yet, but it seemed like a couple of the employees, you know, were pretty pumped about being able to, you know, name it after, you know, something local and something within Chicago. Have a little, you know, Chicago pride around it. But that, that dog, I guess, that robot, robotic dog, was inside of the innovation center, and they said most of the use cases for that is mainly just inspecting dangerous materials, inspecting dangerous situations. There isn't really a use case within specifically a logistics e commerce area that's going to make a whole heck of a lot of sense, but the technology that's being developed with that system can then be applied in other areas. So one of those areas is called the Boston Dynamics stretch, which helps with unloading trucks with real time pressure adjustment on different packages. So I thought that that was really cool. Then we had another part of the innovation center was not just touring and seeing all of the different, you know, sort of robots and things that were going on. They also had a lot of, you know, handheld, you know, Pro Glove, which we've had an interview with, with one of those representatives on the show previously. It's kind of like an Iron Man glove, where it the user, instead of having to take a UPC or a barcode scanner out of their pocket. You know that those couple seconds that it takes for to you to pull that scanner out of your pocket and scan something Pro Glove instead, is the glove that you wear on your hand, and you kind of use it like Iron Man. You can just scan it on your hand, because they found that when the workers could save, you know, a second and a half of scanning that that amounted to minutes every day, minutes every day add up to every single week, every single month, year, and so on and so forth. And so that's what the purpose of the innovation center is. Is, where are these minor tweaks that we can make in the shipping process in order to gain back seconds and minutes, because all of that matters, especially when it comes to e commerce, shipments. And so I thought that that was really cool, and then from a psychological perspective, because after we got done touring the Innovation Center, and before we went to the export facility, we got to sit down with a bunch of the DHL executives, and asked them, and they gave a presentation, which we might be able to share at the end of this show. So I'll share that if we're able to, if we're able to clean up the audio, no promises. So shout out to Josh if he's listening. Hopefully he can make the audio, you know, sound really pretty, but we will play that talk. At the end of this conversation, so then that way you can listen to it, if you would like. But they really talked about and one of my questions was, how do you approach the fear element of this robot is going to take my job when you introduce something like robotics to a warehouse worker? Because I was listening to a conversation at for six river systems, they believe they were purchased by Amazon some years ago, but in one of their calls, they talked about how they had to have a psychological element to their technology onboarding, because when they were introducing robotics to warehouse workers, there was this animosity within the warehouse worker that I'm just training this device to take my job, whereas now they approach the training to especially when it comes to DHL. And this is how they answered the question when I was kind of insinuating like, how do you combat that fear element whenever you introduce robotics, and they say you have to really take the team and be able to build with them, and build a program with them. So then, that way, they see the robotics aspect, as a partner, as a helper to their work, not taking their job. And so for the folks that embrace the technology, that embrace the willingness to evolve as work evolves, then you're probably going to be one of those, you know, dozen employees that are working inside of an automated warehouse versus, you know, another type of warehouse where they're not going to have any kind of robotics. You're at risk for more injury. You're at risk for, you know, kind of falling behind. And so if you're willing as a worker to be able to embrace this new style of, you know, different optimizations that are going on within the shipment process, then I would think that you would have more longevity as far as a career is concerned, and then you would also be less prone to future risk as far as injury is concerned. And so I thought that that was really interesting, that they approach the training and the onboarding of a new robotic system within a warehouse by using it as almost like a collaboration with the internal warehouses or with the internal employees that work within the warehouse. And so I thought that that was also really important too, is that you want to involve whenever you're going to make a drastic and not drastic, but a huge investment in something like robotics, then that's something that you want to involve your team with, because you obviously want to take care of your team and be able to grow with them, and hopefully they're supporting a lot of the investments that you Want to make in order to shore up the business, make it as profitable as possible. Because if it's as profitable as possible, then that means job security for you in the future, at least, that's the way I think about it. I know other people have, you know, some negative thoughts, especially when it comes around. You know, technology and advancements and automation and AI, I take the positive approach. So I'll let the naysayers have their opinion and but it's my show, I get to have the positive opinion. And so I thought that that was super interesting about the human and robots, you know, kind of pairing them up to be the real power couple. Okay, number three of the things that I learned during the DHL tour, and that's awesome. I mean, we can't have a robotics episode and a technology positive episode without talking about AI, right? And so this is the AI part of the conversation. And of course, DHL is embracing generative, generative AI as well as many of their customers, because they're they have a Gen AI hub with 75,000 plus users across 140 countries, making 1.5 million API calls a month. The representative at DHL that was giving this information did a live demo where you can call, as you know, as a warehouse facility operator. You can call and say, How's my supply chain doing today? And the AI bot will scan all of your information, all of your data, and it will give you a full report on how it's doing, good, bad, where the where are the exceptions? Where we falling? Where are things falling through the cracks? And so then that way you can focus on more of like, what's not working and fix those issues quickly. And then that way you know you can focus after you fix the issues, and you can focus more on the good stuff. So I thought that that was really interesting is how many people are using their generate generative AI product, so that 75,000 users across 140 plus countries making 1.5 million API calls per month, they have a product classification tool that processes 35 million customs entries, which, if you're working in customs, if you're working anywhere with cross border trade, right now you have my ultimate empathy, sympathy, all of the the peas that go along with feeling your pain, of what you're you're going through right now. Now, but this is a perfect situation of where AI is actually useful, because if you can quickly classify a lot of these different customs codes and trade policies across the globe, and if you can do it at a massive scale where it's also accurate data as well, then that just, I mean, I that's very, very impressive of how quickly a process like customs and border cross border, trade and that tariffs can all play a large role, and it flips on a dime, and you have to have technology in order to help you process through all of that information, otherwise your business is going to suffer or possibly go out of business. So I think it's really cool that DHL actually has those tools. Here's one of my favorite quotes from the tour that was said by a DHL representative. He said the AI has left the screen. It's in the warehouse on the trailer, and it's making real time decisions. So good. Good quote there about using AI that's actually useful, all right. Number four, kind of cheating on this one, because I kind of already mentioned it before, but that is the customs process of all of the packages in the at the sorting facility, at the export at the export facility, and how all of the different packages have to go through all of the same technology of scanning that the Customs and Border Patrol have at their disposal. And so all of you know, you when you take your suitcase and you put it through, and it goes through all of the, you know, the different security measures that same thing, just slightly more sophisticated, was also at the export facility. And so all of the packages that were coming off were going right through that truck. And then there was a one shoot is for the good packages, and then the other shoot is for the bad packages. So that was super interesting. Another interesting part is that they actually have canines there as well that is managed by a third party to go through sniff some of the packages, just in case there's a little bit of questionable material in there that the canine is right on site. It's managed by a third party that can go up and inspect those different packages. I thought that that was really cool, that it's just, you know, it's a DHL warehouse. You didn't expect to to see a dog, kind of sitting in one of the cages. Now, when we walked by, there was no dog in that cage at the moment, but then when we came back around at the end of the tour, there was a dog that was in the facility, and he was a little grumpy. Otherwise I would have gotten a video. But I mean, if you're a dog working in a warehouse facility and you have to help with 10,000 packages an hour, I might be a little grumpy at the end of the day too. So no shade to that dog, but it still counts as a win in my book, because we still got to see the pup. And it was really cute, blonde, white Labrador, I think, yeah, it was definitely a lab, but I don't know what the actual phrase is. You know, there's chocolate lab, but is there? Is it white chocolate lab, I'm not exactly sure, but it was a blonde lab. So whatever that phrase is, cute pup, but grumpy. Okay, number five on the list was also at the Innovation Center, and it was one of my, I think one of my more favorite ways to think about shipping, and that's how you handle shipping packages, especially ecom packages and dense urban environments. And this, this road, I guess you could call it a row. It's actually an E bike. It's a small delivery vehicle that is electric, and it has it's much smaller, so it can kind of go through the streets. Think of like the streets of New York. When I was I took a long trip to New York a couple of years ago, and I noticed, and it logistics. People are always paying attention to this kind of stuff, but I always wondered, how, you know, how do they get stuff, you know, big trucks and semi trucks, like, are they regularly driving around the city sometimes? Yes, I did see a bunch of flatbed trucks that had, clearly, some, you know, building supplies like concrete pillars and things like that. So I did see a big truck like that, but overwhelming majority of regular deliveries, you will see the E bikes everywhere in a city like New York. But then you'll also see bigger trucks that will park off on the side of the road. Then they unload whatever packages into a smaller delivery truck. And then I saw that same delivery style truck that would be in another part of the city, and then they would be unloading into even a smaller vehicle. And so for and then from there, it could go from not just a smaller vehicle, but then one of them, I don't it's like a pallet jack, kind of not a pallet jack, um, it's a smaller cart that they're taking a lot of the packages and putting them on that cart. Now, to kind of skip a lot of those steps, is a an electric vehicle that was developed by writer so. A it's our right old, I should say not, because right old kind of sounds like writer, but this is right all so R, Y, T, L, E, and it's an urban delivery bike, and it was awesome. So it was really, really cute. It will have a video up on the screen, because I definitely took a video of that. But it was, I that kind of delivery innovation, I think is fascinating to me, because we talked earlier about, you know, being able to save the HA, you know, second and a half of being able to reach into your pocket to grab a barcode scanner. When, why don't you save those couple seconds and use a Pro Glove and scan it like Iron Man instead? Where, this is another innovation, where you can have those facilities, those mini logistics hubs, in a high density urban area where a big truck is going to take a lot longer for them to maneuver around that kind of traffic, all of those people in order to sufficiently make deliveries. But there's also warehouse space is a little challenging to come by in big urban environments. And this is not just, you know, speaking from a New York perspective, but speaking of, you know, cities all over the world where it's these high density urban village, not villages, but urban environments, also where cars and trucks just can't go because they're, frankly, too big. And so you come up with a system like this, like the Rideau urban delivery bike, and that can make the delivery process a lot more smoother, where you can hopefully save not just seconds, but minutes, maybe hours, in order to make the shipment process a lot more smoother. And when it comes to e commerce, I've said it before, I'll say it again, the every little innovation matters. So that was really cool to see, all right, and last on some of the really super cool things that I learned, but number six on this list is a lot of the real world innovation labs that are going on all the time within DHL. So we've talked a bunch about all of the minor little issues that or minor things that DHL is optimizing and innovating on. But then at a bigger scale, they have what's called the industry trends report. And so they track 40 global logistics trends with 139 use cases, and they track it all on their website, so they're very public with a lot of these different trends, and they will they will pop up. They will be removed just based on what people are talking about, what people are investing in, and where they see the future, kind of going. They release this report, I believe, every two years, in order to help folks think about the future a little bit more think about their planning a little bit more, because there were several different moments, and I'll get into it in just a second, with other different sort of sustainable materials and things like that that they had within the facility. But the innovation labs report, I thought, was really fascinating, because it's not something that you have to go to the Innovation Center in order to read or an eater in order to digest. You can actually go to the DHL website. It's called the logistics trend radar, and it's 7.0 and it has basically a giant circle where they have social and business trends on one side, and then they have technology trends on the other side, and then at the top they have high impact, and at the bottom, that they have low impact. And so all of those different I think it was, what did I say? It was 40 global logistics trends with 139 use cases. So those 40 logistics trends are all placed within that circle based on a variety of different metrics of who they're talking to, as far as customer wise, investor wise, and partnership wise, and things like that. So that report, I would highly encourage you to go and check it out. I'll link to it in the show notes, just to make it super easy. But it was really, really cool to see a couple of other really, really cool to see items before I get into the food part of my trip is it's called coconut husk packaging, and they use it as an alternative shipping material. Now, when you pick this thing up, it looks it kind of, I mean, it looks like a soil type material. They had everybody kind of guess, you know, what did you think it was? They said it was a, you know, a tropical element. So everybody's kind of guessing. And I'm like, oh, it's palm tree bark. And they're like, Ah, nope, close. But it's actually coconut husk. And so when you think about the amount of, or, I guess, kind of the, well, I'm in Florida, and so I when I say, I when you think about how many coconuts are actually consumed, they're they're consumed a lot, but maybe that's just because of where I live, and you can just, you know, kind of go around the block and there's people like chopping coconuts in half, and you can have coconut milk on the regular. I don't particularly like a lot of coconut milk. It's just not my thing. But I think it's cool that that still happens, and that's super hydrating and all that good stuff, but that byproduct of the husk just goes to waste. And so. It's really cool that they are looking at using that material as a sustainable packaging material. Being able to take something that's a waste product and turn it into something that's useful is always a win in my book. And so I will make sure that we put something up on the screen in order to display that because it was really cool looking, I would have never guessed. But now that you see the color, you probably can can see it a little bit more of you know how that product, I mean, it looks it's the same exact color as the outside of a coconut. It's just made into different sustainable packaging materials, and DHL is testing using that. So I thought that was cool. They also had a section of the innovation center that was dedicated to sustainable shipping media there was especially when it came to the tour itself. There were several other media members there met a whole bunch of new people that I didn't know actually covered anything logistics, and it was cool to see their reaction. And there was even one journalist in particular, I think his name was Aaron, and he said something that stuck with me, because he was talking about the innovation center was really cool, but then going to the warehouse and seeing in action was where it really clicked for him of the different processes that all take place within the shipment journey, and how these tiny little improvements can really make a huge impact on the entire process. So that was really cool to meet him. Also shout out to my friend Mary over at freightwaves. She's hosted check call, seen her a bunch. She used to work with her over during my time at freightwaves, we actually ran into each other on the elevator on the first day of the tour. So we were all staying all the journalists and the writers and podcasters and stuff were all staying in the same hotel, and as I was taking the elevator down to go meet everyone for the first time, she jumped on the elevator with me, and it was complete shock. So it was really, really, really cool moment to be in a different city and running into a colleague that used to work with that you had no idea was was going to be there. So shout out to Mary. It was really, really cool to see her. And then there was also just a bunch of, like, retail writers that not a bunch there was, you know, I think there was seven of us there, and then a handful of DHL reps who we kind of hung out with the whole day. So it was cool to be around other media members and see what they thought was interesting as well. And so I'm sure that they will have a bunch of stories coming out. I know DC velocity was there, obviously freightwaves was there. Eugene from robot report was also there. And so if I come across any of their reporting from their tour as well. Be sure to link it in the show notes, in case you wanted to check their workout as well. But that was really, really cool. But now let's get into the fun stuff, and that is the food conversation when it comes to Chicago. Because one thing I have, I've never been to the city, and this was my first time visiting. Like said, I didn't get to do much, like touristy stuff, but food was a big thing on my wish list, so I wanted to try as much as I can, as much as I could. I was only there for two days, so I, you know, limited time to to check out some of the stuff. But the first thing I did whenever I checked into my hotel is I asked the front desk lady, I said, Where is the best deep dish pizza that I can get? And she said, giordanos. She gave me a menu. Told me that they deliver it. I said, Perfect. That's exactly what I'm going to be ordering for tonight's dinner. It was fantastic. So much so that I have since geodornos, giordanos. I'm sorry if I'm mispronouncing is Chicago people, please don't come for me and come from a throat. Giordanos is the correct way to pronounce it. I believe, again, don't kill me. But they also ship. And so coming from, you know, the Chicago probably the greatest shipping hub in the world. A lot of people call that freight alley, not necessarily Chattanooga, sorry, Chattanooga, but there's kind of the competing freight alleys of Chattanooga versus Chicago. But I got some pizza shipped from giordanos directly down to Jacksonville, Florida, and so I was able to share that pizza experience with my husband, and he absolutely loved it. We still have two more pizzas to go. So we got the three pack. It was my husband's birthday recently, and so I was eight. I didn't know what the hell to get him. And so I was like, let me just get him a bunch of food. So got him a bunch of food. And part of that package was some deep dish pizza from from giordanos. And so that was really cool. So if you're interested in it, maybe if you have a, you know, little inkling for some deep dish pizza, then I would highly recommend getting that pizza, but then also adding extra sauce. That was my only minor complaint about the frozen versus getting it in real life, I guess, or getting it fresher whenever I was in Chicago is that I was able to. Tell them I want more sauce, because I I'm a sauce girl. I love pizza sauce. I often ask for extra pizza sauce. And so if you're like that, and if you're like me, then with the frozen pizzas that they ship to you, I would just advise just getting your own little pizza sauce, and then that way you can truly, truly enjoy it, I think, in the way that it's intended, or the way that you like, what you know, whatever pick your poison. So had that, and then I was they took us out to out to dinner, to carmines. And so carmines is an Italian restaurant, in case, for folks who don't know, just for just in general, for folks who don't know, Chicago is widely regarded as one of the greatest food cities in the world, where you can find all different kinds of foods in a very short, not short distance, but, yeah, kind of a short distance. And so I had some really great Chinese food when I first got in because it's really tough to find good Chinese food. And in Jacksonville, Florida, I could find great Chinese food in New York and Vancouver, but I have yet to find any in Florida itself. And so it was awesome to get some really great Chinese food. Get some deep dish pizza. We had dinner at Carmine. I had some really great pasta. And then, of course, desserts like eclairs and, you know, cakes and things like that. But the real, I would say, winner that stole the show was the very next day, when I had to get up and go to the airport and be at the airport by 6am it was the first day that they were doing the, you know, the new real IDs that you have have to have for any kind of air travel. And so I was worried that, you know, I'm going to be flying on this first day that they're doing this new rule, and I'm going to be, I'm not, I'm going to miss my flight. I'm going to be stuck here, like I can't get I don't want to be stuck here. You know, I have a fear of, like, being stuck in cities, which I guess probably most people do. Okay, so got to the airport super early. Security was a breeze. I already had my real ID, so I just went through free and clear. Perfect. I was good. Got through super quick. And I said, Well, hell. Like, since I'm here, and I got, you know, about an hour and a half to spare, I was like, let me see if any of these restaurants are serving hot dogs, or maybe there's a hot dog specific place within the airport, and sure enough, there was a hot dog specific restaurant within the O'Hare Airport. And so I was able to have my first Chicago style hot dog. And I just want to say I am I have been so wrong about how to eat a hot dog properly for my entire life. I am over I'm 41 and I have staunchly defended the ketchup on hot dog, but after having my first experience with Chicago style toppings. I take back everything I've ever said about needing ketchup on a hot dog. I could not have been more wrong, because the perfect blend of a Chicago dog is the onions, it's the relish, it's the mustard, the tomatoes, the pickles, the peppers, it's a combination that I have said started making it home. I had it last night, another Chicago dog, where we've bought hot dogs several times, and now it's the only way I can eat a hot dog. I went to a baseball game last weekend, and they didn't have any, obviously, not in Chicago, but they didn't have all they had was ketchup and mustard and relish, and eating the hot dog felt gross, felt disgusting. I now, probably for the rest of my life, will only have it the Chicago style way. And so that's been probably the biggest revelation of this trip, Chicago style dog superiority, and then also balancing the psychological aspect of humans working with robotics, biggest two takeaways of the entire trip. And thank you to DHL for allowing me to experience all of this, not just the food, which I've raved about, but from the innovation center to the export facility. Really, really cool to see a lot of these things that you hear about that you can see videos online about, but when you see it in person, and you see the different things that they're tweaking in all areas of the shipment process, from the packaging to the scanning to the delivery vehicles, it really is incredibly impressive, I don't know. And in fact, I think one of the DHL reps confirmed to me places like Amazon, FedEx, UPS, you can't just go tour their facilities like this. DHL has innovation centers all over the world, and so it was really cool to see that, you know, maybe the innovations that might work in the Americas won't work, you know, in the Middle East, or in East Asia, or in Europe, we've talked about on this show about even just the construction of a warehouse in the United States is much more horizontal, whereas in Europe, because they don't have this room, they don't have the space, it's much more vertical. And so how. Having these different processes in these different ways to test different information innovations all across the globe. Highly impressive. Really, really thankful that they invited me to come and do this tour. Really, really thankful that they allowed me the excuse to go to Chicago and be able to eat some of this food that I've heard my entire life, and frankly, changed my hot dog life. But this was really, really incredible to see a lot of the things that I mentioned. I will link to them in the show notes, especially for a lot of the the video portions, a lot of the B roll that I took that really helps to kind of paint a picture of some of the things I was trying to explain, especially when it comes around to the air the air cargo. To be able to see the packages going into whatever that contract is, and then taking that contraption and putting it inside of an airplane like it just makes sense. And then now, whenever you see that process taking place in the real world, you will recognize all of the people and all of the different innovation tweaks, optimization tweaks that led to making that more of a reality and making it more quicker and cheaper and more efficient. And so thank you again to the DHL team for allowing me to kind of nerd out on some of this stuff. And thank you to you all for listening to me nerding out about food and robotics and innovation and shipping and E commerce and all of that stuff. I love talking about this kind of stuff. So thank you all for tuning in. Thank you for enjoying the show. Hopefully you enjoyed it, and we will have more content like this for you coming in the future, but until then, thank you so much for your time and attention and go checks. Hello again. This is the future version of Blythe coming back in order to hopefully help set up the next couple conversations you are going to hear these. I mentioned this earlier in this episode, talking about the presentations and the DHL speeches that were given during the Innovation Tour. And so because, you know, our amazing podcast editor, Josh was able to clean them up really well. Now we have them available at the end of this conversation, which is not necessarily end of it. It's actually the start of a couple more talks, but it's the end of the first part of the show. So if you would like to listen to what some of these DHL executives have to say, especially around industry trends, logistics trends and some of the other questions that were asked during the process, then I will go ahead and let y'all listen to that. Now,
Unknown:
43:55
from my side on council meeting research COVID use case for innovation centers, it's a pleasure to cover the world and visit the team. Very happy to be here with you today in Chicago. What I want to do is broad, broaden the perspective a little bit so much focus on AI. I want to share with us in media, which how we are looking into the future with the future logistics. But then I want to bring it back to AI, is telling us about AI, and also provide some examples where you feel some stocks that we have today, because AI is obviously the whole important topic. So looking into the future and research is not an easy job to do. Some say before trusting is a risky business. However, you see here that in the tools, there are tools out there that can help. Not all tools are perfect opportunity. We do have a tool that enables us and our customers to identify the right traits and focus on the right flights in the next 10 years. So let me, let me briefly explain to you the logic of the logistics radar. So you are looking at version 7.026 radar that we launched in September last year, set four key trends that we have identified as most relevant for logistics so clearly, not only for us as detail, as a logistics service provider, but also for our customers through the logistics function, very briefly, on the concept of the radar, We have three dimensions that we are looking at. So the left hand side, type of trends on left hand side is social, business trends on the right hand side, we do see technology, things. We believe that both categories are equally important, although what we do see there's a natural focus towards the right hand side of the trends. There are those techie those may be more tangible topics. By no means machine is for the left hand side, which is much more and I'm prepared for much more strategic for the customer. So that's the first dimension. Second dimension we are looking at speaking and. End of these trends on logistics, and the logistics function, as a general rule, the higher a trend moves towards the top middle pieces here, the more inputs this trend will have. And last, not least, we're looking at a time frame of 10 years. So this red stock in the middle basically, is the moment when a trend is not a trend anymore that becomes common business practice. And as a consequence, you can see, we look at inner circular trends that we see materializing in the next five years, and in this outer circling those trends that we see materializing. So with these three dimensions, what's important also to recognize this. It does not give you an implication on what to focus now and on what to focus in the future. There are some trends that we can see materializing your ideas, but our customers and virtual customers to look at these already. This is the idea you also see on the right hand side that's in version six and version seven, we have removed some trends from the radar, and there are different reasons why we have a trend. And the most valuable reason for the tracks on a trend in common. Business practice, for example, clouded APIs, that is just everywhere. Print, covers, which is just and there are other trends that we have removed, because we see no significant development in the trends that we anticipate. And two systems is a good example. Is about cargo, underground. You might have seen hyperbole, just one example, but three years ago, when we developed the last version of COVID, it was a big topic, big investments promised to go into that. And also those are marked here. In this latest version, we see some newcomers, some new trends coming to the radar. Typically, what happens with new trends is not so much that there's this great new, extraordinary topic that nobody has ever seen before, but it's rather significant development within a topic that was well trained before, or is one of my team members responsible? So a couple of years ago, the trend of robotics exploded. It's just bullets outside for this version, clearly we saw an explosion. So AI has been on the train data for a couple of versions already, but, yeah, significant development. That's why you see addition in terms of AI. Other part is sustainability, same here, or at least it's the very first version of sustainable Logistics was on the radar about how we see this developing in so many different knowledge and sustainable region. So we felt we have to keep more detail. I want to invite you to have a look at the radar. It's publicly available on our website. There's a reason for that. We do believe in a very open innovation approach. That's why we're very openly sharing all our research and all the learnings, you know, we get from all these equations. This is a, this is a proven, a proven approach. It's to our benefit here is also benefit of our customers, universities using COVID. There's a lot to explore. So folding trends very detailed description for each trend on that website, you find 139 use cases for all these trends that we have identified from already here today, in the future. So please, please have a look. It's not meant to be a book that you can read. Download a PDF that's 200 pages. You can do that. I had to do it, but you should actually again. I want to emphasize the fact that this is a tool. So two, we want our customers, our stakeholders, to use to come back whenever you know they are interested in a certain topic or they want to see yourself. Emilia, already mentioned, sustainability and AI, the two top topics. One thing I want to, want to ask today is, you know, some, some topics like discussed today as well, bodies and elevation. You know, they they moved a little bit into background of things for sustainability and IP so probably for logistics. This is still one of the top topics. Same old is true for IoT as well. So today we want to talk about, talked a lot about. AI already, and as I said, I want to show like what certain structure, the one thing that we found that maybe not expectations today already, there's so much more to AI and just change AI and just generate, just change. It is big. It's also big for logistics, like for other industries, but it's one part. The other part is the AI analytics to the next level as well. The third part I want I want to emphasize on the left hand side what ai ai does for us, which is it helps us to acquire data, so data we did not have before, but then could use organic applications for AI applications. So generating the right AI is a core element for us, and there are different ways of doing it. So when you look at the definition of AI, the definition of AI is basically it's an intelligence computer system that is mimic human beings. When you use that definition, that logic in these certain areas, that what I tried to do here is showing the different elements of AI and how they fit to us. So AI analytics, the next level of big data analytics. You know how brain has processing data from pure vision? You are the term today already as well, our eyes screening the environment and acquiring data from from what we see, audio AI, our ears listening to the environment. One example, already listening to the environment, again, acquiring data that they can be used before. Gen AI Mike was talking about this in many different aspects, and last but least, also trend operator AI ethics. So we do see that trends need for ethical use of AI security. Cyber security is one aspect in that AI systems bias, for example, is another one AI regulations coming up so a left hand side track or social business that I think should not be forgotten. Give you a glimpse of maybe cases that we have not not seen so far. Within these five levels are just three. One is on AI analytics, and we see here, this is a huge supply chain solution for inventory optimization. Obviously, it's a data driven assessment of inventory for our customers, which is data analytics. Ai comes into play when we lift this to the next level of analytics, and when we have systems AI enabled, systems that give recommendations, recommendations for our colleagues, for decision making, for the next level. Obviously this helps us with efficiency, us and our customers. We customers. Second computer vision and Esther is going to talk about one more example. This is an example a project we built for load field assessment of trucks using a picture of a normal mobile phone to assess the fill rate of a truck. Data differs little bit that something percent of all trucks run idle or half full, with a huge efficiency. Efficiency case possible. This is one way of using computer vision, again, acquiring data from ages. Another way of doing this project we did in Singapore is for inventory. Inventory counting in certain situations, but generally accumulation using the light footage and pictures and last but least, maybe the most exotic part for some audio. Ai. This is a project with a startup called Tinman. This is a box that not only has addressed also so it's using microphones and sensors. You put that box on the conveyor belt, and what the box does is it's really neat environment. It's listening to that conveyor belt. And another part for where AI is really powerful is AI is great in identifying anomalies. So yeah, I might not be able to tell you what's wrong, but I might be able to tell you that there's something wrong or something different compared to the normal environment. This is exactly what the importance does. So it runs on the computer. It identifies sounds or vibrations that are not normal. Money, and of course, this gives us the opportunity for political maintenance to reduce downtime, increase the efficiency of businesses. My last point, I feel, is also really important when we talk about all these technologies. You pipes. We did a study on the future of work in logistics. You want to use the results of that study as a reminder that Logistics is a people business, and it's going to stay a people business, that's for sure. So we're talking about services being provided to our customers, being delivered by people. And if you bring those two elements together in business, of all these technologies, and it's really important to take these topics along, where we implement these new technologies, these new solutions, what you see here is a finding just a little so so looking back, actually, the experience of people we surveyed, 8000 people we surveyed is very possible. So 90% see technology being helpful, looking back, looking into the future, or there's a certain fear, more than 50% it doesn't matter. Office operations believe that all those technological advancements are, or could be, threats to your jobs. And this is something you'll be happy, not only very low for the full fledged open implementation of new technology. We already recognized this pilot project that Mario was mentioned pretty much every technology in China, or proof of concept project very easily turns into a change management project. I wanted to make that point, because technology is all over the place, but we feel this is equally important, especially for people. I want to, I want to know Professor Richard Wiley, refer to him as the supply chain, is that competition is not so much about competing with companies thinking more, but it's part of competing. Supply chains have been a very visionary statement here a couple of years ago. You know, we couple of years ago with the resilience topic coming up with the pandemic, was just overcating. I think we all recognize the importance of the supply chains, and this is where we want to contribute, with our foresight and with the projects we do to help our customers compete on their do. I close here we take all this foresight. Thank you, everyone. My name is Vanessa tomato. I'm the senior innovation manager on the classes team responsible for helping lead the Americas team for innovation and trend research, so identifying these trends, fulfilling advancements that we see out there, and then working with emerging partners with established corporations to try to bring that innovation in house. So today, I'll be talking to you about this open innovation process that class alluded to, how we work with our partners. We at the Innovation Center, we talk a lot about innovation from partnership. At least within our innovation team, we don't focus on R and D or M and A, but other partnerships and working with these companies and working with them and conducting pilot projects to assess their technology, assess feasibility, viability, and so today I want to talk a little bit about that process as well, but before we get there, one thing I want to talk about is just the importance of having the logistics trend radar and what that means for myself and for our team here. So this report goes back to over a decade or the tool that Klaus alluded to. So every two years we do update from the disinformator. Klaus mentioned what has changed from the last edition in 2020 to 2024 I just wanted to give you more of a timeline to showcase the fact that we've been thinking about innovation for at least a decade in association with these trends. And with that, another offering that our team provides, again open to the public, are these trend reports. So very deep dives, deep dive publications into specific topics that are looked at, logistics trend radar. Our most recent one is the supply chain diversification Trend Report. So if you want to understand more about ear shoring, Omni shoring, what does this actually mean for logistics, for supply chains, what are the opportunities? What are the challenges within that that's also available as well, and for our team, I think it's just so important to have something like the logistics trend radar. Because it provides a common language before coming into control, I would say robotic solution and say, Ah, that's just the bot, right? But now, with having the logistics firm radar, with having common terms, common language, now I can actually talk to providers and say, let's talk about your kind of this local robotic solution that has a kicking use case. So you can be very specific and save a lot of time, be more efficient in these conversations, and be able to curate that a little bit more appropriately as well. Behind me, we have our innovation funnel. It's how we approach innovation here at AHL. It's our process within our innovation and trend research team on the left hand side, Klaus talked about thought leadership. So what you see in the red ring there is our logistics trend radar. It's our North Star. It's the way we communicate and the way we're able to structure these conversations that I talked about in relation to these pilot projects. The second piece, the yellow ring, is where we are today. So those are our innovation centers. These are the exhibits and the customer engagements about where we're sitting at today, and the conversation that I'm covering now is the third ring here, the proof of concept and the pilot projects. Proof of concept, essentially, it just proves the concept, you know, is, is it actually? Does it actually work? And the pilot project, I like to think about it as a fit. Is it fit for use? Concept? Make sense? Does it work? Yes, and if so, does it work for this particular use case or this specific situation? So just wondering, provide that terminology, and within that, like every funnel where we hope to get at it is the product, productizing and scaling, essentially ensuring that anyone within DHL can adopt these technologies, bring them in house and be able to scale that across the enterprise here. So within that, a lot of the work that we do within my team centers on these innovation projects. We've heard that quite a bit throughout today about, you know, the importance of doing these small scale tests. And for me, you know, having these tests are so paramount, because when we work with small with Florida, essentially it allows us to test a lot of solutions in real time, allows us to mitigate risks, allow allows us to understand whether there is feasibility that does it actually work, and viability knows it's successful, or what it's supposed to be there. So for us, innovation projects are time bound initiatives, again, designed to test the solution in the real world environment. And I just want to remember that for us, what's pretty great. It's not just theoretical. Emilia also talked about staying close to customers, being close to operations, being close to technology. So very fortunate to be able to go out into these warehouses talk to frontline operational leaders about their challenges, their pain points, actually understand what's happening on the ground, and so within that, it's really great to actually be able to deploy these tasks in a real world environment, whether it's high stakes that are costly, high benefit, or able to adopt and gain some efficiencies through implementing that. So behind me, these are our ingredients, essentially what we need to have in a successful project. So as possible and behind me, we have that. We have, essentially, we work with the visionary customer. So this could either be a business unit or a direct DHL customer that is willing to take on and want to endeavor with the innovation project, the second piece of the DHL operational site here that's ready to test and learn. So as I mentioned, our team does travel across the Americas and try and we try to find those sites that have capacity are interested in adopting this innovation, and within that, we work closely with them to achieve that. We also work with our solution providers. So we need them to be able to bring that solution to us. Sometimes that could look like software providers who are looking to work with us to update our technology, or it could also be part of our it could be a combination of both as well. And Mario also showcased some of those different technologies today on the floor now. Last but not least is one of our team members. So I do have a counterpart in Singapore, in Germany and in Dubai. And essentially our team members also do this work globally. So what's pretty great is, if we identify something that works really well, we can scale that across our different regions. And at the end of my presentation, actually, we'll be showing you a solution provider that we're very proud of, a computer vision AI company that actually went through our process and went through our entire funnel, and now we're very important to be able to scale that across enterprise. So here, I just want to provide a quick diagram, a process that outlines how we actually work through innovation. What are the actual steps Ernesto actually happens? You know, when you find a provider, you know, what does that look like, actually, in practice? So behind me, I provide four examples, cost of wooden TV loading and transit inefficiencies. You talked about using computer vision to load that. So I put that up there as an example. We also have unsafe lifting practices. A lot of priorities to take care of our people when they're bending down doing a lot of that heavy lifting. So that's another need that I put out there, capturing dimensions of non. Conveyable items. We talked about that earlier, when we were using the multi dimensioner And then attracting high value shipments through our IoT. So these report examples of different solutions that we that we have, excuse me, brought into the DHL ecosystem and that we've tackled. So where all this starts with this process. It starts at Discovery. It's truly understanding what is the problem, what is the pain point that is happening. So once we have a game site, once we have a stakeholder, we go out and try to identify and talk to a lot of the on the ground leaders to try to understand, you know, how much information can we gather? What are the challenges that you're having on the ground? And within that, we're able to do customer interviews, we're able to sit down with them, we're able to do gamble walks, to walk through the warehouse, try to document as much as we can. And so a lot of that, we call the discovery piece, you know what? And so within within this particular stage, we also take the time to ask our stakeholders, what's important to you? What does success look like? You know, what would it look like to bring in a solution provider? What's your what's your future state? And this is really bridging the gap between where we are now, where we want to be, and so once, once we complete that piece, to go into the solution identification mode. So now this is a really fun part for me. So we do the desktop research, we go out to conferences, we go out with our partners within our innovation ecosystem, some accelerators and VC companies to try to understand what's out there. What are the solution providers that are addressing these issues, related to computer vision, related to sustainability, related to packaging and with and what we do is we invite them in to engage with us. We actually have a really great landing page called the warehouse of innovation, where startups or established corporations can actually directly partner with us by filling out an intake form, and that directly goes to our team. And so we look through, we'll look through that and essentially make an assessment and invite those companies to come talk to us about their solution. Talk to us about their strategic roadmap. You know, why are they? Why are they specifically focused on logistics? You know, what is their their regional capability? How simple visibility solution? So we have a lot of conversations with the startups in order to assess their readiness. And so within that, once we identify the problem, once we have the solution, we conduct the Fit assessment with our stakeholders. Now that we have a solution, does it in fact meet the problem? So this is the problem, solution fit that we try to look for to assess whether the solution identifies the needs, the goals and the capabilities of what our partners are looking to do. And also within this, we do a lot of collaboration work, again, with our stakeholders, and truly try to understand, is there a business case for this? Is there a return on investment? You know, it might be nice to solve that need, but we also need to make sure that we are looking at budgets, looking at timelines, ensuring that this is the right time and place for us to implement this solution. So these are some of the things that we look at as well. Next is one of my favorite parts. So this is the pilot testing. This is the part where we're able to go out into the warehouse, out into the dock, out into the facility, and conduct this test. So this is normally it takes a couple of weeks to go out on site. We invite the solution provider to come into the warehouse, and we conduct a test. We develop KPIs to try to understand, you know, what is our baseline? What are we testing for? And at the end of this week, at the end of this couple of weeks, we've gathered that they use your feedback understand whether the pilot and whether the solution actually resolved the problem it was meant to solve. And that really culminates in our recommendation. So this is a report. It could be a report. It could be just a final closeout meeting where we gather all these insights together, packed it up very nicely and make that recommendation go or no go just based off how the on the outcome and the evaluation. And so these are, again, the five stage process that we walk through with, with the companies that we partner with. And next, I like to show you a video of a company that actually has gone through these different five stages. And I'll go ahead and let that play before we jump into our Q, a, community at DHL, safety is a top priority. Logistics is a people business, and we keep our employees well being at the forefront of what we do. This includes leveraging our existing ecosystem of innovative startups to further improve employee safety with this goal in mind, DHL first partnered with protext ai on a proof of concept in Denmark to test Protex AI solutions ability to enhance employee safety. Denmark. Daniel is now running a second pilot at East Midlands and info Airport. Protext. Ai is a computer vision company founded with a mission to revolutionize how safety teams make proactive decisions that lead to a safer workplace. Our technology integrates with your existing CCTV systems providing 24/7 visibility into unsafe events and behavioral trends that allow you to identify risks before serious accidents occur. Once safety rules are in place, Protex AI will autonomously identify risky events such as near misses involving workers too close to forklifts or even climbing over conveyor belts. The new pilot is four times larger than the Denmark operation, integrating faulty cameras across the two sides. The expanded pilot aims to firstly test the solutions, newest capabilities, and secondly, to assess its scalability for potential global deployment across DHL operations worldwide. Recently, our product team has launched exciting new features, including our Gen AI tool, copilot. Copilot empowers teams to quickly obtain specific data insights in the format they need all within seconds during the initial proof of concept in Denmark, the solution was capable of blurring people's faces. However, upon recognizing the business needs of DHL Protex, further developed the de identification feature, avoiding the specifics of individual identities to maintain worker autonomy and trust, the system can adapt from unblurred facial and body recognition to complete anonymization, aligning with our privacy needs, leveraging AI to enhance best work practices is part of a wider trend called Computer Vision. Computer Vision has been identified as a high impact technology for logistics by us on the trend research team with a growing number of applications tailored for the logistics industry. This trend is becoming increasingly influential in shaping the future of work. DHL embraces cutting edge technologies while keeping people at the heart of logistics by partnering with innovative startups like Protex AI and fostering close collaboration, this is key to delivering excellence in innovation. It allows us to acquire learnings from real world deployments collaboratively develop features and scale solutions across our global network. We welcome startups to reach out and explore how we can work together to shape the future of logistics. Two things that stand out, one of them is collaborative development of features. So what Emily pointed out is also being able to learn and provide feedback to some of our technology providers, essentially helping them redefine their offerings, their solution and ensuring that they can achieve that product market fit, if you will, by working with DHL. Also, what was great about this is that Emily was able to take this from Denmark to London, and then now globally, and being able to showcase the solution. So this is a really great example of just one of the solution providers that's been able to scale and has been able to grow through some of the partnerships as well. And so with that, want to take you through your time. We're going to move directly into the Q and A and you can go ahead and get started. So I invite, yes, so Klaus, sort of sto and I are here for the Q and A portion. And yeah, happy to answer any questions that you might have surrounding the Innovation Center and what we've spoken about today. Go ahead. Oh, I was gonna say when it comes to the trend radar, how do you guys begin to like, try to find out what's going to be on it, what's going to be in it. Is it something as simple as like you just kind of survey your customers, or is it a feeling? It's a lot more complex than that. What is kind of that, that process to identify what those trends are, and if something should still stay on the radar? It's a great question that's quite often it is, it is, first of all, it's based on what learning here from our ecosystem. Yeah, we saw the 14,000 visitors coming in and speaking companies as well. And what we learn from these engagements, it's what we learn from from startups and social providers in the processes. Providers our research as well. Then the first step is bringing this all together. The good news is a good part is that, of course, we started out with border radar with one current version. What we then. Do is we double check, well, what we learned and how we would do things with our stakeholders. To give you a number for this version of the radar, we align with 250, plus stakeholders. That's internal experts. Obviously have new audience experts in ours, right? So we align. That's academia. So it comes down to managing that ecosystem and getting out that knowledge. And not so much like surveying. It's generated by the systems. It's much more experience based database, which is a strength other solutions out there, database which is absolutely fine. Regards to class in regards to the sound AI and being used in the warehousing, whatnot. So the way that that works, once it's fully operational correctly, you send it down, and it would then hear all the sounds and like people love that, and then share 100% spawn. But, you know, depending on the operation, you will send place that box every week or every month, and it does exactly this point. You know, from a normal state sound vibrations that are normal recognize signs of operations and density generated something as well. Again, it's down to the point that this AI system is not recommending words to do identify exactly like applications, not knowing what it is. How do you decide what to implement? As far as the trend is concerned, country to country, and is there a certain trend that works in one area of the world but doesn't necessarily work in another part of the world? That's two parts. One is the how to decide when it comes down to the business case and it comes down to the user of the technology might be the technology, but there is simply someone out there using the technology. Is an acceptance and obviously a business case. It is really widely have to showcase to our colleagues on site that this solution makes makes sense. So that's one your question on the application, yes, of course, also comes down to the business case. I would argue that the trends, for the most part, they are relevant in all parts of the world. However, the impact differs across across the most popular example is automation and robotics. Of course, high cost countries and region of this world, the impact of central global is so much bigger. Our impact of efficiency is so much bigger than other parts of the world. Tried beginning to certain degree also to regionalize the radar, but we recognize that it's probably the wrong the wrong level of doing X, and we rather, as MVP mentioned, that goes down to the customer level, and develop a customer trend data very specific to that customer, and stick with the radar important partners. And partnerships. I'm sure everyone wants to be a partner. What's your rate of turning people away? Or what do you do when a company getting five pitches for AMR or the MSRs? How do you some values. I mean, what's your rate of protection? Yeah, I can start and then perhaps last piece here, I would say that a lot of the partnerships that are successful are those that have a specific need. So we talked a little bit about if there are specific pain points within an operation that that makes us, you know, it'll make it easier to then provide our stakeholders five or six solutions and be able to benchmark them and say, Hey, let's try to test these six that are out there. And. I think, to your point about established players, you know, specifically with like AMRs, I would say that we have a very we have a we're fortunate that there's also a lot of innovators within the BHL ecosystem. There's different centers of excellence. There's things that are just focused on robotics, on automation and the like. And what I would say is that, you know, we're fortunate enough that these are the teams that are out there specifically testing the use cases, talking about, you know, what's the likelihood of, what are the risks associated with the financing around some of these solutions? And so within that, all that to say is that we work very closely with these internal business units that are already doing a lot of that due diligence, essentially on behalf of the organization, to assess risk specifically. And also, on the second piece about failure, I don't have a specific number in mind, but wanted to see also there was any other piece on that in terms of, you know what works, what doesn't work, I would say at least for pilots that are not successful, one of one of the benefits that we have is that we have a lot of resilient partners that are able to go back to the drawing board, amend their solution, tweak it a little bit, identify areas to either be compliant or find ways that it can just meet the specifications and the needs of that operation. And so we found that again, co developing solution for it and feedback is something that our partners want to stick with us for the long term, exactly to your point of wanting to have an EHL partnership. So it is a lot of ebb and flow. There's a lot of learning, and as we mentioned, even behind us, sometimes it takes more than one pilot to be able to assess how successful something like that. Just one addition. It's a great question. It's also the point that, you know, I think that pilots are always successful, even if we figure that this solution did not fit that specific use case. Now it is a great learning for us, and yes, it could have been the wrong solution, the wrong use case we were looking at. Sometimes it is also too early for a certain solution, and we have the opportunity to pull together. So this is like, this is a recipe of each other into the future. We have the freedom to do exactly this right. So to do this pilot and to learn from our pilots, even if it looks not successful, but to learn from it even benefit from that learning momentum process, a lot of the tip we take to go through the entire process from identifying the main points, actually hard to tell, very hard to tell. I would say something between six and 18 months, but it heavily depends. We have a repository of use cases of COVID status as a general rule, I would, I would argue, don't get them. Other, one other piece. You made me think about it. It also depends on the technology. So we've seen a smart solutions, IoT sensors that perhaps don't require infrastructure that need to be connected even to a Wi Fi because they have maybe like NFC readers, or even just like general Bluetooth, so something like that. That's a small scale operation. There's no heavy investment requirements. You know, we could get that done in a month or two, but if it's a robotic solution, then it requires you to shut down an entire computer, a line to be able to be compliant with some of the IT regulation. You know, then you're looking at those, six months to 18 months, I would say, also depending on what specific technology we're looking to implement, also are they showcase to people, and if, like, you could just have a mobile dimension or within a matter of a week or two by just using that solution and introducing that so okay, it really depends on the complexity of the solution that we're trying to introduce, And then also on the infrastructure requirements for innovation centers? That's a very good question, and I'm going to start off and then I'm going to hand it over to Fauci, because I think he's better than answering in fact, in answering his question. But we are the Americas Innovation Center. So we do do tour workshops in Spanish as well. We're trying to see if, in the future, we can get the Portuguese speaking person here as well, so we can tend to follow the Americas, I don't think expanding or opening an innovation center in South America as of yet, but still becoming the American Center, and keep bringing in more Spanish speakers and 14 speakers mentioned i. Of twice the size of the terminal, which is also applications as innovation into the mechanism. You see the value of exactly this across the region. So we could very well set up covering all the region in these four sectors. Time. So basically, what you guys were saying, it sort of sounds like you act as an ad hoc innovation arm for companies that maybe don't have that capability, super robust internally, just because mental health companies do have that. But how do you expect your role to change with those clients? When you think about the backdrop like macroeconomic environment United States tariffs, like do you anticipate that your clients needs and challenges and interests will be changing on the technology as they continue to navigate that or that? It will continue to be things that are warehouse focused, upgrading legacy systems like that kind of thing. I do see a continuation of that. Look at these strategic topics of our customers. We're talking about sustainability, efficiency is another one. They're not changing. And then, you know, it's very difficult. Very nuclear, company to company to us or not. It's not dependent on the environment changing, but hopefully our customers are seeing the benefits of this collaboration, foresight jobs are doing benefits from that. Sites, one more question, and I saw you raise your hand, similar to piggyback off that question. There's some with the greater public of fear or hesitation around AI and robotics at the warehouse employee level. How do you handle maybe adoption, or maybe the hesitation of adoption? I can start off, and I'll hand it over to you. But since we do have a lot of virtual content as well that we show our customers, we actually have a video with the stretch robotic arm that Mario was showing, I'm pretty sure, during talking about it, the stretch robotic garment. It was a lady that started utilizing it in her operations, and she actually says in the video that it's the best coworker that she's ever had. So it's, yeah, you can see it both ways. You know, a lot of people are seeing it as a threat. Some people that are actually utilizing it in their everyday start to see it as something that they can actually leverage and they can utilize in their paper. So production might be a little rough at the beginning, but after people see how it helps them in their daily operations, we get a lot of really good employee engagement. Is it all changing management? Change processes and communication is key. They get very openly experience what it needs. Whether we talk robotics, we're talking collaborative robotics, getting a coworker, getting through that coworker. I know there's some examples where a small, small token, it's this, it's this open communication, the experience pilots have there as well that's helping with the adoption once you once you feel and see that benefit, whatever it is, easier, safer, healthier, whatever it is. One comment on organizational change. Philosophical quote that I love is people will only support what they help create. And what's unique about these pilot projects is you have an opportunity to gather that on the ground feedback, help employees become part of that process, understand what's working, what's not, how we can tweak that. And that also helps so we don't double it down. And, you know, essentially deploy something that might have a high risk of failure because we didn't take into account employees, the sentiment, how people feel about it. And so all that to say is, you know, I'm a huge advocate of the pilot project, because it allows us to look and be able to tweak that in a safe environment, if you will, before we scale and implement that. And then those are typically the points where, you see those hesitations, and that's like, I never heard about this, right? But having those pilots and being on the ground also allows us to truly understand, you know, what's a sentiment? What can we do to better enable this? And also, just to add that there are also like, in fact, like some some rural areas where there are like, proportion shortages. So I know there's also a lot of talk about replacing people, but there's other parts, and specifically in the US rural parts, which you don't even have enough workers to show up at warehouses too, right? So there's also just that, all that to say that there is a spectrum as well of different narratives for what we can do when we think about employees, when we think about seasonality changes, peak demand in areas as well, where we need to scale up the operation. But all that to say is, you know. When we think about and work with our employees, that's typically when we see more of that buy in and that last opportunity.
Blythe Brumleve:
1:31:35
Thanks for tuning in to another episode of everything is logistics, where we talk all things supply chain, for the thinkers in freight, if you liked this episode, there's plenty more where that came from. Be sure to follow or subscribe on your favorite podcast app so you never miss a conversation. The show is also available in video format over on YouTube, just by searching everything is logistics, and if you're working in freight logistics or supply chain marketing, check out my company, digital dispatch. We help you build smarter websites and marketing systems that actually drive results, not just vanity metrics. Additionally, if you're trying to find the right freight tech tools or partners without getting buried in buzzwords, head on over to cargorex.io where we're building the largest database of logistics services and solutions. All the links you need are in the show notes. I'll catch you in the Next episode in Go, Jags, you,
