Industrial Insights Podcast
Industrial Insights with Rob Jensen
Episode summary
I have Rob Jensen of my plan and Rob has gone through the PhD program at the school at the University of Arkansas where I'm going through the master's program right now.
Full transcript
Justin Smith 00:01
Welcome everybody to another episode of the industrial insights podcast. I have Rob Jensen of my plan and Rob has gone through the PhD program at the school at the University of Arkansas where I'm going through the master's program right now. So we are two fellow supply chain nerds that are making our way in the world and I saw Rob's product from his new company that is a warehouse picklist optimizer. and I'm just at the end of learning about supply chain optimization. And so I was like, man, this is taking optimization to the inside of the box. That'd be great to learn more. So I asked Rob to join me and excited for everybody to learn and to learn more about you, Rob. So I appreciate you being here. Maybe you can give us a little background.
Rob Jensen 00:53
Yeah. Appreciate the opportunity, Justin. So like you said, my name is Rob Jensen. I graduated from the University of Arkansas PhD program last year. So I have a PhD in supply chain management and decided to launch my plan as a continuation of some research I did as a grad student. So before that, I'm from Nebraska. So was born and raised there. Got my undergrad in econ, a master's in econ data science. I also have experience in operations. So I worked with Walmart out of undergrad. So really what my plan is, is a combination of my operations experience and data science. So what we're doing is we're doing warehouse optimization inside the four walls, like you said. know, labor is a big, labor costs are big issue right now. And our goal is to reduce overhead for our clients.
Justin Smith 01:51
Nice. And we got a Norwegian mixed up in all this somehow?
Rob Jensen 01:56
Yeah, so my partner Kim Ejens, he's out of Norway. He's a very technical individual. So he put together the software. We worked for the last year and half putting it together. We launched about two months ago. Feedback has been wonderful. And we're able to work together remotely, fortunately. I think everyone got used to that with COVID. And it's been a great experience working with Kim the last two years.
Justin Smith 02:19
yeah. We went out there on a family trip one time and we spent like two weeks out there and had such a great time and it was like the culture couldn't have connected better of like all being on the same page and similar styles and like it was such a great experience that like it's got a special place in my heart now. So yeah, what a beautiful place to visit. So it's exciting to have you have a connection over there.
Rob Jensen 02:47
Yeah, I'm looking forward to a trip to Norway. I haven't been yet. We've been remote this entire time. So we're actually getting together in Vietnam here in a couple of months for a couple on sites. So looking forward to getting connected. Yeah, we've done all of this remotely so far.
Justin Smith 03:04
that's far out. Yeah. And then what was your PhD project? Like a PhDs you have to come up with a project that like furthers the knowledge base or like that's something I'm less familiar with. Maybe it could help help me understand. Or was it it was some version of this like an earlier version maybe?
Rob Jensen 03:22
Yeah, absolutely. Yeah, so I did an early version for a company. I was using heuristics. So how do you create a better pick path than currently exists in warehouse management systems? And we use heuristics and it worked out pretty well. We were able to see some quality results in picker productivity improvement. And so I started working with Kim to figure out, is there a way to not use heuristics and to be able to scale the solution that I created as a grad student? So we took the same concept and created a platform. So we have to make a digital twin of the warehouse so you can see inside of it. And then we're able to use some simulation and optimization to provide the best route for pickers.
Justin Smith 04:17
How is heuristics limiting? Like what's inherently limiting about that?
Rob Jensen 04:23
Yeah, so heuristics, if you think about kind FedEx, UPS, always make right turns, never go in reverse, you know, they're great rules of thumb, but they don't necessarily provide the best solution. And every warehouse is designed a little differently, so it's tougher to do the implementation. It's tougher to scale that implementation. So our goal was to come up with a solution that is easy to implement and that is scalable.
Justin Smith 04:30
you Yeah, so when I think of picking now, so for anyone that's like not too deep into the operations world, picking is when you have products that are on the shelves, possibly in racking in a warehouse for a company that has a Oftentimes like a consumer product and has sells individual items oftentimes So if you think like toothpaste you may have a million tubes of toothpaste in your warehouse But you need to get one tube of toothpaste into a box and needs to go to the customer that bought it and so managing orders and getting This part of the process optimizes like that's the challenge and that's what Rob's like a helping improve How do people do it now? What's today's state of the nation for that?
Rob Jensen 05:45
Yeah, so industry standard is a predefined pick path where it's set up in the system and you start with location one, then go to location two, three, four, et cetera. And we're saying, you you don't have to follow a predetermined path. You should actually skip that and, you know, look at the distances and, and, you know, follow the optimized path versus the predefined path.
Justin Smith 06:11
And right now the predefined path is defined from like a warehouse management system or is just kind of like a human derived.
Rob Jensen 06:22
So both exist. Primarily it's set up within the warehouse management system. So when you go to do an implementation, part of that implementation process is defining that pick path. So it is, yeah, it's defined by the managers who set it up, who know their facility, whether it be a warehouse or like a grocery store.
Justin Smith 06:34
Okay, cool. Yeah, and so I would imagine what was missing is like this is just a huge additional effort, right? That like people you can't do manually, like that just doesn't like make sense. There's too many picks and too many days and too much variation that like no one, if it was your sole job to figure out, like you still wouldn't be able to do it, much less scale it. Yeah, I could totally see why that's a challenge.
Rob Jensen 07:11
Yeah, absolutely. It doesn't matter how well you know your warehouse, unfortunately, or fortunately, the computers are smarter than us, at least in telling us some of the optimization, some of the ways that we can do it. Yeah. Yeah.
Justin Smith 07:25
For this stuff? Yeah. What's Amazon doing? They gotta be doing something.
Rob Jensen 07:32
You know, I am not familiar with Amazon's operations. I know they like to keep everything kind of close to the chest.
Justin Smith 07:37
We gotta get in there Rob with those binoculars and yeah, camera.
Rob Jensen 07:42
Yeah, no, know that they do a lot of part to picker, so they have the pieces come to people doing the packing. And we're primarily focused with the opposite, so picker to part.
Justin Smith 07:52
Yes. Yes. So the opposite, just to clear it up for some people, bringing the item to the person. And so if you think of like those Kiva systems, right, they would pick up the tote that would have the item and so you wouldn't go to the toothpaste, the toothpaste comes to you, which I could totally see has its own reason why it's helpful, but then comes with its own set of downsides of like, then they are all your moving product. Maybe you're moving product that doesn't get picked and maybe there's like inefficiencies there or maybe that's not always the optimized route. And then recently I'd seen a robotics company that's starting to get in on robotics with a certain like they're trying to get the mechanism that can make the each pick robotically. And that was something that I'd like heard people talking about but hadn't really seen any like demos of. that was also an interesting evolution in how do we do better with this particular challenge.
Rob Jensen 08:59
Yeah, and with robotics, mean, there's a lot of expense for implementing any of those systems. So for a lot of companies, you have to weigh the expenses versus the expected outcome. And a lot of companies are more focused on continuing their operations. They don't want to take those big risks and potentially have them fail because it is a low margin operation. And it's generally considered a cost center. If you think about just how people have evolved over time, mean, so much of the dexterity in your fingers, it's innate for people to be able to pick up boxes, but it's much harder to teach a robot to do that same thing.
Justin Smith 09:47
I believe it, even though they have thumbs.
Rob Jensen 09:50
Yeah, yeah, even though they have thumbs. Absolutely.
Justin Smith 09:54
Well, I feel like you got your value proposition dialed right there, Rob. That is such a great way to think about it. You can get the benefits without these crazy CapEx budget and all the risk that goes with trying to trial robots as a service and implement this whole new way of doing it. small way in like trying to figure out how a trial would work and then how do you then scale that. And then you got to scale your cap spend and like I could see that be just a lot bigger ask.
Rob Jensen 10:30
Yeah, absolutely. And what we're able to do is actually look at historic data and understand what we should be able to provide for savings for our clients before they do implementation. So we're able to say, we can reduce the travel distance your pickers take by 20%. We know that about half of the time that pickers spend on the floor is spent traveling. So we're able to reduce overhead by about 10%.
Justin Smith 10:59
So that's a great way to segue a little bit into you are a VP of operations or of supply chain. This is a pain point for you. There's potential worth exploring. And you got Rob on the other. end of the phone. So what do you need? Like, it all comes back to like, give me the data and you got to like, what data do you need? Or kind of what's it generally like, how do you start to flesh this out a little bit for people?
Rob Jensen 11:33
Yeah, so what we need is access to a facility so we can go and create a digital twin for that facility and then transactional picking data. So once you scan a box to select it, there should be a log of that data and we can run through those logs and come up with what the operations are currently doing and compare that to our solution.
Justin Smith 11:59
Are you making like a CAD drawing or you take a drawing from their material handling people that make their own CAD when they're laying the racking out or how's that part? How do you digitize the warehouse layout?
Rob Jensen 12:09
Yeah, we actually go. Yeah, so we have, we created some custom software to be able to do that. We go into the facility, collect some dimensions, collect location IDs, plug that into our software, and then we're able to come up with a 3D digital twin of the facility that we use to map out the pick pass, the picker stake.
Justin Smith 12:37
Nice. I always think of like we're using Matterport now for like, you know, taking 3D photographs of the inside of buildings and then it will give you the dimensions within a certain like a margin of error. but that's totally not like to scale like you'd think like CAD is like as good as you can get most of the time. So you're saying you need pick data and trend. and you make your digital twin. And that's kind of... That's it?
Rob Jensen 13:09
Yeah. And then we provide an API for clients to be able to send us the orders that they are currently working on or will be working on. We send back the optimized pick path for pickers and they follow our route going forward. So that's, that is the solution in a nutshell.
Justin Smith 13:29
Yeah, how cool is that? And this can be for any size, like you've seen 50,000 and 500,000.
Rob Jensen 13:37
Yeah, up to a couple million, absolutely.
Justin Smith 13:40
Yeah, that's wild. That's so awesome how fast you can get to like here, here, try this and see how it works for you. Yeah.
Rob Jensen 13:52
Yeah, we're absolutely able to provide that pre-assessment to make sure that the solution's going to work for the client, especially if they feel like there's one-offs in their systems. Hey, maybe it might not work. Come try it. Let's see if it works. Let's make sure that there's going to be that value. for clients and from there, all we have to do is integrate our solution, make sure everything is up and running with the APIs and they'll get optimized pick lists going forward.
Justin Smith 14:24
Yeah, Who would you say it works best for and who are people that like our edge cases where like it's not really ideal for what's like at the sweet spot and why?
Rob Jensen 14:35
Yeah, so the sweet spot for us is like third party logistics companies or warehouses that are fulfilling stores. So the sweet spot is when you are going to multiple locations within a facility building out pallets. If you have, let's say, 2500 locations in your facility and on average, you're only going to 20 of them. That's great. We've shown that. that we can provide a lot of value there. If you're doing full pallet moves where you're only doing one full pallet, primarily with forklifts, you might not see that return because you're only going one place and back. our sweet spot is really where you're hitting multiple locations within that facility and you've got a large skew assortment.
Justin Smith 15:27
I would think a lot of this would end up to then optimizing where you are laying out your product in the first place, right? After you go through this and then you're like, hmm, we can learn more from this. And maybe if we start moving higher volume items, or I imagine it leads to further optimization opportunities. Have you seen much of that? Or like, like,
Rob Jensen 15:53
Yeah, so that is on our roadmap actually. That's something that we, yeah, yeah, that's something that we wanna build out in the future. Once we get into a couple more live facilities and have more data that we're working with. So yeah, you should be able to do optimal placement. Are we getting the high volume items towards the start or end point?
Justin Smith 15:57
my bad. OK, this is it's going. Yeah.
Rob Jensen 16:19
Yeah, yeah, that's something we're planning on working on in the future. We've got it sketched out right now.
Justin Smith 16:24
Nice. And what are challenges with APIs and working with ERP systems, warehouse management systems, or transportation systems? I'm sure there's a whole bunch of detail there to make them all play nice together and to have this pick ordering integrate smoothly or seamlessly.
Rob Jensen 16:46
You know, I'm sure there are, but fortunately that's why my partner, I've got my partner, Kim. Yeah, he's much more on the technical side of things than I am. So I don't really have an answer for that one. We'll have to chat with him in the future.
Justin Smith 16:51
Hahaha! Yes. You do have an answer. Yeah. Fantastic. That's great. Exciting. Well, yeah, I feel like that's the big stuff like to learn what's the cost of all this? What's a ballpark? How do people think about that?
Rob Jensen 17:18
Yeah, so our value proposition is based off of savings. So let's say we're able to save a client $50,000 per month. We want to come in at about 20 % of that. So we charge based off of transaction. So it's usage based. And we want to come in about 20%. So if we're saving a client $50,000 a month, our cost would be about $10,000.
Justin Smith 17:42
I love the savings part, right? Because then it's like based on the value that was added and everybody wins and like interests are aligned for sure.
Rob Jensen 17:54
Yes, yeah, absolutely.
Justin Smith 17:56
Like for companies, our job is to find the right property for them and help them gain control of it and help them go through the contracts and kind of anything and everything that have to do with the warehouse. But how we get paid is based on the value of the building that's... sign. So if they sign a bigger building you get paid more. If they pay more rent you get paid more. And so it's not like you like if you follow the money it's not like you want your client to pay more. You want them to get the best possible deal because that creates a happy client and an alignment of interests. But this is where it's like there's no there's no conflict there. Yeah or like a potential for conflict.
Rob Jensen 18:39
Yeah, and that's where our solution works well for large facilities. We obviously get paid based off of what we can save the clients. So for us, it's a better opportunity to be in the larger facilities. we're not saying that we're going to limit our clients based off of their footprint. We'd like to provide this solution to everyone.
Justin Smith 19:04
And is your big problem these days getting in front of clients? Or what's making this thing blow up?
Rob Jensen 19:10
Yeah. Yeah, right now it's, you know, we're soft launching. It is just Kim and I for the moment. So we are, we're bootstrapping the company. So we're definitely trying to stay within our means and not to not get too far over our skis in terms of taking on commitments until we can hire the appropriate staff to do the rollouts faster. So.
Justin Smith 19:35
You're an entrepreneur. Now you're going to have payroll and managing people and all that stuff. Yeah. That's the dream. I love it. That's great.
Rob Jensen 19:41
Yeah, yeah, that's the next step for us.
Justin Smith 19:47
I know we are a little shorter on time, but I would hope we'd have time to talk about how the University of Arkansas helped you and what your experience was going through the program and how it helped connect to what you're doing today. Can you touch on that some? What your experience was like?
Rob Jensen 20:04
Yep. Yeah, absolutely. University.
Justin Smith 20:06
I don't work for them, right? But I figure it's extended an opportunity and put you in the right ecosystem and connected you with a lot of the right resources that have to have been, it seems like it would be super helpful for you and for others. I know it has been for me.
Rob Jensen 20:21
Yeah, I mean, The University of Arkansas, can't say enough positive things about the program. You know, the PhD program is arguably the best in the, in the world. So having the opportunity to attend, you know, was a fantastic opportunity for me. You know, what, what better place to learn about supply chain than the university attached to or named after the founder of Walmart. You know, you can't be in a better ecosystem to learn about supply chain and then the projects that you, you're you have access to as a student, we're top notch. Great to prepare me to take something like this on.
Justin Smith 20:58
Did you have a favorite class that stands out? Or favorite experience?
Rob Jensen 21:02
You know, being able to work on in the field actually and be able to do some of this in practice versus in the classroom was, I think, one of the best opportunities that I had. You know, as a PhD student, I think you get that opportunity a little more than as a master's student. So the first two years of the PhD program were focused on classwork and then the last two are focused on your dissertation. And one of my dissertation projects got the opportunity to go into the field for a large third-party logistics client, and really get some hands-on experience with software development and understanding the needs at scale.
Justin Smith 21:45
Yeah, three PLs are blowing up, right? If we look at like who is filling all these buildings, I forget if it was somewhere around 50 % of all the leases that were signed on over 100,000 feet in the Greater Southern California area, or all third party logistics, which makes sense then like people outsourcing and as they scale or to cover like the rest of the market or to be exposed to logistics companies that have focused purely on all this optimization and on the transportation part and like that's their jam and what they do well. So I feel like that is a growing part of the industry and a great place and pretty cool. Like you should have a lot of opportunity to meet a lot of like there's a lot of significant companies doing business and like it's a big pool to be swimming in.
Rob Jensen 22:35
Yeah, it's an ever-growing market, especially as e-commerce takes off. You get the issues of, do we want to manage our inventory or do we want to pay someone to manage it for us who has that dedicated experience? So that's where I feel like a lot of folks that are selling products are opting to not be experts at everything and work with third-party logistics companies.
Justin Smith 23:03
Yeah, we don't want to do it in-house until we don't want to do a third party again. Yeah, it's funny to see people bounce back and forth. Cool, fantastic. That's awesome. I think that's a great primer and then people can reach out to you. You can demo this for people I would imagine. That's a great way for people to learn more if they work for a 3PL or if they're connected to them or other people they think that might benefit.
Rob Jensen 23:11
Yes. Yeah, if you're interested in scheduling a demo, can send me an email, rob@myplan.com, message me on LinkedIn. We're happy to schedule demos, show you the product, and then schedule an evaluation on site.
Justin Smith 23:47
Cool. Have airplane ticket, we'll travel. Yes. Thank you, Rob. I appreciate you spending time with me today. I'll put all your contact information in the show notes and then look forward to catching up with you later.
Rob Jensen 23:51
Exactly. All right, I appreciate it, Justin. Thank you so much. That's it.
Justin Smith 24:04
Cool, see you Bye bye.