Outstanding in the Field Podcast

Summary:

Curious about the newly formed National Grain and Feed Digital Solutions (NGFDS) entity and their barge digital transformation project? Listen in as Mike chats with NGFA team members Charlie Delacruz and Mary Hitchcock about what led to the effort, what it means for the grain industry, and what other digital transformation projects we can expect in the future.

What you will learn in this episode:

  • What NGFDS is and why it was created
  • What the new Barge Digital Transformation Platform is and the details/timing around it
  • The projected impact of this newly formed entity and its digital transformation projects on our industry
  • What could be next for NGFDS

Relevant links:

Listen to the podcast:

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Transcription:

Mike:   Well hello, this is Mike Terning. Welcome to another episode of Outstanding in the Field podcasts by Greenstone Systems. Today I am happy to have two guests with me, both from the National Grain and Feed Association. I’ll just say their names and then let them introduce themselves. Charlie Delacruz and Mary Hitchcock. Did I get that right? Mary Hitchcock.

Mary:   Yes, yes.

Mike:   Alright. Mary and I have not met before. So this is good, but Charlie and I have. Charlie and Mary, would you mind introducing yourselves to the audience please?

Mary:   Sure. I’m Mary Hitchcock. I’m director of arbitration and NGFA and also secretary and assistance treasurer for NGFDS, the new entity we’ll be kind of discussing and revealing the project of today. Little bit of background, I grew up in upstate New York. I graduated from Les Moines College in Syracuse, New York with a Bachelor of Science in psychology. That was in 2009. Then I did a bunch of diverse jobs working for a solar company, as a substitute teacher, real estate, pharmaceutical sales rep before landing with NGFA in 2013. Started with NGFA as an administrative assistant, but about a year in an opening came to work with Charlie and the trade rules and arbitration world. So I’ve been working directly with Charlie ever since then.

Mike:   Okay. Do you live in the D.C. area?

Mary:   I do. I do. I’m very close to our office in Crystal City. I’ve been down here for about eight years now.

Mike:  Okay great. Thanks Mary. Does the psychology part of your training help quite a bit with arbitration rule enforcement?

Mary:   Sure, sure. It’s a really good base to have. It’s served me well. I’ll say that.

Mike:   Well, good. Well great. Great to have you Mary.

Mary:   Thank you.

Mike:   Charlie?

Charlie:   It is great to have Mary. I have to admit I was a little worried about her answer to your question about her psychology background given how closely Mary and I work together. Anyways, thanks Mary. Thanks for having us here Mike. Nice to see you again. I am a lifelong Virginian. That’s where I went to school and grew up, including in law school which seems a frighteningly long time ago looking back. Before coming to NGFA, I was in private practice. 10 years with a big law firm and a couple of years with a smaller consulting firm. It’s really my experience on those jobs that kind of lead me to NGFA. That was my experience, my interest in work involving the food supply. Though I have to admit back then I was closer to the manufacturer and consumer side than I am now. I always knew I wanted to go in house. Going in house at NGFA was that it’s one of a kind trade rules and arbitration system.  That’s the work with the trading, contracting, commercial, and dispute resolution aspects of the business in which both Mary and I work at NGFA. That’s really what got us to NGFDS—National Grain and Feed Digital Solutions—and the BTD—Barge Digital Transformation—platform that I suppose we’re going to be talking about today.

Mike:   Well great. So lifelong Virginian. Does that mean that you went to University of Virginia?

Charlie:   Yep. That was University of Virginia for law school. Slightly lesser known college—James Madison University—for my undergrad.

Mike:   Okay. Alright. Well good. Yeah, I’m sure like many listeners they’ve been to Monticello before. Jefferson, he was quite a farmer. He knew how to raise pulses, edible peas. He had all sorts of varieties, I guess. So that’s one of the highlights as I remember visiting Monticello. Yeah, it’s a beautiful part of the country. Well great. Well, again, thanks for joining me today. I appreciate all the work that you do for the industry as part of the National Grain and Feed and the extension with digital solutions. We’re excited to hear more about what’s happening with digital solutions. I know you have a webinar that was hosted back a couple of weeks ago, early August. That’s still available online. That kind of gives a great overview of the Barge Digital Transformation project. For those who have not listened, let’s kind of talk about that Barge Digital Transformation project. Let’s talk about how you got there. So as I understand, it started back in 2018 but maybe there was a little more even leading up to that before 2018. Do you want to give us a little background on that?

Charlie:   Yeah, you’re spot on there Mike. It’s a great question, great way to set it up. I’ll tell you the inspiration and the backdrop for this project really is a great story. For NGFA, we really were introduced to the situation the industry was dealing with and that was in early 2018. For the barge trading industry, those are the folks that transfer the roughly 70,000 to 100,000 bills of lading. Those are the folks out there actually applying our barges. They’ve been dealing with this system now for quite some time. It’s an antiquated system. It’s complicated. It’s expensive. It’s paper based, labor intensive, slow, and tedious. That hard copy document system on which they rely still means paper documents are manually passed through multiple players. Depending on how many people are on a chain, the same document can be overnighted 15 different times to trading parties with everyone in the chain having to get it. Reconsignments can mean days before paperwork is received. By then, that barge is often reassigned again. Companies are spending hundreds of thousands of dollars on delivery charges alone and hundreds of hours are spent on creating bills of lading alone.

That need, that outcry for a digital modern alternative to the process was overwhelming for them to start. NGFA did first hear about that in 2018 when we had representatives from over 40 companies of all types in the trade attend an open meeting in New Orleans. This lead to a massive effort taken on by a special group of NGFA companies. They formed a steering committee and developmental groups. They studied the project, scoped the project, even developed an in house prototype. Then what followed was a rigorous process to select the technology provider out of 15 contenders is what we started with. Then there was development of the platform itself working with the tech provider, of course, and the founding of our new association NGFDA to oversee administration of the platform. That’s really the inspiration in why we ended up here.

Mike:   So at what point did these players kind of say we need someone who represents the whole industry like National Grain and Feed to get involved? What kind of prompted them to get you engaged and involved in the project?

Charlie:  Well, I think that was noted early on that NGFA’s involvement brought special value in terms of being able to bring these folks together to facilitate the communications, to actually help them happen, to be the voice of the group largely. There was a lot of familiarity and comfort between the leading companies involved in this and NGFA since they’re all longstanding NGFA members. Much to their credit, there was a significant interest in wanting to have this platform truly be for the full industry. Not even just for NGFA members, but for the full industry that this wasn’t a project of a platform that was going to be specially designed for those companies in particular or for any companies in particular. The involvement of NGFA and specifically this new affiliate means it’s a non-profit association, which further shows the value and the design of this platform which is to provide these services at a fee, of course, but not with the intent that there be profit for anyone really in this or that any players in the industry are favored one over the other.

Mike:   Well go ahead Mary. Sorry.

Mary: Oh, no. I was just going to say I believe it was Julie Detlefsen back in the New Orleans meeting that Charlie referenced back in 2018 who kind of gave an overview of what the system could do or could be if the industry came together as a group to introduce it and create it. So I think it kind of stemmed from there as well. Julie Detlefsen is also NGFDS’s vice chairman at this point.

Mike:   Okay, interesting. So then were you providing some of the project management type of discipline within the steering committee or was that a different party involved with that?

Mary:   I would say it was NGFA. I don’t know if you could fully say project management. Essentially yes. We were driving bringing them together for the conference calls, at the end of them wrapping up, figuring out what needed to be done next, recapping with them, and setting up the next call, and follow-ups with them. So yeah lightly project management I suppose you could say. I don’t know if you have anything to add Charlie.

Charlie:  No, no. I think that says it well, you know. We had 11 major players involved here. It was a fresh undertaking for all of us. So we all played different roles. I don’t know if NGFA stands out in one particular capacity or not. Certainly, we had the administrative hand in this, but very much an industry run project. We do a lot of things with NGFA. We pride ourselves on being an industry run association, but I’ll tell you. On this project in particular, that really means something.

Mike:   Well, it sounds like there was quite a bit of project management you did. We sometimes call it herding cats, right? It’s difficult to get all of the necessary parties involved to keep things moving in the right direction at times. So thanks for your work there. I’m sure those arbitration skills came in very handy it sounds like. So 11 different players you said. 40 different organizations sounds like have or had a voice into this in one way, shape, or form. What did you or the steering committee find to be one of the most challenging aspects or the largest challenges of the project?

Mary:   Oh that’s a good question.

Charlie: Well, I could jump in on a couple. I think full industry buying was important to the group. We knew we were going to come up with something that satisfied the 11 major players involved. Not that that wasn’t a challenge in and of itself, but we needed something that the full industry was going to embrace. So I don’t know if it’s as much as a challenge in terms of how difficult it was to obtain that because I think we’re there, but it was certainly a challenge that we had to keep that in mind and make it happen at all costs. Then I also had to say on the technological side, even though our tech provider, S-Docs, is great. They were the best fit by far. They’ve already got products that were comparable to what we’re doing. In fact, I think what we’re doing is largely an adaptation of stuff they already had on the shelf. They know what they’re doing. It’s still been a challenge on the technological side to make sure that every part of what we need as we’re applying and wiring and reconsigning will fit in the platform that’s being put together. There has been non-stop testing on this now for several weeks involving a much bigger group that the 10 players and the tech provider. So love to hear what Mary might have to add in terms of challenges.

Mary:   Yeah. I think I would just echo what Charlie said. There’s always challenges when you’re trying to come up with a technological system. Like Charlie had mentioned previously, the steering committee actually—There was a lean team formed early on and we did create our own prototype to help in the backend. To be able to really explain what those 11 players and what would be best for the industry so that way we didn’t have a solution that was tried to be pushed on s. The industry was exactly what they needed. It’s also—There’s just such excitement to of that. I guess if you look at them you could say that there are challenges, but the hesitation of my answer is only that it almost seems as if there hasn’t been just because it’s been such an exciting project all the way through.

Mike:   Yeah, well having a vision like that—full industry scope—is a great vision. I’m sure it had it’s challenges making sure that was enforced throughout the project. The scope for that is often broad. Sometimes there’s a lot of agreement on the 80 to 90%, and then it’s the 10% fringes right that can be a bit of a challenge I’m sure. Well, let’s talk about the project itself a little bit for those who are listening who don’t know anything about it. What documents and processes are being digitized through this Barge Digitization Transformation project?

Mary:   Sure. So the true digitization is of the bill of lading. That’s what the system has made electronic, so it no longer has to be paper based. The system is also a repository for such documents as grade certs or weight certificates, but those are uploaded as PDFs at this point. So the true digital function of this system and the document is the BOL. The other documents are in the system for easy access, easy use, and easy distribution along the string.

Mike:   In its digitization form, there’s also electronic signatures that occur within the platform as well. Is that right? Can you tell us a little bit about how that works?

Mary:   Sure, sure. So since it is within the system, once it gets to a point that a party—the shipper—would request a BOL to be made, a notification goes to the carrier who will—All the information’s already auto populated because it’s in the system already. The carrier issues the BOL, endorses it, passes it on. So it’s all in clicks of buttons that have you accept the BOL and then you endorse it. Then for each company as it goes through the chain, their digital signature and endorsement then gets added into the document. So it is electronic, but it also is where you are able to see a visual of that signature on the paper. So very much like you would see in the paper based world. It’s just in electronic form. It is able, if needed, to be printed. Therefore that’s why you can see the actual signature too.

Mike:   Okay. So you can see multiple signatures of all the parties in the whole chain. Is that true?

Mary:   Yeah. I mean so it’s exactly as you would see if it was passed as paper. So each time—depending on how long that string is, how many parties it’s been applied out to. Each one of them as they get the BOL they will accept it and endorse it and pass it on. So you will see it just compile all the different signatures as it goes.

Mike:   Okay yeah. That’s neat. So in terms of—When did development actually begin in terms of partner selection, partner started writing, S-Doc started writing things for the project? When did that commence?

Mary:   So you can correct me if I’m wrong Charlie, but if I’m remembering correctly we picked S-Docs later 2019. So work did start there as far as partnership and the contracts that are needed to do that type of stuff. Work on the system probably more earnestly began very early 2020, January and stuff like that, and has been continuing since.

Mike:   Okay. Alright. So it sounds like now you’re in the testing phase. How many people are testing it at the moment in terms of this testing phase?

Mary:  I don’t know exactly, but I would say it’s ranged probably from 30 to 50 different people. Again, from the companies that we’ve been talking about and a few others who have joined on. In the beginning it was testing just of the steering committee, which is now the board of NGFDS. Then once the system—That was in the prototype phase. Once they’re actually working in a system where there’s like backend things happening, once that happened we brought in more players because we really wanted it to be tested and thoroughly vetted before we get it out there. Then the other bright side is that the more people that know how to use the system from different companies will really help with training once it’s available.

Mike:   Sure.

Charlie:   Yeah Mike. That testing group is a very broad group. We surveyed the industry. We tried to get everybody multiple times with surveys from S-Docs to see what the interest might be out there from anyone, not just the 10 leading companies. That included a direct invitation to participate in the testing. It’s a fluid group. I think Mary’s right that you’re in the dozens, certainly could be 50 folks out there. They have a weekly call. In fact, it’s later on this morning. Frankly on the technical side, it’s a little over my head at least. Probably not Mary’s. They’re really getting in the weeds on a phase week by week approach in terms of okay we’ve got this. What did people find? They’re actually testing this. They’re actually able to go in there and apply out barges, all hypothetical of course for their own companies and with hypothetical buyers and sellers. So that’s a pretty dynamic process. It’s so far along now that I think a new person involved in that might find themselves a little lost but yeah. It was wide open to everybody. We really want to get as much input and buy-in on this as we can.

Mike:   Okay. How soon do you anticipate the actual roll out into production mode to happen? Do you have a target date for that?

Mary:   Sure. So it’s not necessarily a target day. We are very, very close. We’re in the process of making sure we’re dotting all our I’s and crossing all our T’s. You can find some slow down in that a few times just in trying to make sure it’s right. We’re also mindful of that. We’re getting ready to be in harvest or the busy season. So there’s a few things that we want to make sure are absolutely solid and ready to go before we launch. We’re hopeful that it could be September/October, but we are very, very close.

Mike:   Okay. All right. In terms of that live launch then. Are you planning on having another webinar to announce it to the market?

Mary:   There’s no plans. There’s not one scheduled right now, obviously, but a webinar is a type of what we’ll use to train. We were originally, before COVID, planning on doing kind of in-person trainings, large get togethers, but that obviously has changed. So we switch much more to I’m sure we’ll use webinars at different points in times. Also kind of as I was talking about before, our real kind of secret weapon is going to be what we’re going to call super users. It’s these people who have been training all along and who really understand the system that will be able to help onboard people within their own companies. So there definitely will be webinars, but there’s also materials that will be housed within the system as well so people can read that when they get into it too.

Mike:   Sure. Okay. In terms of this type launch, what’s going to be the scope? Are you limiting bill ladings to a certain waterway or region? Can you explain that?

Charlie:   Right now the system is set to cover southbound flows on the Mississippi River system Mike. That’s what’s applicable to the SF NOLA barge trade. This, of course, includes the Illinois, Ohio, Arkansas, and Mississippi River flows. That’s right now. We can already see in our very near future other directional applications. Going northbound on the Mississippi River system. Certainly, other different river systems, specifically we’re talking about the Columbia and the Snake River systems in the PNW. So that’s our focus, but that’s also what we already see on the horizon. Beyond that, hey I guess the sky’s the limit in this brave new world. I don’t want to get too far ahead of myself, but there has been talk about other transportation modes, certainly other commodities, and even other technologies as they become available.

Mike:   Okay, great. Well that’s interesting. What do you think the impact will be once…Let’s say that we’re talking, again, a year from now. What are you hoping the impact on the industry will be within the next year or two as a result of this project?

Mary:   Sure. Well I think kind of the unforeseen circumstances of COVID, this system is actually a little bit of a silver lining is what’s come out of that is we’ve moved to a much more digital system. So hopefully it helps with ease of use. Before any of that happened, the biggest—There’s really two which is cost and speed. Right out of the gate, companies should notice a savings in cost directly related to what it would have cost them to FedEx those paper BOLs. This system is cheaper than that to do those. Then it comes to speed of it and where you used to have multiple players and people entering information when they get the BOL. It’s entered into this system once. There is a way to correct it if there is an error because obviously you can’t stomp out all errors, but the idea is that it should reduce the rate of errors massively. Then it’s also the speed of which it comes through. So once the grade certificate is uploaded, those who are in the string and should see it have access to it. Same with a weight certificate and all that. So it’s kind of an instantaneous notice of all of this information whereas the old system you used to wait until you received it by paper. So those are two really big benefits right out of the gate. Then I’m sure we’ll learn of more as we go along.

Mike:   Okay. So in terms of those in the industry want to participate, there’ll be some sort of a launch event. How will they register? What will be their registration process to join the platform?

Mary: Sure. So do you want to go Charlie on that?

Charlie:   Go ahead Mary.

Mary:   So at this point we are asking anybody who has any sort of interest, there is a contact form on the NGFDS website which is ngfds.org. So to sign up at this point is to really just let us know that you want to receive information on it. Once the system is live, it will actually be a setup through ESS-Docs in order to use the system. So don’t quite have all the details on that right now, but that’s a little bit of why we’re asking people to sign up through us at this point. So that way we can make sure that everybody is pointed in the right direction and has access to all of the appropriate information.

Mike:   Okay. Is the NGFDS the party who is going to be administering the fees and such for the platform?

Charlie:   Yeah. Part of NGFDS’s responsibilities is to set that fee in coordination with the tech provider of course.

Mike:   Okay.

Charlie:   Right now I think we’re looking at it will be $5 per transaction.

Mary:   Yes.

Charlie:   Specifically they came up with that number as by itself it represents a significant savings compared to just the overnight delivery costs alone. So as Mary mentioned, we expect to see big money savings for the industry right from the get-go.

Mike:   Okay. So are you selling FedEx and UPS short now?

Mary:   We hope they haven’t figured it out yet, right?

Charlie:   You notice I didn’t say the names of those companies. I just said overnight delivery.

Mike:   Okay. Well it certainly sounds like a valid value proposition, right, of $5 per electronic transaction as opposed to the hassle of the FedEx or UPS or overnight delivery service or whatever and that fee. Not having to package everything up and then wait, right? So there’s certainly value too to being able to see the strings and exactly where it’s at in the whole process.

Mary:   Yeah. That was an important part of the system. In keeping with how the trade acts today and the security of the system, you only see the part of the chain that you are allowed to see. So that’s actually a really cool feature of this system as well.

Mike:   Yeah, yeah. That’s great. Well very exciting. I’m excited about the value this is going to bring to the industry and all of the transparency and efficiencies that are going to be created by it. Is there anything you’d like to kind of summarize in conclusion or let our listening audience know further about the Digital Barge Transformation project or National Grain and Feed Digital Solutions overall?

Charlie:   I don’t know that I really have anything Mike. Your questions have been great. I would encourage folks to check us out on our website, ngfds.org. There’s a lot of stuff on there. The webinar that you mentioned is available to everyone. Some other mini tutorial type items are on there as well. Of course, we’re open to questions and inquiries from the industry.

Mike:   Okay. If we have some passionate listeners who want to become more involved with potential upcoming projects, what would be the mechanism for them to get involved?

Charlie:  Good question. Well, they could always reach out to Mary and myself. Our contact information is on that website as well. We’re happy to give it. That’s what we do already for NGFA anyways. We’re always looking for—I think you described them as passionate input providers.

Mary:   Yes.

Mike:   Okay, great. Mary, do you have anything else you’d like to share?

Mary:   No. I think Charlie summed it up very well.

Mike:   Well great. Well, again, Charlie Delacruz and Mary Hitchcock from National Grain and Feed Association and their digital solution arm. I appreciate how you’re seeking to contribute to transforming the industry. So appreciate all your contributions there. Wish you the best and continued safety and health to you and your families.

Charlie:   Same to you Mike. Thanks very much for having us.

Mike:   All right. It was my pleasure.

Mary:   Thanks Mike. Bye.

Mike:   Thank you. All right, bye now.

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