We were speaking to a Global VP of innovation for one of the leading third party logistics players, and he was talking about a specific workflow process on the forklift truck driver. He can design out six seconds in one particular part of that process, but because he has that exact process happening so many times, across so many locations worldwide, it actually adds up to a massive number. Good morning, good afternoon, or good evening, wherever you are in the world. Welcome to episode 71 of the Sustainable Supply Chain Podcast, the number one show focusing exclusively on the intersection of sustainability and supply chains. I'm your host, Tom Raftery, and I'm thrilled to have you here today. Now a huge thank you goes out to this podcast's amazing supporters, Kieran Ognev and Alicia Farag. You really help to make this podcast possible. If this podcast regularly brings you value and you'd like to help me keep this podcast going, support starts at just three euros or dollars a month. That's less than the price of a cup of coffee. You can find the link in the show notes of this or any episode or at tiny url.com/ssc pod. Now you know how everyone's talking about finding smarter ways to run supply chains, while dealing with tariffs, labor shortages, and the mess of reverse logistics. Well, today I am chatting with René Schrama, who's made a career out of helping global brands automate their operations intelligently without just throwing robots at the problem. René is all about using data, continuous improvement, and even a bit of kaizen philosophy to find the seconds, not just minutes that matter in supply chains. We'll dig into why small wins add up fast, how to design out waste, and why digitisation doesn't always mean replacing people. So if you are in the trenches figuring out how to balance sustainability, labor and technology, René's Insights will give you plenty to chew on. But just before that, in the next few weeks, I'll be chatting with Pierre Lapree, who's the CPO for Spend HQ. Eric Biel, who's the Director of Strategic Partnerships for Powercast. Chris Condon, who's the co-founder and CEO of Aircon, an air freight company, not an air conditioning company. And Ollie Carpenter, director of Environmental Risk for Risilience. That's risilience with an i. Now back to today's episode, and as I said, my special guest on the show today is René. René, welcome to the podcast. Would you like to introduce yourself? Sure. I'm René Schrama originally from Holland, living in the UK near Manchester. I'm the Chief Commercial Officer for Peak Technologies, a global company specialising in digitising workflows and manual processes in the extended retail supply chain. Okay, great. And, for people who are not familiar with Peak Technologies, can you give us like a quick 101? I know you gave us a very quick 101 just now, but expand a little on that for me. You know, what kind of problems are you solving typically for customers? Who are your customers? And you said global, so I presume that's all markets globally. Yes. Correct. So we are USH quoted in the region of Boston. We have direct presence in the USA, Canada, the uk, Ireland, Netherlands, Belgium, and Australia. Mm-hmm. And then outside of those countries, we serve our multinational clients through a network of established partners, or we serve them direct from the locations that we're in. In terms of the markets that we are addressing predominantly that would be the manufacturing, logistics, parcel logistics, and retail sectors. Although we also have a pretty strong presence in both healthcare and field services. Our origins, I guess, is the, the, now I think, 35 year-old barcode Hmm. probably everybody knows from the, from the supermarket shop. So things that go bleep is the, is the kind of stuff that we started selling a very long time ago. Now clearly a lot of newer technologies have been developing to effectively capturing data, digitising that, and automating those processes as efficiently as possible for our clients. Okay, and can you give me a little bit as well about your journey into becoming Chief Commercial Officer for Peak Tech? Sure. So I have had a relatively colorful sales and marketing and managerial roles. I started off probably purely because of a work placement that I did for my international marketing studies in London, and it was a barcoding company. So there was no career planning involved, I would say. They liked what I was doing, offered me a job, and that was the beginning of my career. And since then. I've worked for some of the largest integrators. I've worked for companies like Symbol Technologies which then became Motorola Solutions. I've run my own consulting business for a period of about 15 years working with leading brands like Toshiba, Zebra, Data Logic, Honeywell. Pretty much globally. I, I had clients literally from AsiaPac all the way Europe and into the Americas. It gave me the, the opportunity to look in many kitchens as I always called it, and see how people do things and advise them on the best practices that I've come across. And a few years back, probably now five, four and a half years or so, Peak technologies knocked on my door saying, we hear you are available. And at that moment, I was just on summer holiday, so I don't know how that thought meant that I was available. But I decided that having seen so many kitchens for 15 years, it would be fun to actually join a company and start deploying all those strategies. So I joined and very quickly became the UK managing director. And then Peak Technologies was acquired by Sole Source Capital, who then effectively we were growing both organically and through acquisitions. And as part of those acquisitions, I led those in Europe. So we acquired businesses in Ireland, Netherlands, and Belgium. Been responsible for integrating, and then I was asked to look at our global sales organisation. So for a period of time, I became the CRO. Where we did some restructuring and optimising go to market strategies, and then I moved into the CCO role at the beginning of this year with the view to drive a further geographic expansion, predominantly in Europe and in Asia Pac. And on the intro call you mentioned what you called leveraging automation intelligently. So for people listening, can you explain what exactly does that look like in the supply chain context today? When we engage with our clients what we're finding more often than not is that our clients, because of the wide availability of data on the internet, have done a lot of research, but of course they come from their own business environment and their own business roles. So they have started to translate already their, business problems in what is the probable investment route from which technology stack they think could solve that business problem. So what we say by intelligently is that more often than not, we first start to explore with our customers what actually the business problem is because clearly we come from the other end. We are specialists in our field and we have probably a far wider reach in terms of knowledge, in terms of what is available, which technologies are there from an automation perspective, and then we engage with our clients to effectively determine, okay, if this is the business problem and this is the outcome that you're seeking, these are probably the two or three things we would consider. And then we go into the debate to actually intelligently apply which one would have the best outcome. Not only for that specific business problem.'cause quite often they're in a chain, so I could solve something here, which then creates a problem further down. So it's actually also making sure that whatever we drive as a business benefit, has effectively a better effect further down as well. Okay. So you're seeing a shift from full scale automation to more target approaches. Do you think that's a trend that's happening now? It depends what the starting point is. So if let's say if it's a third party logistics company and they've just won a new customer contract to do an outsourcing of a distribution hub, for instance, if that is a complete greenfield site, then effectively, they could begin with a white sheet of paper and design it probably with a lot more automation from the get go. If you, however, are in a historic site that already has a lot of investment, that that has gone into it, at that moment in time, you may be restricted by the layout of the site or what is already in the site, and therefore you need to apply perhaps in specific pockets where the automation can be applied and having to accept that in other areas you may not be able to do the same level of automation as you would do in the greenfield site. So it depends on the starting point. Sure. That makes sense. Now, clearly the vast majority actually sits in a historic site. Yeah. it's expensive to stand up a greenfield site, and if you do have a high level of automation, then the payback period is much, much longer, so it only could make sense if you stand up a completely new site. And there's a huge amount of uncertainty in global trade these days between tariffs between geopolitics shifting policies. How are supply chain leaders adapting their automation strategies to stay competitive and resilient? Yeah, it's, interesting. So clearly because they are literally our customers and when we are in conversations with them, they're quoting increased costs clearly because of, potentially just the tariffs, but also the supply chain routes are not necessarily the same as they could be. So they're not always the most efficient. As we know with the Suez Canal, for instance, the last couple of years. So there's a lot of disruptions. And also the recent amount of tariffs have actually reduced trade volumes, inter countries. To give you an idea the, the container issues that we have during COVID when the containers were in the wrong place, basically, Yeah. that actually is worse today than it was in COVID times. So in a space of four weeks the departures from the Chinese ports to the US dropped by 50% in volume. Just to give you a context. Now, basically the ships were there in China and they're in China, but they're just not leaving because they don't know if actually they can sell the goods in the US market. So all those kind of disruptions are causing a lot of issues for people that run supply chains. And now they are clearly focusing on trade agreements. At least the countries are focused on trade agreements. But that in itself still has a lot of uncertainty attached. So we are hearing a lot about companies intelligently looking at redesigning their longer term strategies for supply chain operations, where they source from, where they have the manufacturing locations. Is it a hybrid model where they are close to the market for certain core components? And further away from other components for the products that you manufacture, et cetera. So yeah, there's a lot of disruption and therefore I think everybody at the middle of 2024 was hoping that we were going into a period of stability, well that's not proven to be the case. Quite the opposite. Yeah. one day your tariffs on steel aluminum are 25. The next day they're 50. Who knows what they'll be tomorrow. Chinese tariffs. One day they're 35. The next day they're 135. Next day they're whatever else. It's, insanity. I dunno how, how anyone keeps up with it, particularly the people who are trying to impose the tariffs. Well, and interestingly, the custom departments can't keep up themselves, so they're actually, they don't know what documentation. Cause clearly we have multinational clients. We see actually some of our shipments. The rules change whilst our shipment is in transit. So, yeah, interesting times. I would say, And René, this is the Sustainable Supply Chain Podcast. So let's talk a little bit about that. How does designing out waste fit into the bigger picture of sustainability and profitability in supply chains? Well, the mere fact of the word sustainable would suggest that we have to manage our resources and I think it's no secret that we are running outta certain resources much faster than that they are available. So there is no doubt that we have to react and work more intelligently about what we do. Design out waste wherever we can and waste in the broadest context of that word. So whether that is literal waste because I have to scrap something or whether that is I take an hour to do something that I could do in 20 minutes, that is still waste in a way. But also it's about re harvesting the resources at the same time. So at the moment, there was an article, I think last week about the European markets probably in the Netherlands actually, where they are looking to reharvest far more of the precious metals because the Western economies have a lot of electronic goods that they're consuming and guess what? We tend to just throw them away and then they get shipped back to somewhere else, and hopefully they don't end up in a landfill, but it get recycled. So as precious metals become more and more scarce, clearly it would make a lot of sense to redesign that reverse logistics supply chain and actually start to re-harvest those precious metals to inject them back into manufacturing, which then triggers another interesting response because that would also suggest that the manufacturing locations probably then become closer to the markets where you get consume those precious metals. So yes, there's a lot of focus on redesigning processes, be that workflows or human processes to design out waste. And clearly one of the areas is digitisation and automation, where we are active. Okay. Yeah. But automation can often feel like it's in tension with human labor. What's your perspective on how to strike the right balance there? That's a interesting question because I guess there is an emotional and irrational reaction to that. Clearly we are, we are social human beings and we like to engage and interact with others. That's it's our makeup. It's. Who we are. And when you start to talk about robots as an example, particularly if they look like humans, it starts to all get a bit strange. However, the, the rational view of the world would be that in most developed countries the birth rate is now less than two children per couple. So that by default means we have a shrinking population. If you then add to that with the protectionism that is coming back into the economics, there is also clearly protectionism on the labor markets. So the number of visas that get issued is far less. They tend to be affecting the unskilled labor pool far more than the professional labor pool. So that therefore has an impact on the profile of the working population. And then if you add to that the growing number of economically inactive people, particularly in the younger population, which is, which is an interesting one that I have a theory on, but I dunno if it's right. You have by default a shrinking working population. So if we have a shrinking working population. And we have a higher cost base because we are redesigning a supply chain closer to the market. I have to find a way to become more efficient. And the only way I can probably do that at that moment is to optimise my processes as best as I can. And if that means automation then the logical answer would be to deploy automation. And what about things like the Kaizen approach, you know, of continuous improvement? How does that mindset influence how you think about the supply chain innovation today, for example? Yeah, it's interesting. I did my education in the eighties, so, Kaizen at this time was a revolutionary new way of thinking, but it's interesting that it is so still very relevant today even though it's about 40 years old. It starts with the premise that there is always room for incremental improvements, and it's that word incremental that is really important. It's not necessarily looking for a big bang improvement. It's about eking out every little percentage that we can find. And that then drives a culture of continuous improvement. So constantly evaluating what we're doing, what the processes are, and questioning, just because we did this for five years, does that mean that we need to do it for the next five years? And that approach is so relevant now for designing out of the waste because we were speaking to a global VP of innovation for one of the leading third party logistics players, and he was talking about a specific workflow process on the forklift truck driver. And he believes he can design out six seconds in one particular part of that process, but because he has that exact process happening so many times across so many locations worldwide, it actually adds up to a massive number. So he's given us the task to come up with, you're the technology scouts, go and find out how we're gonna solve that. And we are literally in the process of deploying a, a proof of concept for that right now. But it is that, that mindset of, I know it's only six seconds. You go, six seconds is not a lot. Right. But you start to multiply effect attached to that and then becomes quite interesting. So I think it's a very relevant way, but it's not just about the waste, it's also about process and the results that drives out of that. So, so the Kaizen philosophy has got effectively seven principles in total. Waste is one and process and results is the other one. Sometimes just a process redesign can actually deliver also a better outcome. It doesn't necessarily have to be a new automation, et cetera. It could be just doing it in a different way that you actually design out something or you improve in efficiency. And, in your experience, what's the biggest misconception that supply chain leaders have about automation? That it always is a massive project, which is not the case. Okay. And, and I think because of that mindset, if it's a massive project, from their end therefore, they have limited resources typically in their IT departments, right? So they can only handle so many projects in a year. Therefore, they are having to rationalise which projects are we gonna be doing, even though, yes, all these make sense. We are gonna focus on these five because we believe they got the biggest bang for our buck and you know, I have only so many IT resources, but if you truly apply continuous improvement as a culture, then you should have a regular stream really, of smaller projects that you constantly spin up, close off, see through, realise you jump to the next one. Almost like dynamic teams that you create and you deploy, go fix that problem once it's deployed. A few sprints, we see the results and whether that is with a Kaizen approach or a Six Sigma approach, we have now improved it. Disband that team create a new team that way actually, it is really interesting for the people that work for those companies because they have a more dynamic aspect and a learning aspect to their roles. And quite often it's interdepartmental, so it's actually motivational at the same time. Plus you can start to add all these little 1% improvement points as well. So yeah, we're finding that particularly higher up in the organisation. So if you say C level or one level below, they're looking for the big projects. But really we see that there's a ton of opportunity in a lot of smaller projects. And if they could just strike the balance between the two, that'd be fantastic. Okay. And how do you as a supply chain leader prioritise which of those 20 that you might have on that list down to that five that you're going to actually implement? Ooh, that's an almost impossible question to answer, I'm afraid, because it's so customer specific and their own situation in the marketplace and their competitive pressures that they have. If they have a specific customer contract, for instance, that they are trying to acquire. And for that they need to do a redesign for something, at that moment in time that will get priority because the pull through effect is an extra revenue and profitability layer. So, it is, it is never an just what it realises there at the moment. It's also the consequential effect of the improvements that you make. Another company that we currently work with in the, in the parcel industry, the parcel industry is, notoriously low margin particularly in the UK where there is not a very dominant player. So it's, it's more fragmented. So the margin pressure is enormous. So they're operating model is focused on designing out costs because that actually starts to allow them, potentially to grow some market share. So at that point in time, the investment decisions are all about how can I get the costs out of my business. So it is so situational. I would say, there's not really a standard answer for that question. Fair enough. No, that makes sense. Thinking ahead, what's the next big challenge supply chain leaders should be preparing for? Ah, that is a question that has to sink in for a second. I think the level of striking a balance between the diverse geographic locations where supply chain might be dispersed of versus how much automation you can actually drive versus how you deploy artificial intelligence because, there's so much taking place in the AI space currently, both from a future modeling of strategies, modeling of historic data and doing predictive analysis out of that, but also AI in the moment driving real time and better decisions based on what is happening that are not possible because of the speed, for instance, of what is moving in front of you. It's a very complex balance to strike between a serious amount of unpredictability on terms of what does the future look like?'cause I think gone are the years that we think it's, the next five years are gonna be the same. I think that we look back the last five years, no, no one, not one of the years have been the same. So, that is hard. And then, what can IT, in its widest context and then specifically in automation and in AI, deliver in terms of coping with that unpredictability. And if you could wave a magic wand and fix one thing about the current state of supply chain automation, what would it be? I would love, and, and this is utopia I think, but as I have a magic wand at my disposal I would love startup companies where most of the innovation takes place, I would say in terms of supply chain automation, to come to market with open systems rather than closed systems. And then I, I understand the reason behind it because clearly they are developing IP and they want to protect the IP, therefore, it's a closed system and you have to buy into everything that they do. But the reality is that all customers already have a bunch of technology running their operations, and the new stuff needs to integrate into these technology stacks. So if, if the innovation therefore I, I guess, in the startup space predominantly, but innovation in general takes into account the open nature of having to make this work, not in isolation, but in an integrated system, an ecosystem of systems that would make our lives so much easier. And I think our customers' lives as well. Okay. Okay. And how do you see then collaboration across supply chain partners evolving as companies digitise and automate more? It becomes more and more integrated. Clearly there is a healthy balance to be striking between protecting your own business environment and security, et cetera, versus what you can share. And as long as that is designed robustly, then I think sharing data that is non-strategic to a business, but is strategic to the overall supply chain, the interconnected supply chain would actually allow that ecosystem of that supply chain potentially to be more competitive versus somebody who's not that integrated. So it's a very strategic play for those who could get that right. What metrics or KPIs should companies focus on to measure the success of their initiatives and ensure continuous improvement? Again, it's a little bit project specific, I would say. So in the forklift truck scenario, it's simply a timing. If, if we can see six seconds becoming two seconds or one second, you can multiply that out and then you can decide the consequential effect of that. So it's an ROI model that would be specific to that use case. What we're finding and what we are focusing on generally speaking is we try not too often to solve something that is really unique. But we, we looking for solutions that are generally speaking, cross industry. So as an example, we're working on a solution currently for, in a sortation environment with a label applicator. So as to apply labels. But of course after that there's a, another part of the stream, which is actually our solution, which is about making sure that all the right packages are in the right palette and go out the right door, and then starting to integrate those things. If you start to think about that kind of environment, the KPIs are completely different because it's not necessarily about the technical uptime and how many errors, et cetera we don't have, we prefer to have zero, but you can design in that if something goes wrong, you can, which is actually the Kaizen approach, you can start to do remedial effects straight away, but actually it's the biggest business benefit at that point is actually making sure that the right pallet goes out the right door to the right location 'cause the cost of rectifying that could wipe out the entire profit. A little while back I was working in the automotive supply chain and certain car manufacturers at the time, if they had a car leaving a plant and it went to the wrong market at that moment, the profit of that car would be wiped out. Wow. Yeah. and, and it could be as simple then because we, we designed the solution for it that they had put the wrong manual for the wrong country in the wrong car. So you could have, say, let's say, I'll take an example, a German manual for a car that, that goes to France. At that moment, already, at that moment, they already had a profit issue. So it get, it's interesting that it's not necessarily always the isolation of what happens inside a facility. It's the what happens downstream is just as important to understand, and that could just be the business case in itself. Okay, great. For someone listening today who wants to start making smarter automation choices, what's one practical step they could take tomorrow? So what we generally speaking, advise and, and what we also offer as a, as a service to our customers that we engage with is we, we have a team of consultants that, we use they're free of charge. So basically they're just specialists in their fields and they have a wider view of the automation technologies that are available. What we tend to ask for is just let us walk through your op, operations. From the moment where it comes in to the moment it goes out, it takes us a day. We look at everything and we will come back with a number of ideas that effectively we say, based on our wider industry experience and the technologies that we are aware of, we feel that there's probably opportunities in these five or six things. And then we play that back to a wider audience, typically within the customer. And then anything that they think is of interest the customer always would like a very quick proof of value, we call it, concept. So something that we can spin up no more than two weeks, we can test it. We can see that yes indeed it has changed from moment one to moment two. Therefore we can extrapolate what the business case could potentially look like. And that becomes a very quick validation of whether a new idea is worth investing more time and resources in and spinning up as a proper project. So I think that approach is something that I think would be beneficial to the supply chain world. Okay, great. And what excites you most about the future of supply chain digitisation, automation, and sustainability. Two answers to that question. Okay. first of all I have no idea what is in store for the future in terms of what will still be possible because the speed of innovation only seems to be increasing. And then, and that was Murphy's law. It still seems to apply, which is in unbelievable really. And if I just look at capabilities, sometimes I'm still, I'm still surprised by what is possible and that is in itself a very exciting, it's exciting for us, but it's also exciting for the future. Yeah. Now, coming to the second part of your question, which is sustainability, right? That also hopefully means that we have the technology available to us to create truly sustainable. Environments, not just in supply chain, but all around us. We are gonna have to get to that point at some point because it's, it's still going in the wrong direction. So so hopefully the technology and the, the wider will around us from, from the societies that we're in keeps focusing on what is really important, and that is making sure that we have a sustainable world for the long term, where, you know, we can all thrive as best as we can without depleting all the resources that we're consuming. So, hopefully the continued pace of innovation allows us to get there. Great left field. Question for you, René. If you could have any person or character, or dead real or fictional as a champion for intelligent automation, who would it be and why? I'm gonna mention somebody who actually works for our competitor. So, but he is truly a, he's truly inspirational. So it's, it's a gentleman called Jean-Luc Foster. Okay. I've had the pleasure of working closely with him for about seven years in a previous part of my career. Extremely passionate, extremely driven, and uber creative in thinking beyond what is currently available and then working its way towards getting that. So that'd be the name. Okay. Fantastic. Fantastic. We're coming towards the end of the podcast now, René, is there any question I did not ask that you wish I had or any aspect of this we haven't covered off that you think it's important for people to think about? No, I think it was a very interesting conversation actually. It's, it's nice to talk about not so much the, the detail of a solution, but more the wider view of what is happening around us. Probably we don't do that often enough, so I find it very interesting and entertaining. So thank you very much. Okay, great. Superb. And if people would like to know more about yourself, René, or any of the things we discussed on the podcast today, where would you have me direct them? Well, if it is about me, which it isn't really I'm clearly on LinkedIn, so there's not that many René Schrama's as in the world I've discovered. So it should be easily to, to be found there. But clearly about the, the kind of things that we do as a business, it's peak tech.com. So. Perfect. I'll put those links in the show notes, René, so everyone has access to them. Great. René, that's been fascinating. Thanks a million for coming on the podcast today, Thank you very much Tom. Okay. Thank you all for tuning into this episode of the Sustainable Supply Chain Podcast with me, Tom Raftery. Each week, thousands of supply chain professionals listen to this show. If you or your organization want to connect with this dedicated audience, consider becoming a sponsor. You can opt for exclusive episode branding where you choose the guests or a personalized 30 second ad roll. It's a unique opportunity to reach industry experts and influencers. For more details, hit me up on Twitter or LinkedIn, or drop me an email to tomraftery at outlook. com. Together, let's shape the future of sustainable supply chains. Thanks. Catch you all next time.