Venturing into a segment that has recently acquired significant traction, Blume Global aims to outdo all of its contemporaries with its humongous network, intense penetration and exhaustive breadth of services that can simplify the complexities of global supply chains in the best way possible. It is the only cloud-first, digital supply chain orchestration platform that provides both end-to-end visibility and execution capabilities to all participants in the ecosystem. With 10,000+ logistics companies on the network, 1.5mn+ intelligent locations, 130+ countries, 750+ air cargo carriers, 48 ocean carriers and 65k+ suppliers, Blume Global has till date, successfully yielded the three determinant pillars of effective supply chain management by- Fiscal, Environmental and Social empowerment of all the stakeholders who have subscribed to their services. Having shipped 81mn+ shipments tracked per month, the software positions itself to eliminate major logistical challenges like fragmented and complex international shipping, extremely high agility expectations of consumers, supply chain disruptions-regulated market needs and the growing need for sustainability. Holding all of these sacred, the company’s Chief Executive Officer Pervinder Johar narrates and reveals to Twinkle Roy the unique story of Blume — the challenges that they overcome, the discoveries that were made in the way and last but not the least, the overwhelming successes that claim its arrival in the market.
Every organisation/product stems from an idea that drives the feasibility of the solution. What was that idea for you? What compelled you to come up with this entity standing strong now as Blume Global?
It all started with the idea of a map of the world but from a supply chain perspective. If you pose a question, inquiring about the locations of all the ocean terminals in the world, it is certainly not an easy task to find an answer to that. Although, in the case of an airport, the passengers get information regarding their flights but that information is not critical from a cargo perspective. Cargo locations are 5 to 10 miles away, so one can imagine how different the schedules would be. When we started the company, I narrated all about this map that we are going to create, to my wife and daughter. Eventually, six months back, when I showed it to my daughter and wife, they exclaimed with surprise, looking at it all materialising into something real, more so because they did not anticipate it actually developing into a full-fledged entity, initially. They were unsure of the efforts that I had been putting in and they were taken aback by the outcome of all of it.
Digitising every operation, such that you create a digital twin of the whole supply chain- that was the underlying idea. We wanted to create something that simply did not exist or something that would retain its usefulness for the next 50 years, rather than losing relevance in just a couple of years. And, with that in our hearts and minds, we created the Blume Global software.
What are the pain points in the current scenario that Blume Global aims to tackle through the new trucking software ‘CarrierGo’?
When we founded the company, we had to first identify the problem. We found out that the basic problem would be the supply chains all across the globe and the solution to it was digitisation of that vast stretch, that is, by creating a digital twin and orchestrating the supply chain to implement simulations on the model created. And, the third part to this solution was identifying the companies that make up a supply chain. When we analysed that, we found out that 90 per cent of those companies are small businesses. That is where we understood, the major pain point was and hence, we focused on that primarily.
For trucking too, it is no different. In the US, 90 per cent of the trucking companies have fewer than 30 trucks. India presents a very similar problem. And the major challenge lay in the fact that digitising an entire supply chain would not be possible unless the technology is accessible to every participant in the supply chain. The CarrierGo software is focused on the trucking companies for managing their end-to-end business more effectively. Unless all the companies in the supply chain have their operations digitised, you can’t make a large supply chain digital. So CarrierGo aims to do all of that through its fairly low-cost operating platform, that makes it accessible and affordable to all.
A few hundred trucking companies have already started using it by downloading the mobile app, as it has been functional for the last three to four years. But since it is now fully baked, with customers who are using the app quite successfully, we look forward to working with the freight forwarders all across India and focus particularly on the ocean carriers, through a thorough upscaling of the product.
Just out of curiosity, I would like to ask if these truck drivers who use your software, most of whom are not that academically literate, needed any special assistance, training or instructions as to receive guidance on how to use the app?
Technology is only powerful if it is intuitive in nature. If you think about the other devices like something as basic as a mobile phone, we didn’t really get a training session to use that. It never came with a manual and the same goes for our app too. We focused on making the technology intuitive enough for a driver to use the mobile app easily and get instructions etc through that. It runs on iOS and Android devices, so you don’t need another device to run it on.
When you create something new, change management is paramount so that you don’t have to worry about the details of transitioning into that. And, beyond that, the focus is on the idea of rendering convenience to those processes. I started working on trucking softwares probably 24-25 years back but then, the focus was mainly on the large companies that owned nearly 10,000 trucks, because, only then, we could help them with optimising their fleet. Now if you go back to 2000 or 2001, computing was not an easy task for companies and hence, we systematised the working of the largest LTL companies.
Twenty years later, technology has come to a point where it is not just intuitive and accessible, but you can also run it on your phone, without requiring a special purpose hardware. So considering the fact that now the same technology can be easily used by a company that runs as less as 5 trucks, you can fathom the depth of the change. For us, the tasks are complex but we need to make it look simple to our users. That is where most of the hard work goes.
Tell us briefly about the USP of your functions, that makes your products distinct and loudly announces your arrival in the segment.
We are starting off with a focus on imports and exports and focusing particularly on how a container moves following its basic trade route. Now that we are connected to 170 countries, irrespective of the fact that a company is focusing on the first mile or last mile, just the mere presence of a company on our app will be beneficial for multiple businesses who are looking for one desirable vendor all across the nation.
Every user gets to use the Blume Maps and get immediate access to easy answers for, say, addresses of warehouses, airports or any specific directions. Once we set that location up in the software, no other trucking company needs to set it up again. I would say that our unique selling point is that we are escorting stakeholders from the middle of nowhere to assimilate them perfectly in the ecosystem.
Your organisation not just deals with end-to-end visibility but it also claims to offer execution solutions. Can you hand-hold us through the portfolio and guide us through “which is which”?
We serve three different segments. The first is asset-management for, for example, the truck drivers that own trucks. Similarly, ocean carriers, motor carriers, railroads are all asset owners. For them, we do asset management and optimisation, that is, to ensure that the utilisation is maximum, which again also helps in minimising waste.
Second part will be best exemplified by a press release published by us on Kuehne Nagel working with ocean carriers and trucking companies on one side and shippers on the other side. The idea is to identify how to execute an order that comes from a shipper after figuring out the multiple legs that are there for that order. A company might be working with multiple trucking companies, railroads and ocean carriers, so to facilitate that entire execution or orchestration we bring onto the platform intermediaries like freight forwarders.
And, then there are shippers who aim to serve those functions themselves. For them, it goes a step beyond. That is precisely where our sourcing and procurement functions come in. So as an intermediary, we are helping with order management. In simple terms, the three products are- Blume Logistics (of which, CarrierGo is a part), Visibility, at the order or shipment level and Orchestration, that is, how a company can bring all of these things together.
Can you give a brief picture of the agility with which Blume Global’s Route Intelligence plans optimal routes. What has been the average response time of the Blume Global in predicting alternate routes and its cost implications?
The alternate paths are discovered and suggested in real-time. As soon as we identify an issue, we start looking for an alternate path. Firstly, the system starts predicting the possible paths even before the cargo starts moving, in order to map all the ways available to us to ship the cargo from point A to point B. Sometimes shippers go for air cargo if they have time constraints. When shippers go for ocean and rail as an option, we primarily look at the origin and the destination countries and their respective norms and processes to figure out the time and the route that will be best suited for the shipment.
On an average, if you have a product being manufactured in Asia, and it is supposed to travel all the way to the US or Europe, there are as many as 14 companies involved. So the origin and destination is fixed and that indirectly means that most of the work needs to be focused on the other terminals that fall in the path, the capacity of the freight that is being facilitated and what best can be done to assimilate the pieces of that product from different points in the route.
Typically, the prediction for an alternate path varies by the mode. So, when we look into ocean freight, we already know that the shipment delay will be a matter of days. For trains, the same must be a matter of hours and for trucks, it will most probably boil down to minutes. We also receive constant updates of the load being carried by an asset such that if the load gets rejected, we receive instant information that the primary provider will not be able to pick it. So, the moment this particular information reaches us, the load gets transferred to a second provider. This information might take seconds to be passed on and, in some cases, it might even take hours. All of this, more or less, depends on how long the route is and how long it will take us to go through the entire process, all over again.
Sometimes, overreacting about the cargo does not help because even if the shipment is running late or early, it does not always necessarily mean that it will arrive in its destination late or early.
How do you aim to bring all the siloed information to one place? What are the hurdles that you aim to overcome in this path?
Being a company that deals with cloud software services, we ensure that all the information is stored at one place, such that it is usable and accessible to everyone available on the platform. That is a huge task to maintain as the software is currently operational in 130 countries. And, now that we are aiming to expand it to 170 countries, from a technology perspective, the task becomes even more complex. Above all other complexities, the most intricate is making the collective intelligence of the software perfectly suited to the individual intelligence of all the participants spread across global supply chains of companies, who form the very ecosystem of the software. Due to the plurality of the participants’ needs, the cognitive intelligence problems that crop up in dealing with them are quite varied.
Along with that, one of the major hurdles that we face is data privacy issues. Every country has its own data privacy norms and requirements that need to be adhered to.
We all know that there are functions within this entire process of freight movement which are essentially handled best by human minds. Contract management is one such function. But since your suite of solutions not just claims to help with improved contract negotiation but also promises to provide info that will be vital in formulating contracts, it would be really insightful if you could share a little bit about the above-mentioned function.
Contract managements, however essentially human they are, are all about negotiations that revolve around a game theory. Our models enable a perfect automation of the price that is arrived after a simulation of the negotiation. The software intelligence takes into account the capacity and the market prices. This works in a way very similar to that of booking a hotel room from websites which show all the prices and accordingly, present an effective comparison of all the rates. The best rate is hence, arrived at through that comparison.
Our software firstly stores all the historical data, which further lets the participants know if they go beyond the bounds of the market. Simultaneously, they are also constantly informed about details for sourcing of components, that is, through a thorough comparison of component prices by a showcasing of prices quoted by nearly 100,000 companies that are currently part of the platform.
However, one must remember that the human part in the contract management process is not the negotiation, rather it is the relationship part. The fact that individuals wish to engage in business only with the selective people they trust, will always remain the foundation of all business deals. The technical part of creating the perfect simulation of negotiations is achievable but the trust factor will always remain essentially human.
How does your app analytics deal or supervise performance management? Are these criteria self-revised by self-learning or a systematic observation of the current scenario?
To measure performance, we take in all criteria required for a perfect analysis. But we believe that, sometimes, improvements are best introduced or suggested by merely showing what is faulty. For an LSP, there can be multiple criteria- Do they accept every time an order is placed? Do they deliver orders on time? Have the products ever been damaged? Is the provider cost-competitive?- so on and so forth. Some of these might be important for the customers and some might be insignificant.
We ensure that the services go through a full cycle of performance management- figuring out how to improve, measure the outcome after making changes and then finally analyse if the product or the service is within the predefined bounds. The interesting or noteworthy fact here is that the services which seem to be absolutely perfect in the present, often go out of that perfection within another six months or so. This makes re-analysis equally significant. Unfortunately, reviewing the outcome and receiving quick results after implementing changes was not an option earlier. We used to wait for a year to see if savings anticipated by us have materialised. Today, this has become an instantaneous process, which helps us make sure that we don’t fall prey to static operations on our end.
As a principle, we never stick with one metric because every metric is suitable according to a certain economic context and economic environment. The question that remains essential to be asked here is: does that particular problem impact the business? Impact analysis is important and only then, we can understand which metrics are indispensable and which can be treated as secondary.
Can you give us an idea of the logistics spend and empty miles reduction that has already been yielded through Blume Global’s services?
Logistics is an 11 trillion dollars market, so giving exact figures for percentage of spend reduction is a bit difficult but typically, the customers that are using asset optimisation services, see between 15 to 40 per cent of reduction in empty miles. Given the impact that empty miles have on operational expenses as well as the environment, that is quite commendable a number. However, we aim to arrive at 60-80 per cent of empty miles reductions in the future.
Brief us about your near-term and long-term targets that will make your partnership and vendor network more expansive and more diverse, bringing the fragmented industry into this solid integrated whole?
For us, our strategy is twofold- first, we wish to expand in terms of the countries where our services are available and second, we wish to penetrate deeper into the offbeat locations as well. To accomplish the first part, we are aiming to reach 170 countries, over the next 12-24 months. On the depth side, our penetration is strongest in North America. About 86 per cent of the total capacity is connected to the Blume platform, which is a praiseworthy figure.
We are currently present in every South Asian country but from the depth perspective, India is our primary focus. In India, we have started the operations a couple of years back and we have received significant traction. For Japan and Australia as well, our strategy is similar. We expect to make progress in these locations too, in the forthcoming years.