The number is eye-popping, but the tangible results are game-changing. Last fall, logistics powerhouse C.H. Robinson (NASDAQ: CHRW) announced a $1 billion technology investment over five years across its operations. That money is being invested to improve innovation, add new features and functions to existing C.H. Robinson platforms and help build out needed infrastructure to ensure the company is positioned for the future.
It also is being used to help launch Robinson Labs. Formally announced on Thursday, Robinson Labs is an innovation incubator that will help design, develop and launch innovative solutions for C.H. Robinson, its shipping customers and carriers. The key word is solutions, explained Bob Biesterfeld, president and CEO of C.H. Robinson.
“It’s not just about developing software, it’s about developing expertise,” Biesterfeld told FreightWaves. “It’s a new way to bring innovation to life for our customers. We’ve always tried to be very customer-centric. … I think in the last two or three years we’ve become even better at that.”
Biesterfeld said Robinson Labs will have its own dedicated team of data scientists and engineers but will be able to tap into the vast resources C.H. Robinson has at its disposal – resources that include more than 1,000 data scientists, engineers and developers.
“We’ve been building towards the incubator concept for a few years,” he said. “The announcement is really the culmination of [years of work]. We feel it is the best way to leverage a global talent base that isn’t encumbered by any [legacy solutions].”
Biesterfeld said Robinson Labs, which will be led by Tim Gagnon, vice president of analytics and data science at C.H. Robinson, and include data science teams based in Minneapolis, Chicago, California’s Silicon Valley and Warsaw, Poland, is already working with customers to identify pain points and the “group goes to work swarming on that.”
Data scientists and engineers are embedded with customers so they can get to solutions quickly, he said.
In November, C.H. Robinson was named to the No. 9 spot on FreightWaves’ annual FreightTech 25 list of the most innovative technology companies in logistics. It is the second consecutive year the company has been on the list. Among its technology innovations are the flagship Navisphere platform and the Navisphere Vision software-as-a-service (SaaS) platform that allows clients to leverage C.H. Robinson’s technology investments to gain improved visibility into their own supply chain operations, optimize processes and access data and reporting on one platform.
The company also launched Freightquote by C.H. Robinson in November. The web portal offers capacity-sourcing capabilities to small and midsize businesses for most modes of transportation. The platform allows shippers to compare real-time rates from C.H. Robinson’s network of approved carriers and book their shipments via credit card. Additionally, the system provides the shipper with load tracking and shipment notifications.
The broader picture is how Robinson Labs will leverage the overall investment in technology to enhance these and other products. For example, with the Robinson Labs benchmark tool, shippers can reduce costs by altering lead times and volumes, as well as improve dwell times and on-time performance.
Biesterfeld said this type of deep dive into data is important to help customers understand how cost variables, such as when and where goods are being shipped or origin and destination point attributes, affect rates.
“All these variables are associated with what ultimately develops a truckload rate for a customer,” he told FreightWaves. “Robinson Labs has been working with customers to try and understand what is [causing these changes] … so they can understand what they can control.”
Biesterfeld said that solutions developed within Robinson Labs could be rolled out across the enterprise.
“I like to think about it as a sandbox,” he said. “In some respects, we are focusing on really specific outcomes and problems for customers, but like a sandbox, they are also playing with new ideas.”
Speed to solutions is a primary advantage of launching a separate entity to develop solutions, Biesterfeld said.
“Because these teams are not necessarily encumbered with ongoing projects, we are able to be more reactive for customers,” he said. “I hope the customers feel a lot more responsiveness from us … and I hope they feel we are delivering value.”
Biesterfeld said that Robinson Labs is part of C.H. Robinson’s three-pronged goal: Build new solutions for new problems for customers; drive more efficient business opportunities for carriers; and develop internal processes that make employees more successful.
“I’ve been asked if this is something new,” Biesterfeld said. “This is just another proof point. This is another example of how Robinson is trying to invest in its leadership and supply chain [by] bringing together smart people, global expertise, technology and solutions.”