SUMMARY

Gina Chung is the Vice President and Head of Innovation Americas at DHL. Gina leads the research and innovation activities of DHL and is in charge of the DHL Americas Innovation Center: a state-of-the-art platform to engage startups and industries on the future of logistics. Since 2012, she has shaped DHL’s global innovation agenda by driving a portfolio of projects focused on the rapid testing and adoption of technologies such as collaborative robotics and artificial intelligence across DHL’s operations.

Brad and Gina discuss DHL’s new Innovation Center and how it creates a unique customer-centric approach to logistics innovation. They cover everything from how DHL is predicting trends to why startups are important to DHL’s innovation process.

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Brad Hammond & Gina Chung at DHL Innovation Center

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TIMESTAMPS

Gina talks about the DHL Innovation Center – 01:10
The future of innovation in logistics – 06:35
Gina walks us through DHL’s wearables innovation – 07:40
Predictive analytics and how they affect logistics– 09:10
How & Why DHL works with startups – 10:21
Innovation Hotseat with Gina Chung– 11:39
Innovation is not technology – 15:06

How can you measure innovation and success? – 17:31
DHL’s Trend Radar – 18:54

FULL TRANSCRIPT

Brad Hammond [00:13]: Welcome to Ask an Innovator. My name is Brad Hammond. I’m your host this week. Josh, your normal host is out at CES Las Vegas, checking out some neat things with some clients and customers. Today we have Gina Chung. And she is at DHL in Innovation. And I’ll let her kind of take it from here and introduce herself.

Gina Chung [00:34]: All right. Hi, everyone, I’m very happy to be on the podcast. So I’m Gina Chung. I’m Vice President and Head of Innovation Americas for DHL and I’ve been with the company for seven years. My role primarily is to engage with our customers, partners, as well as internal operations to leverage new technologies to improve logistics processes.

BH [00:59]: Awesome. Well, it’s nice to have you Gina. We’re here in one of DHL’s Innovation Centers. So if you could, maybe tell me a bit about where we’re at and yourself, I’d love to hear it.

GC [01:10]: Okay, great. Maybe I’ll start a bit with DHL because I know that not everyone is familiar with who we are and what we do. So DHL, it’s the world’s largest and leading logistics company headquartered in Germany. We operate in over 220 countries and territories with over 550,000 employees.

So we operate at a very, very large scale. And what we want to do is we want to be not just the leading logistics provider, but also the leading innovator in the industry. And one of the ways that we do this is through our Innovation Center approach. We use these Innovation Centers, we’re actually at one of our most recent Innovation Centers here in Chicago.

Innovation Centers they are built to put, they’re actually purpose-built to engage with our customers on the future of their supply chain, to engage with our customers on challenges that they’re facing in their industry, and then to come to a joint roadmap, with our customers on potential innovations that we could pursue together.

BH [02:11]: Excellent. So could you tell me a bit about the space we’re in? So when I walked in, I saw this amazing space. It’s hard to even describe but it’s, kind of, you have different stations, all sorts of things set up. It’s really neat. So could you tell me a bit about where we’re at and where we’re sitting in right now?

GC [02:29]: Sure. So the Innovation Center here in Chicago, we just launched it in September 2019. So it’s a brand new facility. It’s 28,000 square feet. And it’s purpose-built. In terms of the showroom that we’re actually sitting in right now, it showcases many of the different trends that we see impacting the industry, as well as also some of the tangible solutions that we’re beginning to pilot or have already started to implement across our business.

So you’ll see many robotics and automation solutions at the Innovation Center. We don’t just showcase the robots. We also share some of the tangible insights that we’ve gathered from our robotics projects, as well as some of the challenges. There is also a variety of different demos that we’re able to give off some of the platform solutions that we’re developing together with partners, for example, surrounding visibility or temperature control.

So I always say it’s we’ve got, probably almost all logistics innovations here under one roof. And depending on who you are, depending on the customer’s industry, we’re able to customize the content in the innovation center so that we only present the most relevant topics and solutions.

BH [03:37]: So what would that look like then? So if I’m one of your customers, I think you said you have 10,000 people or so that kind of walk through these centers, what does that process look like to kind of come out to DHL and visit one of these innovation centers?

GC [03:53]: So globally with our Innovation Center in Germany, as well as in Singapore, now in Chicago, we have around 15,000 visitors. And what a visit typically looks like is there’s a lot of pre-alignment that goes on and that’s because we apply a customer-centric approach to innovation at DHL.

We really want to first understand what are our customer’s pain points, what are their challenges? And from that, we then tailor the experience. So a couple of calls, a couple of meetings even upfront, without customers to really understand what are the topics they want to focus on? Is it innovations pertinent to distribution, to transportation, last mile? Do they want to focus more on visibility? Do they want to focus on their industry so you know, pharmaceutical supply chain versus an automotive supply chain?

So there’s a lot of pre-alignment that happens. We then set the date for the visit here. We also make sure that for their visit, we have the right people around the table. So we have the right kind of executive-level decision makers joining these visits with our customers. We have partners joining these visits sometimes as well to present as an expert so that when they come to the Innovation Center we’re able to they’re able to leave with decisions and commitment as well.

BH [05:05]: So maybe you could tell me a bit about how the Innovation Center ties into your overall innovation strategy at DHL and how that’s evolved over the last few years as well?

GC [05:16]: I think evolves the right word, because it has evolved a lot since I joined over seven years ago. So I would say, seven years ago innovation, it’s part of our DNA, but it was nowhere near as where it is today, which is at the height of our corporate agenda.

So when we first started seven years ago, with this new customer-centric innovation approach, I think innovation was a lot more about how can we leverage these new technologies directly with our customers and their operations? But it has since evolved into how can we leverage innovation across our entire network across our entire operations?

And if you follow DHL, we actually released our new corporate strategy in September last year, which outlined our vision for 2025. And that is to deliver excellence in a digitalized world. So our new corporate strategy, it centers itself around digitalization. We see it as the next turning point. And our company’s evolution of if I can put it like that.

So we’re investing over $2 billion in the next five years, just on digitalization. And the Innovation Centers are a key part of that transformation, a part of that investment as well to accelerate change, essentially, in the company.

BH [06:28]: Now, what are some key areas of innovation you see within logistics, you know, the next 5, 10, 20, even 50 years?

GC [06:35]: That’s a big time-frame. I would say just in the next five to 10 years. Again, it depends on the market. But in my regional role, if I look at here in North America, for example, the biggest topics I see are robotics and automation, especially in our warehousing business.

Just the speed at which, you know, new solutions are being developed and coming to market and the results it’s delivering, I can just see the tipping point. We’re approaching it very soon for autonomous forklifts, you know, spreading across our operations, all sorts of different autonomous mobile robots being leveraged.

Analytics is another big topic and has been for many years now in the company. I think that’s one that’s relevant to all regions. There’s so much that companies can do from you know, tapping into the data. It’s no secret. But we still have so much more to go. Even though we started the journey many years ago.

BH [07:26]: I think you’re even showing me just some innovations you guys were working on. You know, the analytics platform and then even some safety and equipment stuff that you’re working on in warehouse, could you go into a little more detail and kind of a couple of those projects?

GC [07:40]: Sure. So maybe I’ll pick the wearables one that we touched on briefly. So we’re, we’ve been also looking at digitalization, not just from a pure, you know, how can we make things move faster? But also how can we leverage technology to improve the lives of our workforce and health and safety in our workforce?

One of the projects that we started last year, here in the US, was the use of wearables to improve movements in our operations. So it’s a wearable device that you can attach to your belt, and it can detect whether you are bending, twisting, reaching correctly. That really is determined by: if you’re using your knees or if you’re, you know, balanced properly.

The wearable device, it’s incredible how much you can pick up just from, one location on your body. We started the pilot in the US, saw tremendously positive results from our first pilot, expanded that to a longer pilot end of last year with over 500 devices being used.

We’ve seen that by using these devices, not only do we significantly reduce the number of wrong movements in our operations, we can also reduce the number of back injuries as well as also serious workplace injuries. This translates into a healthier workforce, obviously, but also, you know, reduced sick days for the employer as well. So I think that’s just one great example of how you can leverage technology in a very positive way and in a way that also helps your workforce.

BH [09:02]: That’s awesome. And you’re showing me too, the predictive analytics platform as well? That was really neat. Could you tell me a bit more about that?

GC [09:10]: Going back to the Innovation Center in Germany, one of the big asks of our customers around, now six years ago, was DHL with your global footprint and expertise in logistics, how can you, help me predict some of the risks that are going to happen to my supply chain?

This was around about the time that they were those natural disasters happening in Japan with the earthquake and the tsunami, with Iceland and the volcano. That actually started the journey for us as a company to develop Resilience 360, which is now one of the industry’s leading platforms to predict risks and to manage supply chain risks. What it does is it leverages data from a variety of different internal as well as external sources to predict any type of risks, whether it’s weather-related, whether it might be supplier-related, social-political risks, and alert our customers in near real-time, 24 seven of disruptions to their supply chain.

BH [10:06]: That’s awesome. So shifting gears a little bit here you’re showing me how DHL involves the startup community within your innovation approach. Can you tell me a little bit more about how startups are involved and how you engage them in innovation?

GC [10:21]: Sure. I think startups for us, they are a key source of innovation for DHL. So we partner, I would say the vast majority of our innovation projects we partner with startups in robotics and analytics and wearables. And what we do is we have a team at DHL that scouts startups based on the challenges and needs of our business and of our customers. And then we engage through a proof of concept.

If it’s a very brand new use case that we haven’t explored yet or a pilot, if it’s something we’re more familiar with, we do this in a very agile way so that we can very quickly test if something works or if it doesn’t work. And if it works, we then move it further along and our final to industrialize it, to then scale it across all operations. We will really do this in a very close, tight-knit partnership approach.

BH [11:09]: Why did you decide to go kind of the startup route instead of doing all the innovation internally at DHL?

GC [11:14]: Sure, I think that has changed as well over time. Maybe in the past, we did a lot more of the innovation work in house, you know developing our own sensors, developing hardware ourselves. We just realized with the speed of technology that we can’t be the ones developing everything. And that’s what really drove us to partner with startups early on, to almost see them as an extended development arm of our innovation activities.

BH [11:39]: Hey Gina, let’s take a break and you’re in the Innovation Hot Seat now. So I want to hear a little bit more about you. And I want to hear some answers to some of these questions that I’m going to kind of throw your way. So, first question is, what podcasts do you subscribe to?

GC [11:57]: This is probably going to be very controversial, but I don’t actually subscribe to any podcasts.

BH [12:03]: Really? Okay, well, maybe one now. Okay. Are there any other people you follow or blogs you read? Anything as a replacement for that?

GC [12:16]: I’m a huge reader. So maybe that’s why I don’t listen to podcasts so much. I love reading articles and reading books. And I just finished Superintelligence, which I thought was excellent. I also love watching YouTube videos, probably How It’s Made is one of my favorite channels since I was a kid. So just yeah, those are probably the ways that I read and follow up on things.

BH [12:37]: So if you were able to invite one person to dinner that’s alive today, who would it be and why?

GC [19:39]: Oh, my God. One person, that’s alive and invite to dinner? I would probably invite Stephen Hawking. Huge fan of his work. And I also have a little bit of an interest in astrophysics as well.

BH [13:03]: Awesome. What’s your favorite place that you’ve traveled to? And why?

GC [13:08]: Favorite place that I’ve traveled to, I think probably the place that I’ve enjoyed the most. Now I’m gonna get in trouble for saying this one. So let me just think, I was gonna say New Zealand. I’m like, that’s where I’m from. Yeah, I think probably the favorite place that I’ve traveled to is Cambodia. I really enjoyed the people and the culture there.

BH [13:28]: Awesome. So what’s the first thing you do every morning?

GC [13:31]: First thing that I do every morning is I read messages so I’m from New Zealand mentioned this now a couple of times so it’s not that interesting but because I, you know, move around a lot, I travel a lot and I still try to keep in touch with my friends and family back home in New Zealand. With the timezone difference, it’s typical that when I wake up there’s a lot of leftover messages from them. So I usually use the time in the morning to talk to them or to catch up on messages.

BH [13:57]: So outside of work, what aspect of innovation is most interesting to you?

GC [14:02]: So I love innovation in my private life as well. So always interested in what are the latest, you know, apps and products on the market. Always eager to test new things. In my apartment, recently, I have started wiring everything so that I can have a truly smart home. Which is easier said than done funnily enough.

BH [14:21]: As you’re putting together your Smart Home what’s a surprise or something that you really enjoyed or found yourself using a lot more than you thought?

GC [14:21]: I think you have to be very specific with I think a lot of the smart home technology, it’s voice-enabled and I didn’t realize you have to be very specific with you know, different commands. So you know, Alexa, turn off the lamp. You have to specify which lamp and you can’t say it’s a light, it has to be the lamp. So I think the technology still has a few more steps to go. But that’s been one of the small surprises from my smart home experiment.

BH [14:59]: Awesome. Well, that’s it for that segment. Is there anything else we want to discuss?

GC [15:06]: I think one part that I always like to stress with customers and people that I come across when we talk about innovation is that innovation is not technology. And I know I say this, as we talk about, we’re sitting here at the Innovation Center. It’s full of robots and other technologies being exhibited here. But for us, you know, the Innovation Center, it’s really about a platform to change people’s mindsets. To change our company culture, which is oftentimes overlooked.

You can take a robot put it into a warehouse. But at the end of the day, it’s people doing that, people signing off on enabling that. So we also focus a lot on that kind of cultural change and change management. And I always ask our customers and our management to not overlook that part in the process.

BH [15:48]: What have you found to be a successful approach to that? And are there any things you’ve learned as you’ve done change management? And I know you’re showing me the user persona map as well?

GC [16:00]: I mentioned this actually at another panel recently, but when you do these cutting edge innovation projects, I always say, you know, try to get the right people on board. And by that, I don’t mean you know, the management and the CEOs. I mean, also the people that are going to be at the ground level using the technology.

When we do you know, the robotics projects, it’s not with management only It’s also with the guys down on the shop floor. You know, we get their opinion. We have many groups of operations managers and general managers coming through the innovation centers as well.

We make it a very inclusive process and do not have just the top-level aligned to our innovation objectives. But also people on the front line, feeling comfortable with the technology that we’re presenting. And at the end of the day, trying to get them to adopt.

BH [16:48]: Do you ever find that there’s resistance to innovation? And how do you kind of work through that?

GC [16:52]: I think there’s always resistance to the unknown. It’s uncomfortable, right? But what I’ve found actually quite remarkable in the last seven years is there hasn’t been a single innovation project that we’ve brought or introduced to our operations where the people have said they don’t want it.

I think that’s because if you go to operations, a lot of it can be so paper-based. A lot of it can be so manual. You know, it’s very repetitive tasks that these innovations that we’re introducing it makes their lives easier. And hopefully, they see that as well. And I think that’s been the case so far.

BH [17:25]: How do you define success within the innovation projects that you’re working in?

GC [17:31]: I think success is measured in a number of different ways. So one part is, of course, you know, the productivity metrics. At the end of the day, we’re still a logistics company. We need to make sure that we’re delivering on the numbers. One part is BCA, the ROI and all of that, but it’s also a success in terms of other measures.

Can it help us to recruit more effectively? Is it also helping us to retain talent and our workforce more effectively? Is it also generating a change in culture in the operations or within a business unit? So I think, success in terms of innovation is measured quite broadly at DHL.

BH [18:08]: Have you developed any sort of frameworks for defining that or standard processes in which you kind of go through for defining success?

GC [18:17]: Yeah I mean, with the projects and operations there are the standard metrics. Because we are very results-oriented. But then at a higher level, we will talk about the impact of the Innovation Center for the company. We have, you know, our customer satisfaction scores, we have feedback from our customers being measured here. That all ties into one report that our management can see.

BH [18:40]: Now, you mentioned to me a trends report and that sort of thing that you publish. Can you tell me a bit more about reports and things that you guys create and how you stay at the forefront of leading this industry?

GC [18:54]: So the trend reports and our Trend Radar here, I showed it to you briefly. That’s also one thing that we share back to the industry. So I always say one of the big privileges of having these Innovation Centers is that we get to listen to over 15,000 opinions from logistics professionals and from technology professionals. And we distill that into our Logistics Trend Radar, which is actually the second most downloaded document on DHL’s website.

The Trend Radar captures 28 or so different trends that we think will be most relevant to the industry in the next five to 10 years. From the Trend Radar, we take a topic, for example, robotics and automation and produce a trend report. The reason why we do these reports is that being in the logistics industry, you know, you look at our workforce, we’re not full of, technologists, not many of us are developers, we have an engineering background.

For us to get up to speed and digest these new technologies and concepts, these trend reports they’re very kind of bite-sized. It explains you know, what is robotics? What’s happening on the market? How do other companies use robotics? And then what does it really mean for the logistics industry? What are some of the concrete use cases that we can see for robotics and distribution and sorting and last mile?

It’s kind of ideas on paper that gets the discussion going. And we publish these reports publicly for all and our customers really enjoy them. They can read it on a flight home, they get a much better understanding about the topic. They get what it means for their supply chain for the industry. And then they usually use that to have a further discussion with us on one or two use cases that they thought were really interesting and relevant for their operations.

BH [20:34]: So is there anything else you’d like to say to any of your customers, listeners, others and logistics, things we haven’t talked about mentioned?

GC [20:44]: I think yeah, maybe one final point is a lot of the times, you know, customers or even internally at DHL people look to us or look to me and ask me to come up with ideas. And it really takes a kind of partnership approach. And it’s a two-way street, or maybe it’s a multi street with more partners involved, but it really takes a multitude of parties to drive action. So my main message is always you know, it takes two to tango. So, you know, we’re always ready to engage. And I hope that you know, others listening will also like to engage with us.

BH [21:15]: Thanks so much, Gina, this is a pleasure getting to come here to the Innovation Center and talk with you and really talk about innovation within DHL.

GC [21:27]: Pleasure, thank you.

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