Podcaster Timothy Dooner is an icon, and his show, What the Truck?!?, is one of our favorites to listen to. So it’s no wonder that our founder and CEO, Derek Szopa, jumped at the chance to be interviewed by him. Derek’s only regret? Not being able to get a hold of the amazing “Dark Helmet” hats for himself.
It’s worth your time to listen to their whole conversation. Find it on your favorite podcast app, or here on the podcast website. In the meantime, here’s an excerpt:
Timothy Dooner [TD]: So, you're the founder — how did you get the idea? Do you remember the day you were sitting around and you're like, “Man, there's gotta be a better way?”
Derek Szopa [DS]: There are such changes in the world. Computing power has evolved so much in the decades since these big hub and spokes systems were designed. Think about really small, modular, lightweight operations, micro fulfillment, the impact that all is having on the supply chain. Think about Starlink and the effect that that kind of distributed thinking has had on how communication works. Is there a way we can use all these advancements in technology and apply them to the middle mile space? We believe the answer is yes.
TD: Talk a little bit about the inefficiency in the middle mile, because I worked freight too and I'm of the opinion that that is where most of the inefficiency mistakes can happen.
DS: If we can be smarter about how we're transporting goods across these long distances, it certainly can lower costs. And if we do it in a smart way, and there's trust, and the incentives are aligned, then it can be extremely powerful. We think a lot about incentives. If we can get the incentives right, we can keep these trucks fuller. And not only trucks, but also operations and warehousing. We need a better-designed system.
TD: What are ship shipper expectations now out of the middle mile?
DS: Someone says “sortation” and the mind goes to, “Oh, I need millions of dollars of automated sortation equipment. Really heavy industry.” We take the opposite view. It can be very simple, lightweight, elegant, and quick to deploy. So we can enable shippers to participate in a way that works for them.
TD: Well, how does that differ from the carrier expectations? Because that's always traditionally been one of the problems with stakeholders in the supply chain. They're both pulling in different directions — because they have different goals.
DS: Part of the tension here has to do with how capital intensive the middle mile can be. So that creates this adversarial relationship between the carrier that’s providing the capacity and the shipper that needs the capacity. But what if you could eliminate a lot of that heavy infrastructure cost? You can engage that shipper to participate at a higher level, design the contracts in a way that's healthy, where the incentives are aligned. We're starting to experiment with that, with really a high level of success.
TD: You’ve put some heat on the hub and spoke system. I was curious: Is that outdated? And what's a better way?
DS: That system [hub and spoke] was designed in the fifties. It's very simple, easy to execute…. But what it doesn't fully capture is all these advancements in technology. The power of cloud computing, the power of AI, the power of really distributed networks and being able to route things very directly. With Cloudsort, we want to simplify things, not make them more complex.
And it can be very simple. We don't need an overly complex system at that point of origin. It can be simple tools. A few scanners is really all you would need. That’s what I'm talking about: Routing directly, having a system that thinks globally. You're always gonna need to aggregate at some point, but you can do that work at the point of greatest value creation. And that's what we want to enable.
With Cloudsort, we want to simplify things, not make them more complex. —Derek Szopa, CEO, CloudSort
TD: Where do you think AI will have the most impact in the supply chain?
DS: Goods are moving over such long distances in some cases. You think about like a mesh network and goods like routing through this network. The AI is able to run all these very complex calculations and understand the best decision we can make every time we touch a package. There's a tremendous amount of opportunity there.
Listen to their whole conversation here, on the What the Truck?!? Podcast website.