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SEASON TWO

SEASON FIVE: EPISODE THREE

HOW CAN TRUCKING RAISE THE BAR FOR FREIGHT VISIBILITY?

Required: freight carriers with access to load visibility data. No others need apply. Suddenly, shippers seem to expect carriers to know, and share, the transit story. And those who cannot rise to the data demand, lose out on the contract. The rise of the stringent shipper, is a new phenomenon. Recent advances in A.I. and machine-learning software fuel this rise. But what does this mean for the shipper-carrier relationship? Is the bar raised too high? Find out, as host Seth Clevenger makes the journey to Trimble’s 2019 Insight User Conference to talk to three industry experts about why the ability of real-time visibility is becoming table stakes in a large segment of the freight market.

FEATURED GUESTS

Bryan Coyne serves as executive vice president and general manager for Trimble Visibility. With more than 20 years of experience in the transportation industry including holding the designation of Certified Transportation Specialist (CTP), Coyne has built his career on excellence in sales and account management.

Mark Carroll

Bryan Coyne

EP. 2

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Episode Transcript

Dan Ronan: From Transport Topics in Washington, D.C., this is RoadSigns. Here is your host, Seth Clevenger.

Seth Clevenger: Thank you for listening to RoadSigns, the podcast series from Transport Topics that explores the trends and technologies that are shaping the future of trucking.

In this episode, we're going to explore the latest developments in freight visibility and transparency in the supply chain. The use of load tracking technology has expanded significantly in recent years because shippers are demanding constant visibility into the status of the shipments. And that's putting pressure on carriers and third-party logistics providers to capture and supply that information. Amazon has forever changed our expectations in a world where consumers can order products online and then track the delivery process every step of the way. It's no surprise that shippers have come to expect the same level of information from their transportation providers. But how can trucking companies and logistics firms meet these higher expectations? And how can they remain competitive in the years ahead as shippers continue to raise the bar for freight transparency?

To help find answers to those questions, I recently sat down with executives from two major suppliers of freight visibility technology. I spoke with Mark Carroll of Descartes and Bryan Coyne and Zack Gibbs of Trimble Visibility at a pair of recent trucking technology conferences. Let's go ahead and jump into those interviews.

Seth Clevenger: We're here in Denver at the 2019 McLeod Software User Conference, and we're excited to bring in Mark Carroll, director of product strategy at Descartes. Thanks for joining us, Mark.

Mark Carroll: Thanks.

Seth Clevenger: So I want to talk about freight visibility. Shippers are demanding more real-time information about their shipments, which, of course, is placing demands on carriers and logistics providers. So, Mark, in your words, just how much have shipper expectations changed about visibility?

Mark Carroll: Yes, I think it's more than just shipper expectations. It's expectations about the offering as a whole. Right. Initially, when tracking came out, it was this concept of 'hey, I'm going to look at a location of a truck and that's good enough.' Right. I just want to be able to see in real time where that truck is at any point in time as the data's become richer and more, more complex, there's more assets that go along with it. Right. So predictive ETA being able to maintain schedules, checking to see if we're going to be in compliance, kind of being proactive with a solution a little bit more. I see that evolution continuing into more of an automated environment where we're trying to become even more efficient. Now, the question around shippers and what they want to see is an interesting one, right, because it's a double-edged sword. Certainly shippers want to have better access to data knowing where their shipments are. But at the same time, there is an ability for us to now grade those shippers based on their performance as a provider as well in terms of how their dock scheduling working. Are they efficient at loading trucks? Are they constantly in detention? And I think there's some questions around how that data gets shared in a responsible way that's both beneficial to the shipper to allow them to improve, but also to the carrier to allow them to catch up on things like the merge and detention.

Seth Clevenger: Sure. And I mean, do you expect that this move toward more and more tracking, more and more freight visibility is just going to increase?

Is this going to become table stakes just to participate in the industry in the years ahead?

Mark Carroll: Yeah, we think it already is. Quite frankly, in order to conduct business, you have to be able to have the data at your fingertips. And quite frankly, it's not efficient to do it in a manual process. The ways that it was done even five years ago, having a solution in place is absolutely part of the game at this stage. And I think the goal for us really is to be a good provider as we continue to expand our network and get better and better compliance with our carriers.

Seth Clevenger: Sure. Now we see this push for more information. But how are companies really utilizing all this data? Right. I mean, where are we in terms of data analytics and really putting this knowledge to use and turning it into actionable intelligence?

Mark Carroll: Yeah, it's a great question. I think for us it's all about what that evolution becomes, right. I think the idea of being able to know a location of a truck, being able to predict when it's going to be there, that's all great. And I think that there's ways for us to benefit from that. But the next step is really taking in an understanding of carrier behaviors as a whole. One of our big forays into that data analytic space is the carrier capacity network and trying to better understand how can we predict not only where they're going to be, but where they want to go next? Right. And that has benefit to all parties involved in the transaction, whether that be carrier, broker or shipper, being able to better match carriers with the freight that they want is beneficial. Right. And so we do see a lot of value to collecting the data and trying to apply it to other ways to make the chain more efficient.

Seth Clevenger: And that will, of course, continue in the years ahead. You know, a big part of the future of software development will be improving data analytics and better utilizing the information that we're already capturing and in many cases. But I want to ask you next about another big trend that we see and especially in software development, and that's artificial intelligence and machine learning. We really see the conversation about this has increased. And, you know, it's certainly the case in the transportation industry as well. But when you think about AI and machine learning? What do you see? How do you see it playing out in terms of free visibility?

Mark Carroll: Sure. Yes. So, first of all, as a whole, AI obviously has grown leaps and bounds in recent years. I think a lot of that is due to the fact that now those algorithms are becoming more crowdsourced and able to be used more widely, whereas before you'd really have to write the algorithm specifically for your set of business, which is obviously challenging. And it's certainly a high level of expertise. You know, for AI for us, we really have to divide the conversation into what's artificial intelligence and what becomes business intelligence. Right. And how do we apply both to make the end user experience better for us?

AI is all about automation, making the system do things for you and actually going through and making you more efficient. But AI will also make you more efficient. But by empowering your employees with the data at their fingertips and allowing them to make better informed decisions. So for us, it's not a singular solution. It's a combination of both. We see a lot of promise in AI, especially as the technology continues to grow and we're excited to apply it as many places as we can.

Seth Clevenger: Mark, I remember a presentation you gave last year to TIA's tech innovation Show in Tucson and you really advocated for really more data sharing among freight brokers. And this is a huge opportunity to unlock trapped capacity on an open network for sharing information that could help everybody in the supply chain better utilized by hauling capacity that's available. Can you expound upon that? What do you see there as the real opportunity?

Mark Carroll: Yeah, look, I think our first application of an open network is capacity, but I think there are many other places that stand to benefit from that. It's interesting when you look at the companies that are getting a lot of investment from outside players, you know, their promise is automation of some of these behaviors.

Mark Carroll: The challenge that they're going to face is that they have to get a very, very large data set to deliver on the potential that they're showing. Right. The technology that they're working with is very interesting. We keep a watchful eye on what those companies do. We see a lot of promise in it. The big difference for us is understanding the value of scale.

We talk about that across Descartes as a company as a whole. We believe that scale is where you really start delivering the efficiencies. And so those open networks allow the users that participate in them to grow much quicker. Right. Get access to more data that they would otherwise have to in a traditional environment, acquire either by headcount or by going and acquiring a company. In this environment, being open and sharing allows all the parties to experience the benefits in a much more direct path.

Seth Clevenger: And what's your sense of uptake on this idea from your customers and others in the industry? Do you think that there is a more openness to being a little bit more collaborative?

Mark Carroll: Yes. I mean, I think, you know, obviously the big concern, the pushback on it is am I exposing data to my competition that then makes them stronger.

The reality of the situation is both parties stand to benefit greatly from it. Those that have ended up sharing collaborative within our networks have seen a lot of benefit. And I think we're starting to be able to communicate that better to the customer base. We've seen consistent growth in the product offering that specifically focuses on that collaboration and we continue to hope that that's going to be the path forward as well.

Seth Clevenger: Another big news item from a couple of years back when Descartes acquired freight visibility provider MacroPoint back in 2017, that was a pretty big move on the chessboard for trucking technology suppliers. But I want to circle back to that and ask, you know, where we are a couple of years later, how has that integration gone? You know, how is, you know, Descartes with the capabilities of MacroPoint added? And how has that merger transpired?

Mark Carroll: Yeah, Descartes has been a great partner of ours. You know, obviously, before we got acquired, our whole goal was to grow as quickly as possible with the acquisition of Descartes ... it added a lot of fuel to the fire very quickly. Obviously, we grew overnight, but since then we've had a lot of support from the parent company being Descartes in helping us grow from headcount and efficiencies perspective. They've certainly been contributors there, but where we see the bigger partnership is just the natural cohesiveness to our product suite as a whole. They've always been a big data company that focuses on enabling the supply chain, whether that be through freight forwarders, brokers or even shippers in certain situations. We see the data collaboration becoming very, very powerful and kind of really talks more about the last question. Right, which is being able to grow your data set and scale it is where you really start seeing those efficiencies and becoming powerful. So we've been very pleased with the acquisition process. We feel like we're fully part of the Descartes ecosystem at this point and look forward to seeing, you know, who they acquire next that can help us grow more.

Seth Clevenger: All right. Well, we'll certainly stay tuned on that front. I also want to take a little bit of time to talk about blockchain now. Of course, there's been this wide-ranging conversation, not only in transportation, but in tech, in the technology world writ large about how the shared ledger technology could streamline transactions, reduce errors and fraud. But certainly over the past year or so, so the hype has died down considerably. There's a little bit of a kind of a return. Just come back down to earth. That doesn't mean there aren't, you know, potentially real benefits from real applications in the years ahead. And, you know, Descartes, I should mention is a member of the blockchain and transport alliance. But I wanna get your take on how you view blockchain right now. What are the opportunities, you know, the realistic opportunities and where do we stand now?

Mark Carroll: Sure. So as a technology provider, the way we look at blockchain is similar to any other language, you know, within the technology space. It's something that we certainly have to offer solutions within. We are working hard to deliver blockchain solutions. The way I see it as it pertains specifically to transportation logistics is it seems like a sledgehammer when a regular hammer would do, right. Some of the promise that was offered by blockchain surrounded its ubiquity. And you know, having a ubiquitous offering is a very, very long path and very difficult to achieve. The promise was, hey, we can start speaking the same language and start sharing data across all these parties by having the same words spoken all the time. We're attacking that problem by trying to use open networks that we don't necessarily have to have people saying speaking the same language, we're converting it for them. So I think that there's certainly promise to what blockchain has to offer. I just think it's all about figuring out where it fits best within transportation logistics. And again, we're committed to doing that as a company. However, at this point in time, it's kind of a 'nice to have' rather than necessity for us.

Seth Clevenger: OK, that's helpful. You know, one thing I will say about the hype cycle is I think that there was a very good education process. I think people who know much more about blockchain than they did before and now will we'll see how it all develops. And we can have a maybe more nuanced and detailed conversation about how we're really going to roll it out down the line potentially in our industry. Before I let you go, I do want to get your kind of final thoughts on how you think this industry is going to evolve in the coming years. We've seen technology just take off and trucking is such an important part of the business now. But where we're going next? I mean, what do you see in the years ahead? How is this going to continue to change the way transportation and logistics companies do business?

Mark Carroll: Yes, I see two trends. One is absolutely technology playing a bigger role in transportation logistics. I think if you look at the industry, traditionally we've been lag adopters of technology. We haven't really been on the forefront. There is a plus to that where we get to see other industries kind of fight through those adoption curves and learn from that. I think that there is definitely a need for efficiency within the space, especially as we look at things like potential margin compression and the pressure that's coming from shippers to be more real time. I think we're definitely going to see technology continue to permeate its way into the industry. The other trend that I would say is I think we're gonna move to more complete solutions. Right now it seems like the transportation logistics space is full of fragmented solutions, right? Single solutions that fix one problem. You know, as I look at that from a sustainable perspective, I think when you look at the customers, they're going to want to be able to go to a small handful of providers that can offer them multiple solutions.

So we see that trend moving to a more intense solution as being the path and certainly one that Descartes and MacroPoint are looking forward to.

Seth Clevenger: All right. Well, this has been a great conversation. I think we're at a good stopping point, though. But thanks again, Mark, for joining us. We really appreciate your insights very much for having us.

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Seth Clevenger: We're here at Trimble's 2019 In.sight User Conference in Houston, and I'm very pleased to welcome a couple of experts from Trimble Visibility. We have general manager Bryan Coyne and product managers Zack Gibbs. Thank you for joining us, gentlemen.

Zack Gibbs and Bryan Coyne: Thanks a lot.

Seth Clevenger: So one of the trends that we've seen in recent years is really this demand on the part of shippers for more visibility of their shipments and transit. And of course, that's putting an extra burden on carriers and logistics providers. From what you've seen in the market, just how much of shipper expectations changed for freight tracking?

Bryan Coyne: Well, it's a great question. You know, when you think about the expectations of shippers, most shippers are consumers as well. They would really kind of bring in the Amazon effect of we expect to see and know where shipments are at any given moment throughout the process and throughout supply chain. So that's the same thing that our shippers are seeing and they want to have in their environment. And one of the challenges in the past before freight visibility was there were so many different places. They typically have a carrier network is made up of 100, 200, 300, 400 carriers is very difficult to bring that into one lens so that they can see across the entire carrier network where their shipments are. So that's really the benefit that visibility brings to the table. It's putting it in that one piece of glass so that the shipper can see and track and monitor the progress of the shipments.

Seth Clevenger: Speaking of the Amazon effect, people just from their consumer lives ordering products online. We just now expect to have that information at our fingertips. And that's certainly the case in commercial freight as well these days. But I also want to ask about the factors that are really driving this demand for more visibility. You guys have any additional thoughts? I mentioned the consumer element, but what else is driving this is demand for more visibility in the supply chain?

Zack Gibbs: I think it's all about the data has been there and it's been very fragmented in the past. The access to that information.

But once you expose that, you create all opportunities for efficiency gains, both on the carrier side to understand how well certain routes are being run, where there are exceptions that are occurring, where intervention can happen to make it safer for the driver and to manage exceptions on that route.

But if you're a shipper, then having this access to real-time ability allows you to better manage your operations that are manage your dock flow, better manage getting drivers in and out of these facilities, which benefits all parties.

Seth Clevenger: It's definitely a reciprocal value there. Carriers, of course, don't want their drivers held up at these facilities. So providing that information can help, not only help the shippers, but also helps the carriers. So you guys announced at this conference, that Trimble will begin offering a version of its visibility platform for free to customers, at least those customers are using a Trimble TMS system and telematics in the cab. Why take that step? Why offer a basic visibility platform at no charge for your joint customers?

Bryan Coyne: It's a great question. We really have embraced and embodied the one Trimble mantra that we've been talking about for the last year and the power of together. So when we look at the customers that we have that have a Trimble TMS and also a Trimble mobility product or telematics device, we wanted to give back to those customers and give them the benefits that Zack just talked about, but on their business so that they can provide this information to their customers in a way that they can kind of dip their toe into the visibility water per se see what it's about, see how it works for them and see how it can help them provide better service for their customers on a daily basis and really back off the amount of support they have to provide their customers. Because their customers are really getting a self-service and real-time information about their loads and shipments.

Zack Gibbs: And we think, just to add on, I think we view this as being a way to solve some big pain points for the carrier customers today. And so, No. 1, part of this announcement was giving them back control of their data with the trust center product. And the visibility product goes hand in hand with that. So, you know, the big pain point that we've heard over and over again is third-party providers coming in to our carrier customers asking for information. And then it kind of goes into a black hole, void for them. And so we want to help solve that problem for them, but also give them full transparency and access into that data. And the true visibility product is that that user interface where they can interact and really see it and then provide a better customer experience for their clients as well.

Seth Clevenger: And of course, there is a paid premium version of visibility with additional features that goes beyond this basic version that's now being offered to your customers.

Zack Gibbs: Yeah, absolutely. So there's features that we have in the premium version that add value from a weather risk scoring perspective. So if there are safety concerns along the route line, those can be bubbled up and actions can be taken along with a number of other features that we have in the premium paid version as well.

Seth Clevenger: Now, today, what do you see as the main gaps and visibility that shippers, carriers and 3PLS are still trying to address?

What are the key missing links in that, that information that would really be valuable if you could plug it in?

Zack Gibbs: So the networks are still very disconnected and fragmented today within transportation, logistics. We've always had that that fragmented problem. I think that that as things move forward, we'll see less of that. But it's still an issue today that we that we face. And so that's where connections to other non-Trimble business systems really is, is the future for us and improvements for the non-Trimble clients and the Trimble clients, that there's huge value on both sides and on the carrier side, on the third-party side and shipper side.

Seth Clevenger: So Trimble really got into ship and visibility two years ago when it acquired 10-4 Systems. And now here we are two years later.

So I want to just kind of check in on that. How is that merger played out and how are you connecting 10-4 technology to other Trimble product lines?

Bryan Coyne: Yeah. And that's what the original plan with the purchase of 10-4 was to leverage the power that we already had in our existing customer base. So when you think about 89% of the top 100 carriers in both private and for-hire segments use a Trimble transportation product, we already have a very strong customer base in transportation. So we wanted to be able to provide visibility to that existing customer base, really leverage it where the only visibility provider in the marketplace that already has an existing customer base of carriers that are both either on the mobility side or on the TMS side.

Seth Clevenger: And Zack, you made the comment yesterday morning that transparency and the exchange of data among carriers, shippers and third parties is going to be a foundational pillar for the future of improving our industry in the future. Why do you feel that way? Why is this so important?

Zach Gibbs: So, I mean, in a few ways, I think that, you know, as we break down silos and walls within the industry, there's tons of opportunity to share information that both sides win. So even if you're working with a third-party shipper, TMS, there's information that if users are opting into the services that we can escape, exchange information with them and they with us and it builds we can build better solutions for all of our customers collectively together. By doing that.

So I just think that the sources and the origins of the data are being collected. But there's very few people that are there building real industry leading solutions off of that as well. So I think it's a big opportunity.

Bryan Coyne: Just to add onto that point. There's a lot of concern with the data privacy, data security in our customers now or existing customers, whether on the TMS side or on the mobility side, they know Trimble and they trust Trimble with their data. So they know when they put their data into the trust center. As I talked about a little while ago, that it is safe and they control where that data goes. Who gets that data and how long they have access to that data. So really, data governance and data stewardship is a key. Those are key pillars in our data strategy with our customers.

Seth Clevenger: Sure. And, you know, it's one thing to collect data. It's another to actually utilize the information to its fullest and turn it into real insights that change your business processes. So how do you see carriers, 3PLs and shippers starting to take all this data that they're demanding and really turning it into actionable information to take it to the next level?

Zack Gibbs: I think first we need to solve the challenge of connecting one another together. And with the visibility component, it's not a difficult concept. I mean, we've all had great customer experiences on the personal side. So we need to extend that all the way through that truckload, intermodal, LTL, final-mile side of the equation first.

Once we do that, then there's a lot more that can be done. But that's a big challenge still today to connect those different data sources together. And then from there, you can start connecting the different ecosystems together. You've got to build that foundation first in the industry. We still have a ways to go to really get there.

Seth Clevenger: Sure. And one of the big trends in software development is the use of AI and machine learning. And we see this across any industry you can imagine. How is it going to change load tracking and free visibility? Once you start to gather information. How do you see opportunities to apply it forward?

Bryan Coyne: I think you're going to see the use of machine learning and AI on the analytic side. So when you start assessing and looking at the historical data that we're able to provide through the freight visibility in the tracking photo of it, truly help our customers understand what's going on with loads and how have the loads are progressing and what trends that the machine learning and AI can pull out of the historical data. I think that's really we're going to see the power of removing inefficiencies from the transportation sector in the marketplace. That's the efficiency gains that our customers I think we'll see. And that's the practical application, I think of the AI and machine learning.

Seth Clevenger: Before we wrap up, I want to ask both of you just how you see this industry evolving in the coming years. Do you see basic transparency becoming absolute table stakes moving forward? Is this something that everybody is going to have to do if they want to participate in most freight markets? What do you expect to see in the years ahead?

Zack Gibbs: So from my perspective, I think that, yes, absolutely, it's table stakes that we all need to provide as a standard service for our customers and we all expected as consumers. And so why should we settle for anything less inside of our industry that's so large and diverse. And so, absolutely that I think that's that's table stakes in the proliferation of IOT devices in general just over the last four to five years. And then the trends going forward and the move from business-to- business IOT devices to using business-to-consumer, the you know, the smartphones and the tablets that are more the consumer grade devices. How cheap IOT devices have become. That we're going to move away from just tracking the power unit or just tracking the trailer into actually tracking what matters within that freight visibility.

Seth Clevenger: And Bryan, any final thoughts on where you see us going in the years ahead?

Bryan Coyne: Yeah, I think as visibility gains in popularity as it has very rapidly over the past several years, I think we're gonna see more acceptance. More innovation and growth in the platforms to provide the analytical and the business knowledge to truly remove inefficiencies from the marketplace. That's I think one of the biggest challenges that transportation faces today is the inefficiencies that cause driver shortages and truck breakdowns and everything else that there are challenges within transportation companies. There may not be related to technology per se. It's just that the business of moving freight. But I think the more we can learn from the past activities and the histories of everything, the more efficient we can make this great industry that we work in.

Seth Clevenger: It'll be very fascinating to watch in the years ahead. Brian and Zack, it has been great to have you on the program. Thanks again for joining us.

Bryan and Zack: Thank you so much.

Seth Clevenger: As we wind down, let's revisit our original question, how can transportation companies keep up with shippers’ demands for greater freight visibility? As we've heard from our guests, the ability to share this information is becoming table stakes in a large segment of the freight market. If it can't provide the transparency the shippers are demanding, they'll choose another transportation partner. And shipper expectations are only going to rise. Carriers and 3PLs will need to equip themselves with technology to not only capture this information, but to share it with their customers in a user-friendly way. This is all part of a broader movement toward more collaborative relationships between trucking and logistics companies and their shippers. This enhanced transparency could lead to better utilization of freight hauling capacity across the industry. It could also start to whittle away at the problem of driver detention time, shippers and receivers facilities. The ability to capture this information is already available. The next step is to use it to enable better business decisions, closer partnerships with shippers and a more efficient supply chain.

That's it for this episode of RoadSigns, but we have a lot more in the works, so stay tuned. Until then, I'm Seth Clevenger. Thank you for listening.

EP. 3

As Director of Product Strategy for Descartes MacroPoint, Mark focuses on bringing innovative offerings to the product suite. Prior to working for Descartes MacroPoint, he held leadership roles at two growth-stage logistics providers where his primary focus was capacity sourcing. Mark hopes his experience will help to shape not only a great set of products but the industry itself.

Zack Gibbs is a senior product manager for Trimble Transportation. In his role, Gibbs is responsible for developing solutions to increase supply chain visibility and help transportation organizations leverage technology to improve performance and enhance customer service. Prior to joining Trimble Transportation, Gibbs brings more than 10 years of experience in supply chain, logistics, project management and operations from Amazon.com and XPO Logistics.

Zack Gibbs