Ep. 5: From Cameras to Autonomous Drones

David Boardman, the founder & CEO of Stockpile Reports, knows that the foundation of automation and optimization is good data and asset management.

episode 5:

From Cameras to autonomous drones: The evolution of bulk materials management 

with David boardman

David is helping material producers build the foundation - with cameras.

Managing bulk materials is a challenge but the latest technology is giving today's material producers an edge. David discusses the innovative ways his company leverages cameras and drones to provide up-to-the-minute information about bulk materials.

Tune in, or read the transcript below to find out how technology is evolving the way material producers think about and report on their stockpiles (transcript edited for length and clarity). 

Can you introduce yourself and Stockpile Reports?

David: My name is David Boardman, and I'm founder and CEO of Stockpile Reports. At our core, Stockpile Reports is a computer vision company. We had a business before Stockpile Reports doing large scale rapid mapping.

About 10 years ago, we started to look at computer vision technologies and say, “what problems can we solve in the commercial marketplace?” After looking at a lot of really interesting and exciting problems, we ended up going with bulk materials management.

We learned from a company called Knife River, and their president of the Northwest region, Brian Gray, that keeping track of materials was hard. I had no idea! I'd never worn a hard hat, never worn steel-toed boots. I'd always been the advanced technology guy selling to people in shiny buildings, so to get out there and learn about this problem of how hard it is to make bulk materials, move bulk materials, track bulk materials and consume bulk materials, all while keeping track of it -- well, that's a massive problem. 

We honed in on that problem back in about 2012 and I've been going at it ever since. Our vision is allowing customers to get great data on every single stock, no matter where it is in their business operations at any time. There are a lot of innovation opportunities that still need to happen to make that vision a reality.

Asset management and asset tracking are key metrics in the construction industry.

What are some of the associated key pain points that keep your business going strong?

David: Pain points and problems in the industry, that’s what keeps our company going. Asset management is one. With the invention of the barcode, and being able to barcode and use RFID technology, those are both big pieces of technology that came along. 

There's been a lot of optimization, and a lot of process improvement in the world of tracking boxed materials, things that you can put a barcode on. But when it comes to piles of stuff, things you can't stick a barcode on, like rock, there's not a lot of tech. The challenge is that all of those processes and all the software technology, everything that's helped people improve the supply chain up until now, really only supports things that can come in boxes. We have yet to see technology like that in the world of bulk materials. It's really just getting started. 

There is a lot of struggle, a lot of pain, a lot of waste, a lot of frustration, because it's just really hard to keep track of all this stuff. Then we started allowing people to quantify assets and quantify materials (stockpiles) through imagery, at a very low cost. You can just pull your phone out of your pocket or purse, or you can buy one of these cool drones that are $600-$700 right now, to help you track piles. You can also  install cameras -- and we all see how cheap installed cameras are getting. With all of those different, affordable tools, you can start to look to see what material has been dropped off. You can now plug that data into software in the supply chain. 

It's a big opportunity. We're really just getting started on that journey. People started with trying to avoid write-offs, you know, the annual counts they'd have to do on inventories, but now over the last three years, I'd say the shift has been in tracking the supply chain.

Businesses continue to face pressure from end customers who are used to transparency, and knowing exactly when something will arrive, or be finished, down to the minute.

Is that one of the things you’re noticing is a driver for adopting this technology?

David: Yes. The answer is yes. But again, we're just barely getting started, barely getting started because companies are just getting used to the fact that they can have a decent, perpetual inventory in bulk materials. Right? Historically, the error in bulk materials could be high -- there's even some businesses where inventory is 40% off. You can’t provide a service like Amazon or Domino's pizza if you don't know what you have . 

There are salespeople that I've talked to for bulk materials who say they won't sell a short term deal if they don't get in their own truck and drive over and see if the material's really there, because they just don't trust the data in their systems. To start to introduce any sort of automation, you've got to have good data.

Companies are just starting to celebrate the fact that they can get good data to get their perpetual inventories to where they're confident to maybe within five, seven or eight percent, which still sounds crazy. If you were dealing with boxes of television sets, you wouldn't accept that. But with bulk materials, that's a huge accomplishment to get to that number. Now that they're starting to get to that number, they're starting to introduce more and more automation. When you have automation, then you can start to do things like optimizing your supply chain and giving customers great experiences. 

Some customers are starting to experiment with vendor managed inventory models. The first customer we worked with had salt. This company has a challenge because nobody ever orders salt until it's three days before a storm. It's a logistical nightmare. But, if you can start to do like Amazon does and say, “Hey, order your D batteries today --  and if you set them up for auto delivery, every three months, we'll give you 5% off those batteries.” So why can't we do the same thing with bulk materials? You can leave that delivery responsibility to the provider of the material and then they can smooth out the supply chain. With accurate numbers, you can start to create those Amazon like experiences that people know when they order their batteries for their house.

It's great to have millions of rows of data, but how do you turn it into something actionable that a sales or operations team can use?

How does a company move from manual processes to bringing in a new piece of technology to help them?

David: Well, it's a journey for sure. You can look to the world of boxed materials and how supply chain management has evolved and matured. It didn't just happen overnight that Amazon Prime was able to implement all of these operations and strategy. It took 50 years of being able to understand assets and the location of those assets. It starts with having good fleet management software. Then you start to have optimization engines. They come in and understand those assets, understand the delivery capacity, understand the demand of the customer and start to position your supply chain and get them ready to act. This doesn’t happen overnight. It takes 15- 20, or more years. 

I'm a huge believer in focus. Anybody who's met with me and worked with me, it's always about focus. What do we do to win with our customers and how do we accomplish that? Our software platform gives great information about every pile, at any time. That’s it. When we talk to customers about supply chain management, it's with everything we’ve learned from our relationships with our customers in the marketplace. That’s how we know what's happening. You don't just need good data on your stockpiles. You need to have good fleet management, you need to have good optimization software. There's a whole set of boxes on a chart that needs to be filled in right before you can start to implement some of these models. 

A foundational step in the supply chain is what we do at Stockpile Reports. If you don't know your assets, and you don't confidently know where your assets are and how much of it you have, you can't begin to automate and optimize. If you’re wrong, suddenly trucks are going to show up someplace, expecting to load material, and then you just totally blew it. Or you're going to think, “I need to send a load over to the bridge project.” And then you realize they already have more material than they need. And they're wrapping that project up tomorrow, and there's still material on the ground. So now, that was just a wasted trip. You have to maintain really good data. You can't start to do automated dispatch or automated delivery until you've got really good data that you can trust.

Agreed. Good data is the necessary foundation before any automation or optimization can happen, whether it’s in heavy civil construction or bulk materials.

If you’re an industry veteran, you might be able to make good estimates, but if you’re new, how do you make any sense of it without software?

David: At these companies, it is absolutely amazing what they do and how they pull it off. We call it the spreadsheet rodeo. The reality is you've gone from where you're extracting bulk materials or maybe recycling it, to how you're going to transport it by rail barge or ship. Then, you need to know how you're going to get it to an end placement site, whether it’s for a job site, for a civil construction project, for a ready-mix plant, or if it’s asphalt. Whatever it is right now, every step of that process requires phone calls for the most part. Even if there is an automated system in place, I guarantee you, there's still a phone call behind the scenes. People don't trust the system because they know that the data isn't there. 

Often you’ll hear people say “before we load these five train cars to come up to your distribution yard, are you sure you have space for five cars to unload?” They’re still doing that check-in call. They do the same thing for shipping. “Hey, how much quarter-inch rock do you think you can take?” If they’re going to load up a ship and stop at three ports along the coast, they need to get it right. That all happens in phone calls. Phone calls and spreadsheets and whiteboards. It is absolutely amazing people get this stuff done in this way. 

When you are setting expectations with a new customer, what are reasonable things to assume are going to be automated, and what are some of the things that most likely still have a manual component to them?

David: Well, if the goal is on the supply chain side, there are different parts to it. Part of it is understanding the assets that you're moving, which is typically bulk materials. Also, understanding the assets that you have to move the material, whether it's regular trucks, front loaders, feeding trucks, or it's a stacker that has to fill a location. Or, maybe it's a boat that needs to sail or a barge that needs to go down river. It's really about understanding what all of those things are and where they are. 

Companies have to get a handle on that. And there are still companies that are struggling with that to a degree. Moving forward, it's going to take them a while. At the end of the day, it's commitment and dedication to business change. You have to get those assets managed. You have to have a vision for where you want to go with your supply chain. And then you need to know what technology will help you accomplish this in order to keep going forward. It's a long journey. Companies are just putting those point solutions in place, achieving their incremental cost improvement. Companies still have a long way to go to match Amazon or pizza delivery, but they’re absolutely working on it. 

Stockpile Reports announced a partnership with American Robotics -- can you tell us more?

David: Absolutely. I want to be able to help companies manage every pile they have on the planet, and it needs to be so cost-effective and accurate.

We started with humans walking around with cameras or phones, taking pictures of stuff, and then drones became legal and then people could go out and fly a drone over something. But you still have humans involved. And that's great. And it's especially great for valuing your assets. But when you're doing supply chain, you need updates by the minute. Or by the hour, or by the 30 minutes. You need to know the state of your assets. You can't do that with humans, it has to be automated. 

I did some interviews a couple of years ago, and I talked about 2020 being the rise of the machines. COVID came and kind of slowed a lot of that down, but it really is about getting humans out of the loop. We started with installed cameras, looking at the supply chain use case for vendor managed inventory, and installed cameras are great, especially for things like salt sheds or a ready-mix plant. But if you've got a site that has lots of assets distributed over a large geography, to get all those cameras out there, it starts to get expensive. 

As much as we'd like to think cameras are stable, there's always a front loader driver who backs up and bumps into it or something. There is also maintenance involved. We always had the vision for autonomous drones and the industry has been selling the vision of autonomous drones for many years now. There is a lot of of money flowing into the space. There are a lot of announcements of companies saying they do it. But the reality is I've been trying to buy autonomous drones for two years now and I'd call people and they'd say, oh yeah, we're going to do that. And I'd say, great, I'll take a hundred. And then suddenly I get a list of reasons why it's going to be another two years before they can sell me a hundred. 

Finally, I connected with American Robotics and they had received approval from the FAA to do some deployments. I called them and said: I'd like to buy a hundred. They said great, let's get started. And so we've worked over the last four or five months to deeply integrate our products. Now, if Stockpile Reports customers have a site where they need data every hour on stockpiles, they can configure that in our portal, and we can deploy one of the units. We can click a button to schedule it to get data every hour. It just happens. With no humans involved. 

Autonomous drones are super important. Installed cameras are super important too. Eventually it's going to be imagery from cameras on the front loaders and trucks themselves that are feeding us that information on all the assets, visually, every minute of every day. Autonomous drones are a big deal for us. I think it's going to be a really noisy industry over the next few years as the FAA regulations get sorted out. We’ll see investors lineup too. There’s a lot that will happen with autonomous drones over the next couple of years. 

Is there technology on the horizon that you think needs more time before we start to see it incorporated in this industry?

David: I think there is going to be an evolution in this industry. Autonomous drones are just starting, and I would predict that within three years, autonomous drones will be the fastest growing portion of our business.

Right now, it's installed cameras that are growing. I would imagine other types of cameras that move around in space are also going to be big. As more truck manufacturers and equipment manufacturers are embedding cameras into their systems, it's exciting what people are starting to put into a front loader. We can start to tap into that data as well, and we can start understanding assets without deploying any hardware. You already have these assets that are sensing the environment, whether it's through imagery or through lasers. That we're going to be able to tap into, to provide even more frequent data, at even a lower cost. 

We've got at least another 10 or 15 years of major growth and major innovation because man there are a lot of piles on the planet. Nobody knows what's in those piles and on a daily basis, at best, people will be able to tell you algorithmically once a quarter in general, but the future could be every minute of every day.

What's the best way for people to reach out to your team and see if their material production company is going to be a good fit for Stockpile Reports and could get value out of what you offer?

David: There are a couple of ways. The first way is to visit our website, fill out the contact form and the team will get in touch. I'm always open and excited to talk to people too. You can send me a personal email or give me a call. Whatever's easiest for folks.

A few rapid fire questions for you… 

If you could see someone else interviewed on this podcast, who would that be?

David: I would love to see any CEO of any major bulk materials company. I've seen enough technology people talk! I’d love to see anybody who's leading the space and really transforming their supply chain. 

Is there someone in this industry that has been a mentor to you as you've transitioned from the technology space to serving this bulk materials industry?

Is there somebody that's helped you with the learning curve? 

David: There are so many it’s hard to call out. I came to this problem as a computer scientist by training, and a technologist by career. I've learned so much from so many people, but I’d have to say in the beginning, I really appreciated the help from the aggregates associations out there, especially the Washington Aggregates Association. They were really helpful in setting me up with several different company executives to have breakfast and lunch and learn the industry and learn about their problems. That was great. I wouldn't be here if it weren't for Brian Gray, president of the Northwest region for Knife River, saying, “Hey Dave, could you measure a stockpile with an iPhone?” And I said, why would you want to do that? 

I owe it to all of the folks who took the time to share the problems with an industry outsider so that we could be creative to figure out how to solve those problems.

What keeps you in the construction industry, and what about it is exciting?

David: It's two-fold. The first reason is that there is so much opportunity. If you look at the McKinsey reports and you think of the data you see of the digitization of industries, hunting and fishing is the only one below this. So there's just so much opportunity from a business perspective.

What's motivated me more and more over the years is really helping people who don't typically get helped with technology. It sounds corny, but we've helped save busted backs and broken knees and things for walking over all of our stockpiles, trying to measure them. Seeing people be relieved that they don’t have to walk anymore, and thinking of all the time saved, that’s exciting.

There are lots of people that are being asked to attest to the value of their inventory and they've had no good way to do it. They're just doing their best, and they're hoping, and they're going to church and saying their prayers and doing the things that they can do. When we can come in and actually help somebody be more confident about their business, help somebody save some time, help people be safer, I love it because there's other industries where you just don't get that. 

You can see your technology immediately impact people's lives. I always tell my team, there's plenty of places, you can go put mustaches on cats and make a lot more money, but that's just not what drives us.

What's the one piece of technology that you could not complete your job without?

David: That's tough. The piece of technology is the camera. Innovations for cameras are moving so fast. It's so amazing. Every year there are so many more innovations. I don't know that everybody fully understands how much cameras have just been game changing for life and for business.

If there was one part of your job that you could automate, what would that be?

David: Travel planning. Especially with COVID, it's so complex trying to get everywhere. We need to be everywhere, all the time. If I could automate that, I would be a much happier man.