In our continuing series of discussions with top supply-chain company executives, Aaron Jones of Bastian Solutions discusses the impact of the coronavirus, support for STEM education, and life as a systems integrator.
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.
Since becoming president of Bastian Solutions in 2014, Aaron Jones has led this growing material handling systems integrator through its successful transition to a subsidiary of Toyota Advanced Logistics. Jones has been with Bastian Solutions since 2010, serving as a regional manager, national director, and vice president before taking on his current role as president. He previously worked as a product design engineer at Ford Motor Co./Visteon Corp. From 1997 to 2000, he played professional baseball within the New York Yankees organization.
Jones has received several patents for Bastian Solutions in robotic applications and automated guided vehicles (AGVs). He also led three strategic acquisitions for the company in the software, consulting, and AGV functional areas. Under his leadership, Bastian Solutions has twice been recognized as one of the Best Places to Work in Indiana by the Indiana Chamber of Commerce. The Indianapolis Business Journal named Bastian Solutions the area’s largest engineering firm in 2020.
Jones holds a master’s degree in engineering management from Wayne State University in Detroit and a bachelor’s degree in mechanical engineering from Southern Illinois University, where he was an All-American baseball player. He recently spoke with DC Velocity Editorial Director David Maloney.
Q: How has the Covid-19 pandemic affected your company and customers so far?
A: The challenges we face as a company and the challenges our customers face are present every day. With that said, we’ve worked incredibly hard to put the necessary safety precautions in place for our employees and for our customers to keep projects on track. The execution and delivery of these projects has changed, but they’re still moving forward. Each is maintaining social distancing and following the necessary precautions with respect to sanitation and PPE. Securing these materials has been challenging, but a top priority for us is keeping our project teams and manufacturing employees safe.
Our next priority has been ensuring the success of current projects and supporting our customers however we can. With the pandemic, of course, there are greater global supply chain challenges, but we have worked hard to limit those—which is a significant benefit of being an independent systems integrator as opposed to relying only on our internal manufacturing. As a global integrator, we can reach out to a wide range of supply networks. If there are delivery or supply chain issues in a certain region or country, we can go to a different region to help mitigate those issues for our clients.
Q: Has the pandemic changed any plans or major initiatives slated for the remainder of the year?
A: The pandemic hasn’t changed any of our overall plans. In fact, we feel that coming out of this pandemic, there is going to be even more demand for the goods and services we provide.
While it hasn’t changed any of our plans, it has inherently delayed them for a few months. We continue to hire and expand through the pandemic, though not as quickly as we had hoped. Once we come through this pandemic, there is going to be greater demand for advanced technologies that provide supply chain visibility and agile operations, areas in which our products and services can truly help; thus, we want to continue to invest in our team and look to the future.
As for our customers, we seem to have two types at the moment: those who have invested in automation (and they sure are happy that they have invested), and those who wish they had automated their facilities before this pandemic. Our goal is to assist those companies in planning for and creating post-Covid operations to address changes in consumer behavior. For example, with most stores in the country closed, the only way to reach clients is digitally—which has made home delivery and curbside pickup imperative.
When you look at the results of the pandemic, as we rebound from the social changes we are left with, we will see a greater sense of social distancing, which goes hand in hand with automated fulfillment systems. There will be lasting changes, so we look forward to supporting our customers through it all.
Q: Bastian Solutions is now part of Toyota Advanced Logistics, which also includes Vanderlande, and is a sister company to Toyota Forklifts and Raymond under the Toyota Industries Corp. (TICO) umbrella. Have you been able to create synergies or joint projects with the other brands?
A: When you look at Toyota’s interest in acquiring Bastian Solutions and Vanderlande, its goal and mission was to provide the greatest level of full turnkey solutions in automation across the globe, which is now largely in effect.
Within TICO, we have a laser focus on global markets of all sizes. There has been very strong correlation across all the TICO companies and our customers to continue to provide our clients with the most comprehensive solutions in the world.
Fork trucks are becoming more and more a part of integrated solutions each year, thanks to their growing sophistication and expanding capabilities. The industry is at a stage where we are getting close to fully automated distribution facilities, and I think going forward, fork vehicles will be so well integrated into the automated systems that they’ll largely be viewed as another piece of equipment, like you’d look at a robot or an AS/RS crane.
Q: Last year, Bastian Solutions opened an advanced manufacturing facility in Indiana. What does that facility provide for you in terms of capabilities and capacities?
A: The primary focus of the facility is to manufacture conveyor, but our commitment to the market and our clients, first and foremost, is that we are an independent integrator. In the last 65 years, we have supplied a large variety of technologies, including a large variety of conveyor—that isn’t going to change with our strong focus on integration. This facility in Indiana provides us with a high-quality conveyor option for our clients; however, we do still leverage other trusted conveyor suppliers that we’ve integrated with for many years. We are consistently reminded that this is the advantage we provide our clients and our first commitment is to our customers. We are going to provide them with the best product available for their system, regardless of where that product comes from.
Q: Bastian Solutions has been recognized as one of the best places to work in Indiana. To what do you attribute that success?
A: We are very proud to have received this award for the second time. Based on an independent employee survey, I can attribute the success to a very keen focus on the satisfaction and feedback of our employees. We listen and look for ways to make their time at Bastian Solutions more enjoyable.
In this day and age, employees have options. Social media is a friend or enemy, depending on how companies treat their employees. Companies must be flexible, progressive, and accommodating. Our human resources team, along with our leadership team, continues to monitor feedback and working conditions, always looking for ways to excel. I look at this award as a report card for how we did this year. We continue to look for innovative ways to serve our employees and will hopefully receive the award for many years to come.
Q: In your career, you worked at Ford Motor Co. and played professional baseball in the Yankees organization. What did those experiences teach you about leadership and team building that you now apply to your role as president of Bastian Solutions?
A: I couldn’t ask for a better experience at either organization. In the mid-90s, the Yankees were leaders in attracting cultural diversification. We had around 60% of the entire organization come from outside the U.S. The cultural differences were significant, and it was a tough adjustment for some players from other countries. I had to learn to function on a diverse team. I think the biggest thing that the Yankees and professional sports taught me was a keen desire to win, but more importantly, it taught me how to lose gracefully. Playing 160 games a year and racking up 100 wins is a good team, but you still lost 60 times. Baseball and athletics at that level taught me how to succeed and fail with grace.
My time with Ford and Visteon taught me how to respect diversification not only on your teams but also by market and country. I also learned about large-scale manufacturing and supply chain. One of my first tours was of an assembly line of a major automotive factory, and it was very eye opening.
Q: You’ve been an advocate for STEM (science, technology, engineering, and math) education. Why is this critical to the future of the industry?
A: The industry is undoubtedly changing at an incredible speed. I have confidence in saying that while the job market has changed significantly over the last 20 years, the change over the next 20 years will happen at an even faster pace.
With regard to STEM and being of an engineering background, I like to encourage schools to not only consider the engineers and scientists that these programs will turn out, but even more so, the technicians. The available secure and stable jobs in the future will require a technical understanding and competence. When I encourage these schools, I emphasize that even with a great track record of producing engineers, we need to also focus on the technicians who might not go through a typical four-year or two-year degree program—we need to give them the technological background to be successful as well.
In many cases, if we put the right programs in place, a senior in high school can graduate with a two-year degree in some sort of technical field and get a really good job. The competencies required to operate automated equipment and understand sensors and PLCs [programmable logic controllers] and software programs do not require someone to write the code or to design the technology, but to understand how everything works, be able to operate it, and be a system expert.
Economic activity in the logistics industry expanded in January, growing at its fastest clip in more than two years, according to the latest Logistics Managers’ Index (LMI) report, released this week.
The LMI jumped nearly five points from December to a reading of 62, reflecting continued steady growth in the U.S. economy along with faster-than-expected inventory growth across the sector as retailers, wholesalers, and manufacturers attempted to manage the uncertainty of tariffs and a changing regulatory environment. The January reading represented the fastest rate of expansion since June 2022, the LMI researchers said.
An LMI reading above 50 indicates growth across warehousing and transportation markets, and a reading below 50 indicates contraction. The LMI has remained in the mid- to high 50s range for most of the past year, indicating moderate, consistent growth in logistics markets.
Inventory levels rose 8.5 points from December, driven by downstream retailers stocking up ahead of the Trump administration’s potential tariffs on imports from Mexico, Canada, and China. Those increases led to higher costs throughout the industry: inventory costs, warehousing prices, and transportation prices all expanded to readings above 70, indicating strong growth. This occurred alongside slowing growth in warehousing and transportation capacity, suggesting that prices are up due to demand rather than other factors, such as inflation, according to the LMI researchers.
The LMI is a monthly survey of logistics managers from across the country. It tracks industry growth overall and across eight areas: inventory levels and costs; warehousing capacity, utilization, and prices; and transportation capacity, utilization, and prices. The report is released monthly by researchers from Arizona State University, Colorado State University, Rochester Institute of Technology, Rutgers University, and the University of Nevada, Reno, in conjunction with the Council of Supply Chain Management Professionals (CSCMP).
As commodities go, furniture presents its share of manufacturing and distribution challenges. For one thing, it's bulky. Second, its main components—wood and cloth—are easily damaged in transit. Third, much of it is manufactured overseas, making for some very long supply chains with all the associated risks. And finally, completed pieces can sit on the showroom floor for weeks or months, tying up inventory dollars and valuable retail space.
In other words, the furniture market is ripe for disruption. And John "Jay" Rogers wants to be the catalyst. In 2022, he cofounded a company that takes a whole new approach to furniture manufacturing—one that leverages the power of 3D printing and robotics. Rogers serves as CEO of that company, Haddy, which essentially aims to transform how furniture—and all elements of the "built environment"—are designed, manufactured, distributed, and, ultimately, recycled.
Rogers graduated from Princeton University and went to work for a medical device startup in China before moving to a hedge fund company, where he became a Chartered Financial Analyst (CFA). After that, he joined the U.S. Marine Corps, serving eight years in the infantry. Following two combat tours, he earned an MBA from the Harvard Business School and became a consultant for McKinsey & Co.
During this time, he founded Local Motors, a next-generation vehicle manufacturer that launched the world's first 3D-printed car, the Strati, in 2014. In 2021, he brought the technology to the furniture industry to launch Haddy. The father of four boys, Rogers is also a director of the RBR Foundation, a philanthropic organization focused on education and health care.
Rogers spoke recently with DC Velocity Group Editorial Director David Maloney on an episode of the "Logistics Matters" podcast.
Q: Could you tell us about Haddy and how this unique company came to be?
A: Absolutely. We have believed in the future of distributed digital manufacturing for a long time. The world has gone from being heavily globalized to one where lengthy supply chains are a liability—thanks to factors like the growing risk of terrorist attacks and the threat of tariffs. At the same time, there are more capabilities to produce things locally. Haddy is an outgrowth of those general trends.
Adoption of the technologies used in 3D printing has been decidedly uneven, although we do hear about applications like tissue bioprinting and food printing as well as the printing of trays for dental aligners. At Haddy, we saw an opportunity to take advantage of large-scale structural printing to approach the furniture and furnishings industry. The technology and software that make this possible are already here.
Q: Furniture is a very mature market. Why did you see this as a market that was ripe for disruption?
A:The furniture market has actually been disrupted many times in the last 200 years. The manufacturing of furniture for U.S. consumption originally took place in England. It then moved to Boston and from there to New Amsterdam, the Midwest, and North Carolina. Eventually, it went to Taiwan, then China, and now Vietnam, Indonesia, and Thailand. And each of those moves brought some type of disruption.
Other disruptions have been based on design. You can look at things like the advent of glue-laminated wood with Herman Miller, MillerKnoll, and the Eames [furniture design and manufacturing] movement. And you can look at changes in the way manufacturing is powered—the move from manual operations to machine-driven operations powered by steam and electricity. So the furniture industry has been continuously disrupted, sometimes by labor markets and sometimes by machines and methods.
What's happening now is that we're seeing changes in the way that labor is applied in furniture manufacturing. Furniture has traditionally been put together by human hands. But today, we have an opportunity to reassign those hands to processes that take place around the edges of furniture production. The hands are now directing robotics through programming and design; they're not actually making the furniture.
And so, we see this mature market as being one that's been continuously disrupted during the last 200 years. And this disruption now has a lot to do with changing the way that labor interacts with the making of furniture.
Q: How do your 3D printers actually create the furniture?
A:All 3D printing is not the same. The 3D printers we use are so-called "hybrid" systems. When we say hybrid, what we mean is that they're not just printers—they are holders, printers, polishers, and cutters, and they also do milling and things like that. We measure things and then print things, which is the additive portion. Then we can do subtractive and polishing work—re-measuring, moving, and printing parts again. And so, these hybrid systems are the actual makers of the furniture.
Q: What types of products are you making?
A: We've started with hardline or case goods, as they're sometimes known, for both residential and commercial use—cabinets, wall bookshelves, freestanding bookshelves, tables, rigid chairs, planters, and the like. Basically, we've been concentrating on products that don't have upholstery.
It's not that upholstery isn't necessary in furniture, as it is used in many pieces. But right now, we have found that digital furniture manufacturing becomes analog again when you have to factor in the sewing process. And so, to move quickly and fully leverage the advantages of digital manufacturing, we're sticking to the hardline groups, except for a couple of pieces that we have debuted that have 3D-printed cushions, which are super cool.
Q: Of course, 3D printers create objects in layers. What types of materials are you running through your 3D printers to create this furniture?
A: We use recycled materials, primarily polymer composites—a bio-compostable polymer or a synthetic polymer. We look for either recycled or bio-compostable [materials], which we then reinforce with fibers and fillers, and that's what makes them composites. To create the bio-compostables, we marry them with bio-fibers, such as hemp or bamboo. For synthetic materials, we marry them with things like glass or carbon fibers.
Q: Does producing goods via 3D printing allow you to customize products easily?
A: Absolutely. The real problem in the furniture and furnishings industries is that when you tool up to make something with a jig, a fixture, or a mold, you tend to be less creative because you now feel you have to make and sell a lot of that item to justify the investment.
One of the great promises of 3D printing is that it doesn't have a mold and doesn't require tooling. It exists in the digital realm before it becomes physical, and so customization is part and parcel of the process.
I would also add that people aren't necessarily looking for one-off furniture. Just because we can customize doesn't mean we're telling customers that once we've delivered a product, we break the digital mold, so to speak. We still feel that people like styles and trends created by designers, but the customization really allows enterprise clients—like businesses, retailers, and architects—to think more freely.
Customization is most useful in allowing people to "iterate" quickly. Our designers can do something digitally first without having to build a tool, which frees them to be more creative. Plus, because our material is fully recyclable, if we print something for the first time and find it doesn't work, we can just recycle it. So there's really no penalty for a failed first printing—in fact, those failures bring their own rewards in the form of lessons we can apply in future digital and physical iterations.
Q: You currently produce your furniture in an automated microfactory in Florida, with plans to set up several more. Could you talk a little about what your microfactory looks like and how you distribute the finished goods?
A: Our microfactory is a 30,000-square-foot box that mainly contains the robots that make our furniture along with shipping docks. But we don't intend for our microfactories to be storage warehouses and trans-shipment facilities like the kind you'd typically see in the furniture industry—all of the trappings of a global supply chain. Instead, a microfactory is meant to be a site where you print the product, put it on a dock, and then ship it out. So a microfactory is essentially an enabler of regional manufacturing and distribution.
Q: Do you manufacture your products on a print-to-order basis as opposed to a print-to-stock model?
A: No. We may someday get to the point where we receive an order digitally, print it, and then send it out on a truck the next day. But right now, we aren't set up to do a mini-delivery to one customer out of a microfactory.
We are an enterprise company that partners with architects, designers, builders, and retailers, who then distribute our furnishings to their customers. We are not trying to go direct-to-consumer at this stage. It's not the way a microfactory is set up to distribute goods.
Q: You've mentioned your company's use of recycled materials. Could you talk a little bit about other ways you're looking to reduce waste and help support a circular economy?
A: Yes. Sustainability and a circular economy are really something that you have to plan for. In our case, our plans call for moving toward a distributed digital manufacturing model, where we establish microfactories in various regions around the world to serve customers within a 10-hour driving radius of the factory. That is a pretty large area, so we could cover the United States with just four or five microfactories.
That also means that we can credibly build our recycling network as part of our microfactory setup. As I mentioned, we use recycled polymer stock in our production, so we're keeping that material out of a landfill. And then we tell our enterprise customers that while the furniture they're buying is extremely durable, when they're ready to run a special and offer customers a credit for turning in their used furniture, we'll buy back the material. Buying back that material actually reduces our costs because it's already been composited and created and recaptured. So our microfactory network is well designed for circularity in concert with our enterprise customers.
Generative AI (GenAI) is being deployed by 72% of supply chain organizations, but most are experiencing just middling results for productivity and ROI, according to a survey by Gartner, Inc.
That’s because productivity gains from the use of GenAI for individual, desk-based workers are not translating to greater team-level productivity. Additionally, the deployment of GenAI tools is increasing anxiety among many employees, providing a dampening effect on their productivity, Gartner found.
To solve those problems, chief supply chain officers (CSCOs) deploying GenAI need to shift from a sole focus on efficiency to a strategy that incorporates full organizational productivity. This strategy must better incorporate frontline workers, assuage growing employee anxieties from the use of GenAI tools, and focus on use-cases that promote creativity and innovation, rather than only on saving time.
"Early GenAI deployments within supply chain reveal a productivity paradox," Sam Berndt, Senior Director in Gartner’s Supply Chain practice, said in the report. "While its use has enhanced individual productivity for desk-based roles, these gains are not cascading through the rest of the function and are actually making the overall working environment worse for many employees. CSCOs need to retool their deployment strategies to address these negative outcomes.”
As part of the research, Gartner surveyed 265 global respondents in August 2024 to assess the impact of GenAI in supply chain organizations. In addition to the survey, Gartner conducted 75 qualitative interviews with supply chain leaders to gain deeper insights into the deployment and impact of GenAI on productivity, ROI, and employee experience, focusing on both desk-based and frontline workers.
Gartner’s data showed an increase in productivity from GenAI for desk-based workers, with GenAI tools saving 4.11 hours of time weekly for these employees. The time saved also correlated to increased output and higher quality work. However, these gains decreased when assessing team-level productivity. The amount of time saved declined to 1.5 hours per team member weekly, and there was no correlation to either improved output or higher quality of work.
Additional negative organizational impacts of GenAI deployments include:
Frontline workers have failed to make similar productivity gains as their desk-based counterparts, despite recording a similar amount of time savings from the use of GenAI tools.
Employees report higher levels of anxiety as they are exposed to a growing number of GenAI tools at work, with the average supply chain employee now utilizing 3.6 GenAI tools on average.
Higher anxiety among employees correlates to lower levels of overall productivity.
“In their pursuit of efficiency and time savings, CSCOs may be inadvertently creating a productivity ‘doom loop,’ whereby they continuously pilot new GenAI tools, increasing employee anxiety, which leads to lower levels of productivity,” said Berndt. “Rather than introducing even more GenAI tools into the work environment, CSCOs need to reexamine their overall strategy.”
According to Gartner, three ways to better boost organizational productivity through GenAI are: find creativity-based GenAI use cases to unlock benefits beyond mere time savings; train employees how to make use of the time they are saving from the use GenAI tools; and shift the focus from measuring automation to measuring innovation.
According to Arvato, it made the move in order to better serve the U.S. e-commerce sector, which has experienced high growth rates in recent years and is expected to grow year-on-year by 5% within the next five years.
The two acquisitions follow Arvato’s purchase three months ago of ATC Computer Transport & Logistics, an Irish firm that specializes in high-security transport and technical services in the data center industry. Following the latest deals, Arvato will have a total U.S. network of 16 warehouses with about seven million square feet of space.
Terms of the deal were not disclosed.
Carbel is a Florida-based 3PL with a strong focus on fashion and retail. It offers custom warehousing, distribution, storage, and transportation services, operating out of six facilities in the U.S., with a footprint of 1.6 million square feet of warehouse space in Florida (2), Pennsylvania (2), California, and New York.
Florida-based United Customs Services offers import and export solutions, specializing in remote location filing across the U.S., customs clearance, and trade compliance. CTPAT-certified since 2007, United Customs Services says it is known for simplifying global trade processes that help streamline operations for clients in international markets.
“With deep expertise in retail and apparel logistics services, Carbel and United Customs Services are the perfect partners to strengthen our ability to provide even more tailored solutions to our clients. Our combined knowledge and our joint commitment to excellence will drive our growth within the US and open new opportunities,” Arvato CEO Frank Schirrmeister said in a release.
And many of them will have a budget to do it, since 51% of supply chain professionals with existing innovation budgets saw an increase earmarked for 2025, suggesting an even greater emphasis on investing in new technologies to meet rising demand, Kenco said in its “2025 Supply Chain Innovation” survey.
One of the biggest targets for innovation spending will artificial intelligence, as supply chain leaders look to use AI to automate time-consuming tasks. The survey showed that 41% are making AI a key part of their innovation strategy, with a third already leveraging it for data visibility, 29% for quality control, and 26% for labor optimization.
Still, lingering concerns around how to effectively and securely implement AI are leading some companies to sidestep the technology altogether. More than a third – 35% – said they’re largely prevented from using AI because of company policy, leaving an opportunity to streamline operations on the table.
“Avoiding AI entirely is no longer an option. Implementing it strategically can give supply chain-focused companies a serious competitive advantage,” Kristi Montgomery, Vice President, Innovation, Research & Development at Kenco, said in a release. “Now’s the time for organizations to explore and experiment with the tech, especially for automating data-heavy operations such as demand planning, shipping, and receiving to optimize your operations and unlock true efficiency.”
Among the survey’s other top findings:
there was essentially three-way tie for which physical automation tools professionals are looking to adopt in the coming year: robotics (43%), sensors and automatic identification (40%), and 3D printing (40%).
professionals tend to select a proven developer for providing supply chain innovation, but many also pick start-ups. Forty-five percent said they work with a mix of new and established developers, compared to 39% who work with established technologies only.
there’s room to grow in partnering with 3PLs for innovation: only 13% said their 3PL identified a need for innovation, and just 8% partnered with a 3PL to bring a technology to life.