With platform, J.B. Hunt takes next tech step

Stuart Scott, J.B Hunt's chief information officer
Stuart Scott, J.B Hunt's chief information officer

The field of technology upstarts "uber-izing" the trucking industry is getting crowded, from Convoy and Transfix to Uber Freight and Cargomatic.

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Special to the Arkansas Democrat-Gazette

Shelley Simpson, executive vice president, chief commercial officer and president of highway services at J.B. Hunt

In Arkansas, J.B. Hunt, one of the largest legacy trucking companies in the country, had been observing all of it and quietly building its own internal platform.

The Lowell company now employs over 900 people between engineering and technology, over 100 of whom played a role in building Marketplace, the latest addition to the J.B. Hunt 360 transportation-management platform.

J.B. Hunt 360 has been available since 2014 as a self-service interface for customers to see things like rates and shipment status in real time online. Marketplace adds an artificial-intelligence and analytics-driven automatic load-matching capability, an answer to similar technology offered by some of the aforementioned companies.

While J.B. Hunt employees have been using the technology internally over the past few years, the service was recently released publicly to any shipper that signs up and any carrier that passes a vetting process.

When he announced the news, President and Chief Executive Officer John Roberts said that about 100 offers were being accepted per week, "without people making phone calls in or out."

The traditional process of matching a load to a driver is cumbersome, generally requires many phone calls and can take hours or days.

"Anyone who needs to ship freight through J.B. Hunt can utilize J.B. Hunt 360 to quote and book shipments, track loads, and view analytics," said Stuart Scott, the company's chief information officer.

Carriers who are approved by the company "have access to J.B. Hunt 360 to place offers on and manage loads from a desktop or mobile device," Scott said.

Why trust J.B. Hunt over Uber Freight to handle this? According to Scott, the company's experience in the industry will set its technology apart.

"Our platform encompasses the latest industry technology with our 55 years of operation experience," he said. "That combination gives us a competitive advantage over those with less transportation and logistics experience."

However, the company is still paying attention to other companies in the space.

"I don't dismiss online-based companies," he said. "They can be doing very innovative things, so you have to keep a close eye on what they're developing."

At a recent event featuring Uber Freight executives in Bentonville, about half of the room's attendees were from J.B. Hunt.

Matthew Waller, dean of the Sam M. Walton College of Business at the University of Arkansas, Fayetteville and founding chairman of the department of supply chain management, said that J.B. Hunt has historically not shied away from adapting its business as things change.

He cited the creation of the company's brokerage and intermodal segments, both of which appeared counterintuitive since they both involve the company passing on loads to other carriers and to the railroads.

"What J.B. Hunt is good at that most companies are not good at is applying creative destruction to themselves," Waller said. "What that means is a lot of times companies want to take the advantage they have in the marketplace and just milk it. But if the company is not constantly competing against themselves, they'll eventually disappear."

He pointed to the taxi industry's inability to adapt as Uber and Lyft entered the market and revolutionized it.

"Imagine if the taxi industry had done what J.B. Hunt is doing and gotten ahead of the curve," he said. "But they just sat on their laurels and expected life would be this way forever, even though there was new technology that could change that."

"History shows that there are no examples of companies that stay put forever," he said. "There are always competitors that come out of nowhere. These companies arise because they see an opportunity to make money and to make everyone better off in the process."

He explained that this "creative destruction" is inevitable. "The question is, is it going to come from the company itself or from a competitor?"

Scott also argued J.B. Hunt's history plays a role in this.

"We have a culture deeply rooted in innovation, so we're constantly thinking about the next big idea to impact the industry. That includes having the agility to adjust to a changing economy and needs of our customers."

At the same time that it released Marketplace in April, the company also announced that it would invest $500 million over five years toward its engineering and technology in order to, among other things, create "innovative and disruptive technologies."

One of the market changes Marketplace could address is the rise of e-commerce and less-than-truckload demand. Less than truckload means filling a truck with many different shipments going different places (like e-commerce deliveries), vs. a full truckload shipment of one product going somewhere.

"To accommodate the changing supply chain, especially as a result of the rise of e-commerce, J.B. Hunt has grown its less-than-truckload ... services greatly," said Shelley Simpson, executive vice president, chief commercial officer and president of highway services.

The company declined to quantify this growth.

"Expanding our core business services allows J.B. Hunt to provide more customers with customized supply chain solutions," she said. "For the small-business and microshipper community, the availability of unique and efficient shipping services is integral to their success."

As to how J.B. Hunt will benefit from releasing this technology, Waller said it all comes down to information.

"If more and more carriers and shippers are using the platform, [J.B. Hunt has] better insights into the entire market. They have better insights into where freight is flowing, which helps them make better decisions about where to position their assets," he said. "It basically helps them operate better, because they have more information."

"Information reduces uncertainty, generally speaking. The more information you have, the less uncertainty you have, the better you can plan. The better you can plan, the lower the your costs and the higher your revenue."

SundayMonday Business on 05/07/2017

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