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Understanding Complex Supply Chains with Chris Jamroz
109 Plays1 year ago
In this episode, Chris Jamroz, Executive Chairman of the Board and CEO at Roadrunner, joins Host Brian Glick, CEO of Chain.io, to discuss:
- Improving logistics services through direct connectivity
- Process optimization and technology to improve efficiency and customer experience
- Challenges of relying on outdated technology
Chris Jamroz is the Executive Chairman of the Board and CEO at Roadrunner. Chris is a highly experienced executive focused on creating shareholder value through active executive management of portfolio companies in transportation, logistics and cyber security. Before coming to Roadrunner, Chris served in executive roles at Emergent Cold, STG Logistics, and Garda Cash Logistics.Tune into a related episode, Embracing a Digital Supply Chain with Mauro Rodrigo Gonzalez, CSO + President of Ascent On-Demand at Ascent Global Logistics.
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Transcript
00:00:04
Speaker
Welcome
Introduction to Chris Jamarance and Roadrunner
00:00:05
Speaker
to Supply Chain Connections. I'm Brian Glick, founder and CEO at Chain.io. On this episode, we're going to do something very interesting. We're going to talk about how to resurrect the fallen giant. Our guest today is Chris Jamarance, who is the executive chairman and CEO at Roadrunner and Ascent Global Logistics. Since we recently had somebody from Ascent on the show with Morrow, and you can go back and listen to the previous episodes, we're going to spend today talking about Roadrunner
00:00:33
Speaker
As a little bit of background to this, and we touch on it in the show, Chris joined Roadrunner at a very difficult time in their history. And we're going to learn quite a bit about what it takes to approach a company that may be at the end of the road, no pun intended, and bring them forward into the future. So I hope you enjoy the episode. Chris, welcome to the show. Thank you very much for having me.
00:01:03
Speaker
So let's just start with a little bit of background. Tell me a little bit about how you got into the industry and why.
Chris's Journey from Immigrant to Logistics Leader
00:01:09
Speaker
It's a bit of a convoluted part. I'm an immigrant from Poland. I ran away from home when I was 15, nearly 16, and then through France, England, Canada, and I found that I'd end up in my beloved United States, which has always been a dream of mine. Since then, I started in investment banking with
00:01:29
Speaker
some sort of mainstream firms. And then incidentally, as a banker, I was asked by one of our investment banking clients whose company was in a bit of a technical bankruptcy to see if I could step away from being an advisor and consultant and actually be an honest operator. And he paved the path to an honest way to make a living, as he phrased it.
00:01:53
Speaker
I walked in from having a corner office on the top floor of one of our AAA buildings in Toronto. I'm managing a major franchise of investment banking. Then I got an office tucked in at the mezzanine level of a warehouse overlooking a bunch of armored trucks and then PND routes. That's how my adventure with logistics started.
00:02:16
Speaker
turning around armored truck businesses and then becoming effectively a logistician. So I've seen executives who go in and they'll do a turnaround, they'll do a fix up, and then they just end up doing another one in a completely different industry and they see they don't care about what business they're in, but you've stayed in this space.
Challenges and Passion for Reviving Roadrunner
00:02:37
Speaker
So what was interesting to you? What made you stick around in logistics?
00:02:41
Speaker
I remember in my undergrad, there was a visiting professor who came and asked if anybody knew what logistics meant. And obviously, being a keen student, I was. I raised my hand, like, it's the ability to think logically. And he said, well, finally, you should say that because actually, it's exactly the opposite.
00:03:00
Speaker
is the out of moving freight and I was most confounded, just couldn't understand like how, like it just makes no sense. And I think I kind of found my niche and this is number seven, Roadrunner's number seventh on my resume. All of them were sort of wounded puppies to a certain degree.
00:03:18
Speaker
And I've developed this sentiment and love for aspect of movement. I'm kind of a high energy person myself. I love the kinetic energy and movement, and I'm fascinated. And I've always been fascinated by why and how those things that you find a textile in Far East that you want to use in a factory somewhere and then produce and sell it in the market far, far away, and how that complex supply chain gets executed and how many things can go horribly wrong along the way.
00:03:48
Speaker
It's been sort of a bit of a passion of mine for the last decade and a half. Well, as someone else who's been in the industry a long time, I will tell you that behind every shipment that arrives is a million mistakes that were made along the way every single time. So I get it. I think we all get excited about the same thing. Well said. You said you like wounded puppies, but some might argue that this last one was more like a dying bear than a wounded puppy. Why would you
00:04:17
Speaker
For those people who don't know Roadrunner, when Chris Jordan is coming off of the back of, let's say, some very tumultuous times, why would you take on that challenge? Listen, first of all, as I mentioned to- How insane are you? That's a very fair question. First of all, I'm a Polish guy in Chicago, and Roadrunner in Chicago, and it's trucking, so that's a part for the course. Number two, I think the most famous last words any Polak says before they die is, you think I can't do it? Hold my beer.
00:04:45
Speaker
So, this is how I got roped into this. It's definitely was the most challenging turnaround I've ever done in my life. And this, as I mentioned, this number seven done all of them required some sort of divine intervention to assure successful well-being in the past.
Identifying and Overcoming Roadrunner's Issues
00:05:03
Speaker
So, this has been particularly humbling.
00:05:06
Speaker
I've never seen anything as broken across every part of the organization, every functional area, any vertical, every layer. But what I did see was just an immense unbreakable spirit of the people. And I saw the relevance of the OTL industry, which is I have to admit is unlike anything I've ever seen before. I couldn't believe that you could inflict so many wounds upon yourself.
00:05:31
Speaker
to virtually alienate the entire customer base, insult everyone with your service, and yet have customers come in every day and entrust you with the cargo. So the need and the relevance of the LTL space was just so profoundly visible to me that I felt this business and definitely the people deserve the chance to give it ourselves the best shot and see what we can make out of it. And at the end of the day, I never believe it's the people as far as always the leadership failure.
00:05:58
Speaker
I think we fixed that and we've been busy for the last three years, my gosh. So when you come in and everything's broken, and I'm sure even though those people are great, their spirit probably wasn't that high. Where do you start? How did you start thinking about fixing it?
00:06:15
Speaker
But Roadrunner was sort of a roll-out blowout as David Ross at that time of Stiefel. Nicholas told me that, you know, he said, like, Chris, if you touch it, then it lives for another 60 days. That's about 30 days more than anybody would give it. And, you know, it was, you look at the very complex structure of mergers and acquisitions and predominantly acquisitions that have not been merged in any way, shape or form.
00:06:42
Speaker
And you start paying attention to what is the core of the business. And you're very familiar with Ascent. And Ascent was nothing but a group of sort of 3PL look like logistics businesses that we sort of piled up together and we spun out as a private business that since then, as you know, has been extremely successful. And then we started looking at an appealing of the lay and the lay and the layer.
00:07:06
Speaker
Businesses that may have been acquired that just didn't belong with the LTL premise and we wanted I wanted really my vision was to get to the pure LTL play and just see okay if this is that remarkable LTL business and by the way I didn't really know what LTL meant at that time now I do which means less than likely to go perfect.
00:07:26
Speaker
And then since then we got to the course, it's just stripping like the layer of a layer of paint by defesting furniture. I think businesses and getting to the core of what it is, which is, you know, that direct trucking business point to point, which is kind of amazing. And that in itself, which was not an easy process, took us nearly nine, 10 months to get to the bottom. It just, it gave the breath of fresh air to the business because there was no further distractions and people can focus on what
00:07:54
Speaker
I'm running used to do better well which was you know transport freight in a very check of trustworthy and confident fashion so i don't want to turn this into a roadrunner commercial but i am curious to ask this question so you peel everything back and now you've got this ltl core. What did you guys look at and say and this is why roadrunner is the ltl company that people should move their freight with like what became what's the value prop after you take all that other stuff away.
00:08:24
Speaker
You know, there was an interruption and that step was going to the customers going in terms of people and asking, okay, what do you think we do here stupidly? And boy, did they give us a list.
00:08:37
Speaker
And when we look at the list and we scrutinize these items and we kind of set aside exactly what we were doing, you just, we couldn't be doing this in the worst possible way that we were. And we started to sort of untangle the mess. We were no longer breaking down pallets because that's somebody along the way thought that'd be a great idea to increase cubitalization.
00:08:58
Speaker
you know, by breaking down pilot freight. And, you know, customers love that when they give you a pilot and they just can find it scarcely, you know, across 15 terminals, across two countries, and so forth. So we kind of started undoing the mistakes and empowering the people who have been
00:09:15
Speaker
in the fabric or the DNA of the company for, you know, in many instances for decades. And they did remember the original premise of the business. And then, you know, we started investing in top grading our talent and building processes and in creating feedback loops and saying, okay, what went wrong this time? And we've gone through a lot of this and customers have patiently born with us through these.
00:09:39
Speaker
Yeah, it's just always about building the processing driving accountability and kind of trying to see, you know, listening to the people listening to your customers and they will tell you what they wanted to do and they will definitely be very vocal about things they do not want you to do. Yeah, I would imagine.
00:09:55
Speaker
getting up and on that listening tour every day and hearing it was probably emotionally not the easiest thing in the world to do. Oh, I've heard it all. I've walked into any customer that looked at the two years, which is basically sitting up being yelled at, but you know, comes with the territory, right? If you own it, the business, the way we do, which we do own it.
00:10:12
Speaker
in a kind of both psychological and economic sense, you do want to listen and you do want to take responsibility because a lot of customers always will bet on an underdog. They will favor a fallen angel as long as they feel that there is a real sense of contrition, if there is a sense of commitment to get better and it's not just an empty promise and it's not another windbag of, hey, I'm doing your administration this time, this soup will not make you sick.
00:10:39
Speaker
If you commit to systemic improvements, if you commit to making things, and to us, you ask me a direct question, what's the value proposition? That was to see the point of a bit of an underserved market. First of all, it's a market that has not experienced a new entrance in the last 35 years, 36 years this year.
00:10:58
Speaker
with some incredible barriers to entry, which are a little bit tough to comprehend for a newcomer like I was. Because at the end of the day, I thought it's just, well, you just have a truck. It's a lot more complicated than that. It's a cost prohibitive to try to replicate the national footprint of
00:11:16
Speaker
action terminals by the end of the day you do have a number of phenomenally well-run carriers who offer regional national service and etc but what we did notice that even the best in class people they do not connect the points different points in the country directly.
00:11:34
Speaker
What they do they route the freight through a very well-executed network of hubs and spokes and through a shuttle service. And that is great and people do it extremely well, but it does not necessarily serve folks who need it that kind of direct, you know, straight shoot connectivity from LA to Chicago, LA to New York, Seattle to Atlanta and so forth.
00:11:55
Speaker
And in this business, as we now know, less than likely for everything to go perfect, what you do have every time the forklift touches that pallet or the pallet needs to reverse that through that 125 feet of crosstalk, something goes wrong. And if you reduce those number of handles and repackaging and rehandles, you reduce the risk of freight being damaged or things going missing, etc.
00:12:20
Speaker
That's what defined Roadrunner. This is what was our go-to-market strategy. Go with us. We're going to do it directly. We're going to run teams. We're going to run nonstop. You're not going to have them spoke. If you want to get from LA to Chicago in one day, give it to us on Friday. We're going to have it at your point of delivery by Monday morning.
00:12:39
Speaker
And that's effective what we committed to. We continue to execute and gradually overcome the skepticism and the hesitation from the customers have all heard it before. They all have seen numerous executives stand in front of them promising the different things, but it's commitment to that, you know, the sense of contrition and commitment to systemic data-driven processes and strict execution. I think that's what's kind of winning for us in the market. You just
Embracing Technology in Logistics Transformation
00:13:04
Speaker
said the word data in front of a tech CEO, so now I have to ask.
00:13:08
Speaker
I would imagine that when you apply a different model, the tech in the marketplace probably doesn't fit very well then. What have you guys had to do on the tech front to make this real? It's funny because for a sub-segment of the broader industry, when you think about LTL being 10% of the truckload industry or so, you would imagine that whatever the players or carriers do within that narrow band market, it would be very similar.
00:13:36
Speaker
No, every carrier is distinctly different. And if you try to apply a lesson that may have worked beautifully at X to a carrier Y, well, then you're going to be standing and there's going to be a beautifully mushroom-shaped cloud brewing behind your back because it would have end up in tears. So you're correct. You're absolutely correct. There's no off-the-shelf solutions. There is nothing
00:13:58
Speaker
that can be standardized. This is such an archaic industry. My good lord, people still deliver you a piece of paper and there's this big push towards electronification of the bill of lading. You just imagine just the low tech of the low tech of industry.
00:14:16
Speaker
And what we did, we brought in a bit of a psychopath with a strong background in artificial intelligence, working with NASA, working with utility companies to reinforcing the American energy grid through utilization of artificial intelligence. And I saddled him in the seat of head of technology and operations, and I asked him to fix it. Now, he's my younger brother, so there was an alternative motive to put him there. So you don't like him very much. I do love him.
00:14:45
Speaker
I've been waiting for the opportunity to get back in for a long time and it came in the form of a beautiful road runner. He effectively started to build everything internally. We also engage a lot of partners and looked at certain systems that may have been used successfully by our carriers with a very high degree of customization.
00:15:07
Speaker
We've developed our own machine learning algorithms to an extent off of the artificial intelligence which feeds off statistically viable data sets so we're feeding this as much data as we can as we increase the volume of our business and the scope of our breath of our reach with customers.
00:15:26
Speaker
And so we kind of really looked at things that really mattered. So first we built the processes because technology in itself is not a solution, right? It's just if you have a poorly orchestrated process or none of it at all, you're going to just make things go wrong a lot faster with no manual intervention. So you always sit down and say, I want to reduce the labor intensity of the task, where sometimes that labor intensity is your safety net. And if you get rid of yourself of that, then you can wake up to a lot of disasters. So we avoided that, but we focused on designing processes.
00:15:56
Speaker
We look at the enhancing enablement and the throughput efficiency of these process. We put our dock automation across our network to put dock scanning across. First of all, there was just bit of the catch up to the best in classes. There's nothing particularly innovative. It was just.
00:16:12
Speaker
Huge difference for Roadrunner, which was still kind of completely paper-based model when we inherited. And then subsequently, we went to kind of getting stuff that is a lot more sexy, such as creating our home now app, which is, by functionality, ranks and beats will be afraid up. And it provides our drivers with everything they need to do with self-dispatching, with picking out the lanes they want to run.
00:16:38
Speaker
seeing how much they're going to make effectively, just having full documentation, the complete business office of a trucker on the road in the palm of the hand. And that was probably the most significant one from pure technology perspective, but then reinforcing a lot of things from cybersecurity that we all have to be vigilant about and we know the stakes there.
00:16:58
Speaker
and everything else that includes that we can start executing things like today's announcement of guaranteed service and ability to kind of route parallel services and deal with any claims that hopefully we won't have any but if it needs to be fairly effective.
00:17:15
Speaker
a lot of sort of first, you know, catching up and then kind of focusing things. And, you know, the one thing that we are the most proud of now is our route marks dispatch software that's being rolled out nationwide and we effectively shaving, you know, gazillions of man hours of manual planning of pickup and delivery routes doing this through algorithmic functionality. So a lot of exciting stuff. When you took over RedRunner,
00:17:42
Speaker
There was too much stuff, too many acquisitions, all of this noise. You get it down to the core. There's always a temptation when you're being successful to then go start getting bloated again. Everyone has a new idea, right? Rates are down now, but when rates are up, everybody's a genius, right? And everybody wants to go have a new idea. Let's go buy that. Let's go expand. Oh, well, we can do this. Why don't we just buy an airline, right? Like all these kinds of things.
Staying Focused After Overcoming Challenges
00:18:08
Speaker
How do you guys maintain that discipline to not end up back?
00:18:13
Speaker
as a bloated monster. I think the wounds have not quite healed yet. The scars are still fresh. The humility is profound. The customers do remind us that we're always as good as the last piece of freight movement that we have executed.
00:18:30
Speaker
You know, I always say that everybody loves to pick Old Dominion because they're just such a phenomenal operator. But, you know, nobody gets fired for hiring Old Dominion, right? Old Dominion could, you know, probably mess up, you know, hundreds of freight moves and, you know, it'll be met with just, you know, people shrug it out.
00:18:46
Speaker
we mess up once. I mean, this is just escalation all the way to my inbox within, you know, 15 milliseconds. So I think that we need to have the benefit of time pass. I think we sort of the sense of mishaps pass needs to
00:19:02
Speaker
fully recycle. I think we are kind of one full economic freight cycle away from getting a fear of arrogance, kind of walking in or overjoy of creativity to be muddling our kind of crisp grip on the reality that we collectively have today. So
The Future: Tech Advancements and Collaboration
00:19:20
Speaker
as a question, I sort of like to ask everybody, which is, if you could fix something industry-wide as opposed to inside your company, what's the thing that is holding us all back?
00:19:32
Speaker
in your opinion? I think that'll be the technology. I think it's even electronification of the bill of lading, which is this holy grail that all eyes append on that and kind of understanding that we are all part of a supply chain that provides room for just anybody to be as good as we all want to be.
00:19:53
Speaker
There's always this little petty competitiveness urges that I see at times flare up. It's such a wonderful industry, but with limitations that we have, why can't we just get on well together and collaborate and put collective intellectual horsepower to the benefit of the customer for simplification of doing business with us as a collective.
00:20:16
Speaker
And, you know, there's some very notable initiatives right now through the Digital Council, and we're obviously passionate about that, but it's just, you know, what I think is missing is that kind of a win-win mentality and the orientation that is just, you know, that we could be part of the tide that raises all the boats. And, you know, it's quite inspiring to me, particularly as a newcomer who has never been burdened by decades and decades of rivalry and some historical context, etc.
00:20:42
Speaker
And maybe i'm oversimplifying that but i truly believe that working together as an industry on fixing certain you could benefit customers and kind of simplify and necessarily complex and complicated supply chain. Awesome and i guess counter side to that or the other side what has you excited what gets you out of bed in the morning.
00:21:04
Speaker
the
Roadrunner's Progress and Boosted Morale
00:21:04
Speaker
sense of the momentum that we've built and we're accelerating. Today, for Roadrunner to offer guaranteed service, who would have thought? Who would have thought when I go back to all the folks who were wide-eyed when I announced that Roadrunner is the nearest station or the new home base?
00:21:22
Speaker
Who would have thought that the company would ever be functional or capable of delivering service? Forget about on time, but guaranteeing in a way that it's a full guarantee, right? It's like if we do something, we do it like we mean it, right? It's like if we don't deliver, it's not just a little thing that you get back. You just move your freight for free with us. So those kinds of things and opening the new markets and seeing partners come up to us and asking us to help them and join forces in opening new markets and new lanes.
00:21:52
Speaker
New customers calling us and say while you know three years ago i was a never roadrunner and now i'm becoming your ambassador. Those things are just so positive as you see the momentum you see the positive changes see that people are walking taller in the office and becoming a.
00:22:08
Speaker
I'm not the only one wearing the Roadrunner branded garment, the corporate propaganda. You see the folks proudly displaying the Roadrunner logo, the new logo, which is fantastic on the social media posts on the weekends. You see that we're winning the battles for the hearts and minds of our own employee cohort. We're winning the customer battle. We're getting better. It's just exciting stuff for logisticians like me who like to think logically.
00:22:35
Speaker
That's how you got me fired enough that I'm about to go open up another browser tab and then go to apply for a job. So let's have to see what's out there for me. I don't know how qualified I am anymore to actually do real work, but let's see what we can figure out. Oh, you're too kind. Again, it's a pleasure having you on and we'll put the links to Roadrunner and all the details and the announcement in the show notes.
Closing Remarks and Well Wishes
00:22:54
Speaker
And again, just thanks so much for being here. Thank you so much for having me. It's such a delight to be your guest today. Thank you. Thanks so much to Chris for sharing
00:23:05
Speaker
All of that insight, you know, it's not common in this industry to be able to talk to someone who is so open and obviously passionate about what they're doing. And I wish Chris and Roadrunner all the best. We'll have some links in the show notes to the announcement on their product offering as well as to Roadrunner in general, and look forward to speaking with you next time on Spy Chain Connections.