In our continuing series of discussions with top supply chain company executives, Brett Wood of Toyota discusses the steady growth in the use of forklifts, and changes and acquisitions by his company.
David Maloney has been a journalist for more than 35 years and is currently the group editorial director for DC Velocity and Supply Chain Quarterly magazines. In this role, he is responsible for the editorial content of both brands of Agile Business Media. Dave joined DC Velocity in April of 2004. Prior to that, he was a senior editor for Modern Materials Handling magazine. Dave also has extensive experience as a broadcast journalist. Before writing for supply chain publications, he was a journalist, television producer and director in Pittsburgh. Dave combines a background of reporting on logistics with his video production experience to bring new opportunities to DC Velocity readers, including web videos highlighting top distribution and logistics facilities, webcasts and other cross-media projects. He continues to live and work in the Pittsburgh area.
Brett Wood is president and CEO of Toyota Material Handling North America (TMHNA), which is composed of three main companies: Toyota Material Handling U.S.A. Inc. (TMHU), Toyota Industrial Equipment Mfg. Inc., and The Raymond Corp. Wood also serves on the board of these three companies. He has worked in the material handling industry since 1989, previously serving in positions at Toyota that included TMHU president; vice president of marketing, product, strategic planning, and training operations; and dealer development. Prior to joining Toyota, Wood held engineering positions with IBM Corp. and Northrop Aerospace, where he earned the recognition of "Engineer of the Year." He has a bachelor's degree in mechanical engineering from Cornell University. He recently spoke with DC Velocity Editorial Director David Maloney.
Q: How do you view the current state of the material handling industry?
A: Simply stated, it's a great time to be in the material handling industry. During the last few years, manufacturers have enjoyed record volumes. Dealers have experienced record sales. New suppliers and partnerships are being forged continuously. Exciting technology is being introduced into our industry every day. Material handling products and services are now extremely innovative and becoming more sophisticated. As a result, our customers are more productive than ever before.
I've worked in this industry for 30 years now, and it is changing faster than ever. I predict that in the next five years, the rate of innovation will be more than the changes we've seen in the last 10 years. As a former engineer, I can't wait to see how efficient North America's material handling industry will be by the year 2025. But even with significant advancements in our products, our industry will still be driven by the ever-changing demands of customers. Companies like Toyota and Raymond are having success by evolving quickly with changing customer expectations and a focus on keeping the customer at the center of their strategies.
Q: The Industrial Truck Association recently announced that forklift truck sales in North America recorded their fourth consecutive year of solid growth. To what do you attribute the ongoing strength of the forklift market?
A: The U.S. economy is currently fairly strong, and forklift sales are a reflection of a strong economy. Our industry is mixed, with an entirely different set of customer expectations and buying habits, resulting in diverse applications. For example, e-commerce and the expectation of next-day delivery for virtually everything has changed the way material is handled. This trend has increased the speed at which we need to pick, palletize, and move materials. Meanwhile, macroeconomic trends have brought some manufacturing back into North America from places like Asia and Europe. Bottom line, business is booming across many industries, and everyone is seeing a growing demand to handle material efficiently, and forklifts play an important role in that process. Remember that everything we own, touch, eat, or drink was probably moved by a forklift at some point in the supply chain process.
Q: You have an engineering background. It's rather unusual for an engineer to rise to be president and CEO of a large corporation. How do the skills you developed as an engineer benefit you as a leader?
A: In some companies, an engineering path is not a normal rise to the highest levels of leadership. But at Toyota, a process-driven and customer-focused company, an engineering mindset is very beneficial. Engineers are curious and creative problem-solvers. They see the big picture as well as the details. Engineers are tenacious and not inclined to pass the buck. Engineers value input from customers. These traits have all benefited me in my career, whether I was focused on engineering a product or managing the company's growth or setting our future strategic direction.
Also, Toyota is a very product-driven company, and I tell new hires to learn about our product lineup as quickly as possible. I find it very beneficial to be able to talk confidently about our products whether I'm at a press conference, in a hallway conversation, in a boardroom, in a staff meeting, or with a customer. Additionally, I've worked for some great leaders, both in the U.S. and from Japan, who have helped me develop my own leadership skills—which they don't teach you in engineering classes. And more than anything, I work for a company that values leadership, culture, and people, no matter what educational background they possess.
Q: Both Toyota and Raymond are very involved in National Forklift Safety Day. Why is this important to your organizations and the industry?
A: There is nothing more important to our companies than safety. We discuss it every day in our meetings, and it's at the core of what drives our team at all levels. So it's no surprise that Toyota was instrumental in creating and supporting National Forklift Safety Day, which will be held for the 6th consecutive year on June 11, 2019. It's a great opportunity to align the industry around something we all care about passionately and that is vitally important to all of our customers. Raising awareness of the importance of appropriate training is one of the main themes of National Forklift Safety Day. For example, effective forklift operator safety training may reduce accident rates by 25 percent, according to OSHA. Creating safe working environments is important to everyone in our industry.
Q: In January, Toyota announced a reorganization of its business units to form a single company to be known as Toyota Material Handling. How does this better position you in the marketplace?
A: The company is in the process of reorganizing throughout this year and will officially become Toyota Material Handling Inc. on Jan. 1, 2020. By bringing the manufacturing and engineering group (Toyota Industrial Equipment Manufacturing) together with the sales, marketing, and distribution group (Toyota Material Handling USA), we are simply better able to serve the needs of our dealers and customers. We will be able to streamline work processes throughout our organization. For example, our manufacturing and engineering teams will become even closer to our customers' unique needs. We're also able to align goals and priorities under one leadership team. And we're able to eliminate wasted time and energy in certain areas to move faster. It's a more efficient organization that will thrive even more together as one company, bringing one strong voice to our customers and our community.
Q: Toyota has been busy the past couple of years adding material handling companies outside of its core forklift business, like Vanderlande and Bastian Solutions. What are some of the reasons behind this strategy?
A: Customers require a wider variety of material handling solutions than they have in the past. Changing dynamics in the North American material handling market have created demand for new forms of logistics solutions beyond forklifts. We intend to build a stronger presence in the area of advanced logistics technology and to share that expertise with both our Toyota and Raymond brand forklift dealers. For the Toyota Advanced Logistics companies, there is a real need to find technicians to handle maintenance on conveyors, robotics, and other automation-related equipment. Toyota and Raymond employ thousands of technicians through our dealer networks, so that's also complementary for our businesses.
Finally, we're all developing new products, and many of them will be automated in the future. There is a benefit for all of us to accelerate and work together to develop some of these products. We are confident these acquisitions will result in greater customer support by working together than we could have accomplished individually.
Supply chain planning (SCP) leaders working on transformation efforts are focused on two major high-impact technology trends, including composite AI and supply chain data governance, according to a study from Gartner, Inc.
"SCP leaders are in the process of developing transformation roadmaps that will prioritize delivering on advanced decision intelligence and automated decision making," Eva Dawkins, Director Analyst in Gartner’s Supply Chain practice, said in a release. "Composite AI, which is the combined application of different AI techniques to improve learning efficiency, will drive the optimization and automation of many planning activities at scale, while supply chain data governance is the foundational key for digital transformation.”
Their pursuit of those roadmaps is often complicated by frequent disruptions and the rapid pace of technological innovation. But Gartner says those leaders can accelerate the realized value of technology investments by facilitating a shift from IT-led to business-led digital leadership, with SCP leaders taking ownership of multidisciplinary teams to advance business operations, channels and products.
“A sound data governance strategy supports advanced technologies, such as composite AI, while also facilitating collaboration throughout the supply chain technology ecosystem,” said Dawkins. “Without attention to data governance, SCP leaders will likely struggle to achieve their expected ROI on key technology investments.”
The British logistics robot vendor Dexory this week said it has raised $80 million in venture funding to support an expansion of its artificial intelligence (AI) powered features, grow its global team, and accelerate the deployment of its autonomous robots.
A “significant focus” continues to be on expanding across the U.S. market, where Dexory is live with customers in seven states and last month opened a U.S. headquarters in Nashville. The Series B will also enhance development and production facilities at its UK headquarters, the firm said.
The “series B” funding round was led by DTCP, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing investors Atomico, Lakestar, Capnamic, and several angels from the logistics industry. With the close of the round, Dexory has now raised $120 million over the past three years.
Dexory says its product, DexoryView, provides real-time visibility across warehouses of any size through its autonomous mobile robots and AI. The rolling bots use sensor and image data and continuous data collection to perform rapid warehouse scans and create digital twins of warehouse spaces, allowing for optimized performance and future scenario simulations.
Originally announced in September, the move will allow Deutsche Bahn to “fully focus on restructuring the rail infrastructure in Germany and providing climate-friendly passenger and freight transport operations in Germany and Europe,” Werner Gatzer, Chairman of the DB Supervisory Board, said in a release.
For its purchase price, DSV gains an organization with around 72,700 employees at over 1,850 locations. The new owner says it plans to investment around one billion euros in coming years to promote additional growth in German operations. Together, DSV and Schenker will have a combined workforce of approximately 147,000 employees in more than 90 countries, earning pro forma revenue of approximately $43.3 billion (based on 2023 numbers), DSV said.
After removing that unit, Deutsche Bahn retains its core business called the “Systemverbund Bahn,” which includes passenger transport activities in Germany, rail freight activities, operational service units, and railroad infrastructure companies. The DB Group, headquartered in Berlin, employs around 340,000 people.
“We have set clear goals to structurally modernize Deutsche Bahn in the areas of infrastructure, operations and profitability and focus on the core business. The proceeds from the sale will significantly reduce DB’s debt and thus make an important contribution to the financial stability of the DB Group. At the same time, DB Schenker will gain a strong strategic owner in DSV,” Deutsche Bahn CEO Richard Lutz said in a release.
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.
Serious inland flooding and widespread power outages are likely to sweep across Florida and other Southeast states in coming days with the arrival of Hurricane Helene, which is now predicted to make landfall Thursday evening along Florida’s northwest coast as a major hurricane, according to the National Oceanic and Atmospheric Administration (NOAA).
While the most catastrophic landfall impact is expected in the sparsely-population Big Bend area of Florida, it’s not only sea-front cities that are at risk. Since Helene is an “unusually large storm,” its flooding, rainfall, and high winds won’t be limited only to the Gulf Coast, but are expected to travel hundreds of miles inland, the weather service said. Heavy rainfall is expected to begin in the region even before the storm comes ashore, and the wet conditions will continue to move northward into the southern Appalachians region through Friday, dumping storm total rainfall amounts of up to 18 inches. Specifically, the major flood risk includes the urban areas around Tallahassee, metro Atlanta, and western North Carolina.
In addition to its human toll, the storm could exert serious business impacts, according to the supply chain mapping and monitoring firm Resilinc. Those will be largely triggered by significant flooding, which could halt oil operations, force mandatory evacuations, restrict ports, and disrupt air traffic.
While the storm’s track is currently forecast to miss the critical ports of Miami and New Orleans, it could still hurt operations throughout the Southeast agricultural belt, which produces products like soybeans, cotton, peanuts, corn, and tobacco, according to Everstream Analytics.
That widespread footprint could also hinder supply chain and logistics flows along stretches of interstate highways I-10 and I-75 and on regional rail lines operated by Norfolk Southern and CSX. And Hurricane Helene could also likely impact business operations by unleashing power outages, deep flooding, and wind damage in northern Florida portions of Georgia, Everstream Analytics said.
Before the storm had even touched Florida soil, recovery efforts were already being launched by humanitarian aid group the American Logistics Aid Network (ALAN). In a statement on Wednesday, the group said it is urging residents in the storm's path across the Southeast to heed evacuation notices and safety advisories, and reminding members of the logistics community that their post-storm help could be needed soon. The group will continue to update its Disaster Micro-Site with Hurricane Helene resources and with requests for donated logistics assistance, most of which will start arriving within 24 to 72 hours after the storm’s initial landfall, ALAN said.