The Platform Chronicles: 10 Questions with Bob Hitt, Manager, Industry Go To Market, Logistics and Transportation, at Salesforce
On using blockchain, A.I., and IoT in the supply chain and linking customer-facing apps to inventory and logistics systems using the Salesforce Platform.
Welcome to The Platform Chronicles, a series designed to introduce readers to some of the most innovative Salesforce customers, partners, and employers.
This issue introduces Bob Hitt and his plans to leverage his nearly two decades of supply chain experience for Salesforce. His career has spanned a variety of functions including IT, e-commerce, quality, and safety.
10 Questions for Bob
Bob’s supply chain career began in 2000 when he joined a large North American trucking company and served in a variety of leadership roles. After that, he was an account executive at an analytics and outsourcing company where he focused on clients in the transportation & logistics industry.
Fun fact: Bob began his career as a special education teacher after graduating from the University of Missouri-Columbia.
The following is a lightly edited transcript of our ten questions for Bob.
Bob, you have spent most of your career in the supply chain execution sector. What drew you to leave that sector for the CRM market?
Technology has always been a passion of mine. My IT career started in the early days when companies were just starting to deploy networked PCs.
My real introduction to Salesforce came through the Blockchain in Transport Alliance (BiTA) consortium. I was surprised to see the company providing leadership to BiTA. Amihai Zeltzer shared the Salesforce focus on the transportation & logistics industry. That focus on the T&L industry and using Salesforce to drive innovation seemed like a perfect fit for me.
If you look at the evolution of the CRM market, do you see the need for sales, service, marketing, and commerce apps to reach into back-office systems for real-time inventory availability or shipment status?
In order to meet customer expectations, CRM products — sales, service, marketing, and commerce apps — must tightly integrate with inventory, transit time and shipment status information. Salespeople need to be able to make commitments for product delivery. Service agents must be able to provide status updates and take corrective action to avoid inventory outages or shipment delays.
Commerce apps need to know the inventory levels, inventory location and expected transit times. Finally, marketing programs need to correctly position the capabilities regarding fulfillment. Customers demand this visibility for fulfillment in both B2B and B2C.
This need runs across industries from automotive to manufacturing to retail to e-commerce. The customer-centric strategies of the fastest growing e-commerce businesses have created customer expectations of same day or next day delivery.
Unfortunately, many companies do not link the inventory and shipment status to their CRM — the customer experience does not meet expectations. This level of visibility is table stakes today.
When you talk to customers and prospects about the Salesforce platform, what are some of the more frequent use cases that come up in discussions?
Transportation companies want Salesforce to help find the right customers and keep them. Every carrier in all modes of transportation wants to attract and retain the SMB market for growth and profitability. Key aspects of servicing that market include instant quotes, shipment visibility, and control tower functionality.
The industry is based on contract pricing without a specific commitment for volume, yet the contract pricing is based on an estimated or expected volume.
Transportation and logistics companies want to link actual volume to expected volume which requires integration to both operational systems and financial systems. This intelligence provides the foundation for real-time decisions regarding contract pricing, opportunities for up/cross-sell, and methods to increase customer wallet share.
Transportation companies are also interested in any solutions that help them recruit and retain drivers. The annual driver attrition rate in the USA in 2018 was 95%. The situation is quite similar in Europe.
Logistics companies want a connected marketplace that brings shippers and carriers together. Like transportation companies, they want to provide a control tower for their shippers. This involves connecting to many partners — they have a wide variety of different technologies and vary widely in their levels of digital sophistication.
The industry is heavily built on contracts between logistics service providers and actual asset owners — the carriers. Mearsk tells us for a single container shipment there are 200 touchpoints within 20+ organizations.
In both the transportation & logistics sectors, they want embedded AI and analytics that automatically kick off processes whether about late shipments, potential customer churn or damaged shipments. A Zebra study indicated that by 2028, customers will expect a 2 hour delivery time rather than the current same day or next day. Customer requirements like this will require that carriers invest in real-time data-driven technology that can predict demand, deploy inventory and secure capacity.
At the same time, customers want a smaller carbon footprint and less highway traffic.
Can you share some of the more innovative Salesforce Platform use cases, too?
Salesforce products are deployed in some of the most disruptive transportation and logistics companies. Companies such as Flexport, FreightHub, and Convoy are using Salesforce as part of their solution for industry change. A key component of that change is an intense focus on the customers.
In the European trucking industry, Saloodo, powered by DHL, uses Salesforce to provide a marketplace that provides real-time quotes and booking. In the Saloodo marketplace, trucking companies are rated for customer satisfaction so that customers can select a trucking company based on price, quality and speed. As the same time carriers can bid for shipments. Most likely these data-driven marketplaces will feed the autonomous delivery vehicles of the future with automated work orders for delivery and pick up.
Freightos developed a similar solution for ocean cargo. While this may seem like basic quoting and booking functionality, the ocean cargo market typically takes between 3 and 10 days just to provide a quote.
Finally, Fleetcheck and Geotab integrated data captured from truck engines including a variety of data used to determine the location of trucks as well as monitor engine components. Being able to remotely monitor trucks allows companies to proactively provide maintenance to avoid costly roadside repairs and tows.
Innovation goes along with disruption. 3PLs (3rd Party Logistic firms) will go out of business if they don’t shed old assumptions and processes, and move toward automated data exchange between shippers and carriers. Tech-driven companies with a hyper-focus on the customer will disrupt the transportation & logistics market and displace incumbents.
If you look at Salesforce AppExchange, there are quite a few partners who have built native transportation management system (TMS) apps on the platform. Have you had a chance to spend time with any of them?
I’ve met with Revenova and have seen a demo of the TMS they built on Salesforce. They built a solution that can be quickly deployed and is easy to use. The Revenova TMS provides small logistics companies with a great way to compete with the “big guys” with IT departments in the 100s of people.
Neurored comes with SCM and TMS capabilities. They provide a leading-edge control tower for SCM visibility and a Seamless Shipper Experience. Neurored is also investing heavily in blockchain.
Both partners are adding next-level functionality for CPQ (Configure-Price-Quote) to offer capabilities for instant quotes.
Let’s switch to blockchain. At your former company, you were involved in BiTA where you led the Bill of Lading Workgroup. How do you see blockchain’s role in logistics and transportation?
I can’t wait until no one talks about blockchain anymore. Sound crazy? Yep, I’ve heard that before. Blockchain is an enabling technology just like TCP/IP or HTML. But like those technologies, the value of blockchain is going to be determined by the uses cases that leverage blockchain. The focus needs to be on the use case.
The T&L sector needs a use case that transforms the industry just the way that Bitcoin and other cryptocurrencies are transforming money. A transportation marketplace will be that transformational use case. This marketplace will be built on blockchain technology that brings buyers (shippers) and sellers (carriers) together in a frictionless environment. A blockchain-based transportation marketplace might eliminate or change the role of freight brokerage services. Once a transportation marketplace is on the blockchain, the value will be apps developed for shippers and carriers to post loads or capacity on the blockchain. These apps can incorporate intelligence just like all of the tools that online stock brokerages provide.
Blockchain has some other interesting uses cases for transportation & logistics, but my bet is on a marketplace that replaces the hundreds of proprietary marketplaces and load boards.
In the future, most people won’t know what blockchain is, but they will use it every day. When was the last time you talked about TCP/IP?
One of the criticisms of blockchain is that most of the current activity is centered around pilot projects, not production use cases. What will it take to get broader adoption?
Right now, the pilots are just using blockchain as a replacement for traditional databases and inter-company APIs. The pilots are also using proprietary or private blockchain implementations.
Open standards need to be developed. Once open standards and transformational use cases are developed, adoption will increase. In general, the focus needs to shift from the technology to solving business problems.
Let’s talk about IoT (Internet of Things). There are software companies building cool apps that provide full track-and-trace for trucks and trailers, including location, temperature, humidity levels, traffic/rerouting, and even insights on how the driver operates the vehicle.
Given requirements like Walmart’s On Time In Full (OTIF) mandate for suppliers, I thought more shippers would want something similar. I’m not seeing it. What are your views?
Trucking companies go out of business every month. The margins are very low and sometimes negative. Because of this, they are extremely risk-averse. They don’t deploy hardware or software technology unless there is a clear and direct cost savings or revenue gain.
Twenty years ago, every package was going to have RFID. Stores and warehouses were going to use RFID to quickly determine inventory. Ocean, air, rail, and truck companies were going to use RFID to provide visibility at every step of the way. Some of the largest trucking companies and retailers experimented with RFID, but in most cases, the cost and reliability of the devices outweighed the business benefits of RFID. As with RFID, most trucking companies are taking a wait and see approach to IoT.
The On Time In Full programs of Walmart and other large retailers is all about predictability. The retailers rely on this predictability to avoid empty shelf space and to plan labor for receiving and stocking. When the OTIF requirements are not met, the retailers issue fines. The standard transit times for trucking companies will allow most shippers to meet the OTIF goals without the need for trucking companies to purchase additional tracking devices.
IoT is great for high-value goods such as pharma where regulation is in place to document the complete supply chain. An excellent example of this is DHL Lifetrack. They include IoT temperature sensors so that live-saving time and temperature-sensitive pharmaceuticals get to patients on time. The DHL Lifetrack product was developed on the Salesforce platform.
We’ve talked about blockchain and IoT. Where do Artificial Intelligence, Autonomous Vehicles, and other technologies fit in your discussion with transportation and logistics leaders?
The applications for AI in transportation & logistics are huge ranging from predictive customer churn, predictive maintenance, port/yard management, route design and management, and volume and labor forecasting. AI is an essential enabler to growing revenue, improving forecasting, increasing load factor and boosting profit margins.
Autonomous Vehicles (AV) are debated extensively in the transportation industry. Clearly AV 1–3 will happen quickly. My bet is that AV 4 and AV 5 will happen in 4–6 years. There are 3.2 million commercial truck drivers in the US alone, and the annual attrition rate is 95%. The economics of AV 5 in trucking are huge. Implementations will start on inter-city routes that are primarily interstate highways.
Once AV 5 trucks become common, the normal cycle of tractor replacement will gradually move the market to AV. This shift in technology will drastically change the role of trucking companies, and create entirely new careers in AV maintenance, security, and testing.
In my opinion, the biggest barriers to fully autonomous trucks will be regulatory and public perception. As AV 5 becomes established in ports, warehouses and other industrial applications, both the technology and public perception will improve.
The other major T&L technologies to watch are electric trucks, AV ocean vessels, drones, robots, and automated warehouses. Everyone in the transportation market is either experimenting or implementing.
Last question: If Salesforce gave you a team to build a killer app on the Salesforce Platform, what would it be?
Apps for shippers and carriers that leverages the blockchain to create a marketplace would be my focus. The freight brokerage market is too fragmented today, and the customer engagement process has high friction. A blockchain solution with supporting buy and sell apps running on the Salesforce platform would a major game-changer in the transportation & logistics industry.