IAM Robotics: Tom Galluzzo

IndustrialSage

Tom Galluzzo, CTO of IAM Robotics, returns to share how the industry has changed since the first months of the pandemic.

Danny:

– Well hello and welcome to today’s Executive Series on IndustrialSage. I’m Danny Gonzales, and today I’ve got a very special guest. I have the chief technology officer Tom Galluzzo of IAM Robotics. Tom, thank you so much for joining me today on the Executive Series.

Tom:

– Danny, thanks for having me. Always a pleasure.

Danny:

– Well this is your second time. I think we talked, oh I don’t know, a year ago or so. I think it was post-Covid. It was after MODEX maybe, I think.

Tom:

– Yeah, it was right there in the middle of Covid. I think it was after lockdown started, yeah.

Danny:

– Yeah, it’s just Covid time. Was it BC, AC, whatever. Time has been confounded. Well a lot has happened since then, since we had spoken. And we’re going to get into that in a little bit. But first for those who aren’t familiar with IAM Robotics, tell me a little bit about who you guys are, what you guys do.

Tom:

– Yeah, absolutely. IAM Robotics, we are a warehouse automation company. We make autonomous robots to do any sort of material movements, transport around the warehouse. Our claim to fame is, we’re the first company that’s really commercialized what we call AMMRs, which is autonomous mobile manipulation robots. It’s a mouthful, but basically it means robot arms that can drive around that also have—it’s a driven robot platform that also has an arm on it. The robot’s able to see things and look around and find things, pick them up off the shelf for order fulfillment, so fulfilling products for ecommerce and that kind of stuff.

Danny:

– Excellent. That’s awesome. Since we spoke last time, I think we thought it was just March, April-ish of 2020, things were freshly, “Hey, you know, what’s going on, and how long is this going to be? It’s only going to be two weeks, right?” How has your business changed since then?

Tom:

– Yeah, good question. We’ve deployed our first scale deployment of our Swift AMMRs. We’re doing a deployment right now with a company called A.S. Watson in the Netherlands, so about half of their products are going to be picked with our robots. It’s really cool. We’re starting to ramp up the number of items that the robots are picking. It’s kind of an industry first. It’s the first time that we’ve seen mobile robots that have the ability to drive around and pick products actually do it autonomously. What we’re doing now is, we’re expanding our market reach. I would say what we’re doing with Swift is a very specific niche market of piece-picking long-tail items in inventory. What we’re doing is we’re expanding our market reach by taking the base platform of Swift, and we’re commercializing it into a product that we call Bolt. So Bolt is really a general AMR, autonomous mobile robot, and we have some really cool, unique features that hopefully you and I will get a chance to talk about here. But really starting to see some–– a lot of the traction and take-off in the market around AMRs and being able to do various things on top of a mobile robot that has that ability to drive around and navigate by itself.

Danny:

– Absolutely. So you were mentioning—maybe I missed it there—that first customer that you said in the Netherlands where you’re rolling out with this. What space are they in?

Tom:

– Yeah, they’re kind of like a CVS, Walgreens kind of company. They do pharmaceuticals, health and beauty items, cosmetics, that kind of stuff. So they have many different brands that they have across Europe and Asia. And they’re doing a lot of online order fulfillments, a lot of online direct-to-consumer business for all that health and beauty market space.

Danny:

– Oh, okay. Excellent. That makes sense. So do they have any retail locations as well, or is it all more like online?

Tom:

– They do, yeah.

Danny:

– Oh okay, so a mix.

Tom:

– They do. Yep, all across Europe and Asia.

Danny:

– Okay, well yeah, that seems to be the story and the theme as we continue on with this. Looking at these different changes, I know you said you rolled out with some new products. How has Covid really altered your future or at least maybe the way that you look at it?

Tom:

– Yeah, there’s a couple of different things, and we talked about this a little bit when I was first on the show. Basically there’s kind of the demand side and the supply side. The supply side is really, it’s just harder for folks doing order fulfillment, the companies out there that are trying to ship direct to consumers to find the people that they need and be able to keep up with the growing online demand. We have some of the data on this now, so with Covid, the ecommerce industry which had normally been growing at about this 15% a year, year over year growth, in 2020 spiked by I think 39%. So it went from a 15 year-over-year growth rate to, in 2020, there was that spike because everyone had to order things, almost 40% growth.

Danny:

– That’s huge.

Tom:

– We don’t think a lot of that’s going to come back. So the demand side is that everyone’s just buying—it kind of accelerated the consumer behavior to buy more things online. And so you take the supply side—it’s hard to find people to do this work—and the demand side going up, autonomous robots or automation are really what’s required to fill the gap for people trying to do that.

Danny:

– Well certainly we’ve had a lot of challenges, obviously, with the supply chain, but also you mentioned labor, labor being a really huge story and a big piece of what’s happening. But if I heard you correctly, you said you guys aren’t anticipating that demand is coming down. It’s going up. It was already going up, but with Covid, boom, it just ignited it even more.

Tom:

– Completely. I think that the future of work is forever changed now with the way that we’re buying goods online, but also just the kinds of work that people are interested in doing. I think it’s a universal challenge in anything manual work, so it could be manufacturing. It doesn’t have to be supply chain. It could be manufacturing, anything where people will previously just use the object movers and employ in basic manual tasks. We’re seeing a more educated workforce globally now because consumers are just more educated around how to use technology, apps, cell phones, computers. The younger generations don’t want to go in. They’re just not growing up with that mentality of, oh, I’m going to go work at my dad’s factory someday. That’s just not how it works now. The way it works now is, I’m going to learn how to use these apps. I’m going to go drive for Uber, or I’m going to go work in some other data thing. Or maybe I’m just going to work on making websites and mobile apps myself. That’s where everything is headed. You’re just seeing this generational shift from manual work to electronic work.

Danny:

– Absolutely. Getting your crystal ball out for a second, you’ve already prognosticated a little bit here.

Tom:

– It’s a dangerous thing to do.

Danny:

– I know it is. That’s okay; it’s all right. We’ll explore the dangerous side of this. What do you think the future of the industry looks like?

Tom:

– Yeah, really good question. I think generally speaking we’re going to see people doing more supervisory tasks, a lot of sophisticated automation within warehousing, supply chain, and ecommerce. We’re seeing a lot of deployment of what’s called goods-to-person systems now, so companies like AutoStore, Dematic, Intelligrated, they have lots of goods-to-person systems, shovel systems, mobile robot systems. There is a company that Amazon of course acquired years and years ago called Kiva Systems, which is basically mobile robots bringing shelving over to people. There’s a whole bunch of companies doing that kind of stuff now too that are bringing those solutions to market.

Generally speaking, walking is going to be completely out, so people walking around the warehouse is just a thing of the past. It’s totally a waste of time and money for employers to spend on moving, people travelling from location to location. It’s all about having the automation solutions bring goods to a person. And we’re seeing more bringing of goods to the robots. Companies like RightHand Robotics, Berkshire Grey, they have these robot automation systems where the goods are coming out of an AS/RS out of the storage machine, brought to the robots, and the robots are doing some of the work to pick it. And really it takes a ton of people to supervise that, make sure the data’s all correct. Soon you’re going to see a lot of those higher-value tasks being done, a lot of the menial, just moving things around and picking items, those tasks are going away, and those are going to automation.

Danny:

– Yeah, it’s super interesting because I remember the first time going into—this is years and years and years ago, but going into a warehouse that was pretty automated, bringing in conveyor systems. Now there were no robotics because that was still, I felt pretty far out. Maybe Amazon was starting to roll out with it a little bit, maybe. But still just seeing some of that automation, and you’re looking at a warehouse. It wasn’t massive, but that had a million SKUs and just how you would pick orders was like, wow. You’re going down with a shopping cart and just putting stuff in like you’re going to Walmart, except we’re doing it here. Just seeing the ridiculous increase in efficiency by being able to process and pick a ridiculous amount more orders per hour is crazy. I remember walking in and just being like, whoa. This is crazy. This is nuts.

Tom:

– It’s huge. The scale is massive, and that’s only one distribution center. Of course the number of distribution centers is growing exponentially as well. There’s still so much concrete being poured to grow this industry. But you’re right, and your point about conveyor, I think conveyor is slowly going to trickle out of the industry as well in favor of more flexible, autonomous mobile robots. We’re starting to see some of that. So there’s certain sweet spots where, if the conveyors are long enough and the throughput is low enough, that it actually makes more sense to have a robot transport those goods from location to location in the warehouse instead of installing this big, long conveyor that’s not really going to get a big return on investment.

Danny:

– Yeah, that makes a lot of sense, yeah.

Tom:

– As we see the price of robots come down, we’re going to see more and more of that.

Danny:

– Yeah, I can see that. That’s for sure. It’s been interesting to see some of these different solutions that are replacing that. Certainly the flexibility piece is huge. It’s a big capital expense, and then if you’ve got stuff bolted to the floor, it’s hard to unbolt it and move it and reconfigure it and whatnot. Yeah, it’ll be interesting to see the future on that. So let me ask you this quick other question, another magical question if you will. If I were to give you a magic wand—I said here you go, take this magic wand—what would you use that to see to change in the industry? I will give you one caveat: it can’t be, “Get rid of Covid”. It’s got to be something outside of that.

Tom:

– That’s an interesting one. What would I like to see change? Nothing is immediately coming to mind, but I do think I would like to see more innovation in general, just people thinking out of the box about how you take some of the technologies that are out there today and deploy them in unique, creative ways. We’ve seen blueprint concepts for having, for instance, mobile robots replace sorter systems where you have mobile robots being able to pick up items in one part of the facility and shuttle them around in a sortation process or something like that. There’s so many things you can do with the technology today that still aren’t being done. There’s just an incredible amount of white space out there for being able to do more interesting things with person-to-goods solutions, being able to do more with robots combined with pick-to-light, that kind of stuff that we think could be really interesting for a broader set of folks in the market. The challenges associated with that are the industry is more looking for the product to be fully commercialized before we could just go and blank-check innovate. I think that would be the magic wand thing, if there was one thing we could do or if we could get some more of the R&D dollars to be able to try some of these models that we’ve toyed with on paper before. They could be really interesting for solving some really unique challenges in the space.

Danny:

– So note to the CFOs: increase budget for R&D. Okay, noted. Got that. That’s awesome. One thing I wanted to ask, and I didn’t. We didn’t preface this ahead of time, but I just thought I’d bring it up. I’m curious. Sometime within the last year—you’re CTO now. How has that… because when we talked originally I think you were CEO or president or something. Talk to me about that transition. What has that been like for you because I know recently we heard Vecna Robotics, same sort of thing with Daniel Theobald over there. I know he’s excited to focus on more product development and get into that. What has that been like for you?

Tom:

– That’s my background is technology, so for me personally it’s been a huge help to have someone else help carry the business and leadership. We got Lance Vandenbrook who’s fantastic. He was previously at Kiva Systems. He led their international sales and marketing. So he has a ton of experience in the space. He also worked with some other companies in robotics, so he has experience playing the CEO role before. So just being able to help manage the business, some of the executive recruiting, growing the scale, it allows me to really focus more on what I like which is evangelizing the technology, figuring out what the bigger strategic roadmaps are technologically and so forth, and providing more of that leadership to the technical organization here at IAM Robotics. I’ve made that switch before where I was CEO, CTO.

When we were doing fundraising for our Series A round, there was a point where it was so much of a full-time job that I couldn’t both run the business internally and do the technology deployment that I had to do and go do the fundraising. I thought, I’m probably going to be better suited finding someone that’s more likely to have a million sales calls and talk to a bunch of investors. So we brought on a CEO for that portion, and it ended up working out well. We found our Series A investor, and then eventually I was able to step back into the CEO role, and then, now it’s at a point where we’re ready to scale, and I’m happy to have Lance take over the business end of things. It’s a double-edged sword. There’s an upside and a downside to being the CEO, and not having to do the downside stuff for me is where it’s helpful.

Danny:

– Well absolutely. Like you mentioned, it is a full-time job trying to raise, and then you’re constantly talking to investors. It’s just like, hey, we have other stuff that we want to do over here. Yeah, totally get that. Well congratulations on that, to be able to focus on those great pieces to keep things moving and growing and doing that thing that we talked about, innovation. Wrapping up a little bit, what are you doing as a leader, as CTO, leader of your organization, what are you doing to really stay on top of your game?

Tom:

– Yeah, that’s a really good question. I think you have to have some component of fun and tinker with technology to keep your head into it, I think. When you reach a certain level, you’re not really able to write code anymore. You’re not able to design algorithms and do any of the detailed hardware design or anything like that. You’re really just providing a top-level framework and architectured process. I think for me, I don’t ever want to lose sight of my drive to actually understand and actually build. And I have this innate kind of—I don’t know, what we’d call a grain of sand to the pearl in the oyster—just itching to always build and do things and learn new technologies. Just as a hobby I started tinkering around with my kids teaching them to program video games

Danny:

– Wow, that’s cool.

Tom:

– As an example. We’ve just been having a blast with that just as a hobby on the side, just showing my kids. For me it was an opportunity to get to learn how to program into a game engine. It’s inspiring. It makes you think through, oh man, if we could program robots this way, it would just totally change the game of how we got work done and how efficient we could be with—I’m not saying we’re doing anything like that yet, but it’s really helpful to just drive the creative process. Always get back to your roots and be able to tinker and have a hobby and learn the new tech.

Danny:

– Absolutely, and I love that you’re doing that, especially with your kids to bring them into that. That’s such a great skill for them. It’s interesting; it reminds me. I remember a story—this was years ago—where, I believe McDonalds was, a lot of their training modules they were using–this was several years ago, so they were programming everything and creating video games, basically, on the Nintendo DS. As an employee in Japan, if you were working at a McDonalds, you would go through all the training material on a game, basically, because they were realizing that, hey, with the culture, we love video games. Let’s do that. What’s interesting in industry is there’s a company called Forklift Simulators and we’ve done some work with them. They’re all training on forklift driving using VR technology.

Tom:

– I’ve seen that. It’s super cool. They use virtual reality, and it feels pretty realistic, too. I’ve tried that at some of the trade shows. I think there’s an aspect of that too, if you can get your engineers in the mindset of gamifying their own work. I think that’s one of the things as a CTO I want to explore going forward is starting to not think about work so much as, oh, there’s this list of tasks and stuff I’ve got to get done in my sprint but thinking about how you can get creative and figure out unique ways that you can change the code to make it better, ways that you can—a lot of times we get bogged down with something called technical debt which is where you program something initially one way, but it really wasn’t best for the future. I think I want to get a mindset in the culture around changing some of the software over time so that you can gamify the process of making it better as you go. You’re not just adding things to something. You’re polishing that stone and continuing to revise it and change it and tweak it. There’s a fun aspect of that because you’re trying to figure out unique ways to leverage your time to be able to modify what you have and make it more efficient.

Danny:

– Absolutely. I love it. I think this opens up; it goes back to this innovation piece. Just tinkering and exploring and, like you said, looking at all these different creative solutions that might help make that product better or create a new product that solves the challenge. It’s fantastic. We’re running up on our time here, but for those who would like to learn more about you guys, they can go to iamrobotics.com. Is that correct? I want to make sure I got that right.

Tom:

– That’s it.

Danny:

– Alright, they can do that.

Tom:

– I-A-M robotics.com, that’s it.

Danny:

– Awesome. Well Tom, listen, thank you so much for spending some time with me today on the Executive Series. It’s always great talking with you, and I hope that—we’ll do it again. We’ll have to do this; we’ll do another catch-up.

Tom:

– Absolutely.

Danny:

– Alright, great. Well that wraps up today’s IndustrialSage Executive Series with IAM Robotics, the chief technology officer Tom Galluzzo. If you’d like to learn more about them, you can go to I-A-M, iamrobotics.com.

Listen, if you’re not on our email list, I highly encourage you to go to IndustrialSage.com right now if you’re not there, if you’re maybe listening on a podcast, and go subscribe because you’re missing out on great content like this so that you can learn from your peers, and you can see what things are going on and maybe expand some of your creativity as we understand what other people are doing and different solutions. So that’s all I got for you. Thanks for watching, and I’ll be back next week with another episode on IndustrialSage.

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