They say that it is better not to talk about automation and digitalization in companies. It is such a misused phrase that people's eyes glaze over when they hear it. They don't believe that anything can change or that their company can handle it. Plus, they're afraid... of their jobs or having to learn new tricks. And that they won't. I mean, they're not rocket scientists.
There are a lot of superstitions flying around in the world of digitalization and automation. Jakub Brada from Bramartrans s.r.o. and Qest Solutions s.r.o. encounters them on a daily basis. He is used to fighting them. And win. Otherwise, he wouldn't have been able to build two companies in the last 2 years that are founded just for automation and digitalization of SME companies in vlogistics and beyond. And so I asked James... 🔸 Why can't companies talk about digitalization and automation? 🔸 Should they go digital as they are, or given the corporate strategy? 🔸 How to choose the right data for dashboards? 🔸 What do I need to be aware of before I start digitizing? 🔸 Who typically (dis)supports digitalisation in companies?
HOW TO DEAL WITH THE DISTRUST OF DIGITALISATION OF THE COMPANY? (INTERVIEW TRANSCRIPT)
Martin Hurych
Hello. I'm Martin Hurych and this is Zahžeh. This episode is going to be another in the informal How Far Have They Come series where I invite former guests and try to ask where they've progressed in their business in the last year or two. My guest today is Jakub Beard. Hey, Kuba.
Jakub Brada
Hi, Martin. Thanks for inviting me.
Where does he go when he wants to blow the wind through his hair?
Martin Hurych
You're welcome. Before we get into your journey, I'd like to remind you that Jakub was one of the first three guests here and helped me get the Ignition going, so thanks again for that in retrospect. At the same time, I'm saying that we haven't known each other for very long, yet I missed the fact that you're a biker, so I thought I'd ask where you go when you need to blow the wind through your hair?
Jakub Brada
It's quite easy these days, because when I need to blow the wind through my hair, I take a stroller and I have a slightly different machine for that at the moment. I've been riding motorbikes since I was 13, and then with papers since I was 16, but for the last couple of years I haven't had the time or space to do that because I have two young kids and I'm trying to live that non-business life with my family. So motorcycles have taken a back seat now, but honestly my wife and I talk about it a lot at home, we're looking forward to when the kids are more independent and buy something more travel-friendly. I used to be into a lot of sport bikes, but now I want something more cruiser and we'll start touring Europe.
Martin Hurych
Where would you go if your wife let you go?
Jakub Brada
Anywhere. I think there are a lot of beautiful places in the Czech Republic and all over Europe, so the journey is the destination, that's the case with the bike.
What has Jakub managed to do in two years?
Martin Hurych
So we tell the woman it's time to let James out. As I was saying, you and I smashed ignition together, back when you were building a technological pike in Bramar logistics. When I was getting ready, I tried to write like every other guest on the show, and somehow I couldn't with you. You've come a relatively long way in the time we've seen each other here, so come introduce yourself. What have you accomplished in those 2.5 years?
Jakub Brada
It's been a very quick 2.5 years, during which time we've gone through quite a rapid evolution, getting an investor into the company. We started to scale those logistics routes and processes and we got to somewhere around last year, February, the war in Ukraine, which changed everything. Even though we were growing quite rapidly, we were still quite small to be able to effectively spread the cost of the company across our fleet. We still needed to grow at least threefold at that time to have any competitive relevance. So we were looking at how we were going to deal with that situation because we already had a lot of customers at that time, they were regular customers, nothing had changed in that and we were trying to build those relationships. So, we didn't want to tell them overnight that things were looking bleak and maybe there would be some changes. In the end, we decided to take a slightly different route in terms of logistics, which paid off quite well. When I did a strengths and weaknesses analysis of the company last year, I found that what we are weak in is what I was talking about a moment ago, but what we are very strong in and ahead of the size of our company is processes and digitalisation. We've basically created the entire digital ecosystem of the company on our knees within a very low cost framework. When I then invited various independent consultants, interim managers to the company to help me with that real assessment of the state of the company, they pointed that out. For the volume of work that we do, it usually takes twice or three times as many people in competing firms. So we were thinking about how to turn that into some additional activity and we started to find out among other carriers if that would be a way of some further development of the company. We asked if they would be interested in doing some consulting or even implementing different digital ecosystems that are freely available in the market to help them with the day-to-day operations into their companies. We have found that the interest is great, that it is really something that a lot of companies are dealing with, especially in relation to costs, because it is quite common in transport and logistics that the cost structure is quite large. There is really a significant amount of different documents, invoices from toll providers, fuel, repairs, different leases and so on. So it's not quite easy to break those costs down into the fleet and the views that I need for that management reporting. So that is exactly the route we have taken. We took the help of leading Czech logistics managers, not only those technical managers or directors, but also financial managers, and we put together a methodology for breaking down the actual costs in companies using digital processes. We worked on it for half a year and developed a system that is able to visualize real-time data. Typically
The dispatchers in those companies can then see on a daily basis if their cars are profitable, profitable and exactly how much they are in the black or in the red. That was the way we went through the logistics as such. We found partners with whom we do the logistics on an operational basis. They are larger carriers that we have carefully selected and contracted with to cover all the needs of those customers and we have forwarded those orders to them. We continue to be the contact partner for our customers, but the transport itself is already handled by other larger quality companies.
Martin Hurych
So you're a transport broker today, if I understand correctly.
Jakub Brada
I'm a transport broker and we are also getting more into digital, although we don't need much extensive marketing yet. At the moment the interest is higher than we are able to provide for capacity reasons. So we're trying to build awareness of Bramar as the digital intermediary in this industry.
Martin Hurych
So the next step is some sort of marketplace for transport providers?
Jakub Brada
There may be many potential next steps. Already along the way, we've come up with a lot of ideas that need to be validated so we don't burn money on it unnecessarily, get excited about something overnight, and go down a dead end. So we have some other avenues we'd like to take in the future, but we're staying conservative at the moment. We're trying to scale up the internal team enough to keep everything running smoothly so that we can really be a support for those logistics partners of ours.
Has vlogging managed to build a technological pike?
Martin Hurych
Looking back, you claimed you wanted to build a technological pike in logistics. Albeit perhaps in different ways, did you succeed? Do you see that as a success, where you've taken it in the context of all those external influences?
Jakub Brada
I mentioned in that original podcast that we're creating this innovation environment and so we have people in the company who don't come from logistics. Even though it brings some risks along the way, we try to look at those logistical problems out of the box and that creates that innovative environment for us. That's how I think we've managed to get to that pike goal in logistics, even though it's not on the operational logistics per se. We are able to provide other carriers and logistics providers with a relatively unconventional approach using digitalisation to their operations and I think that makes us very innovative, at least in the Czech market.
Are eStatements a service or a product?
Martin Hurych
Do I understand correctly that you provide this as a service or also as a product that I, as a potential now former competitor of Bramar, can implement in my company?
Jakub Brada
The original idea was purely service-based, however, digitalization as such has been with us for many years, but for many business owners and directors it is still too abstract a concept. However, it's quite hard to sell something intangible, a methodology, a procedure. So at some point we have come to the conclusion that we have to include some kind of output, which we can call the product. That output is a fairly detailed reporting on the state of the company, which we now call eStatements. Of course, we have to get to that reporting by going digital. We can't do it without that, so that it doesn't create more work there, so that those of our clients who want reporting don't have to allocate some of their people's hours just to collect data because of that. So we help ourselves with digitization, automation, that's the background, but at the end of the day we sell that reporting, which is actually that non-traditional view and automated view of that data.
Is combining two different specialisations the way to success?
Martin Hurych
It looks like you've actually combined two things, your former profession as a process consultant and then logistics. Is that something that can be generalized as a way to succeed nowadays, to combine two specializations and invent a market opportunity within it?
Jakub Brada
I don't know, I think it's pretty individual. I didn't plan it that way, it came out of the situation and it was something I wasn't really primarily aiming for. But when it dawned on me that this was the way, it seemed perfectly logical, and I guess it was meant to be.
Why can't companies talk about digitalization and automation?
Martin Hurych
I found an interesting sentence in the preparation. You say that even though you are in digitalisation, automation, that you must not talk about digitalisation, automation. Can you elaborate on that?
Jakub Brada
That is probably due to what I have touched on here, that for many people, even though they have been living with it for some time, for a good few years now, they have been hearing it from the left, from the right, it is such a buzzword, such a dirty word. They imagine sometimes impossible things behind it, sometimes things that would get them more stuck than help them in their daily operations. At the same time, I perceive that digital is still seen as something that only the bigger and richer companies can touch and it's not for everyone. I think that's the thing that should be communicated, that that time has passed, that it's gone. Nowadays, really, digitization can be handled by a freelancer who can help themselves on a daily basis with very cheap digitization, automation, to small, medium and large companies to large corporations that use it a lot. That's the message I've been trying to spread lately, that digitalisation is no longer expensive, it can be done well, safely, but i t has to have certain rules.
Which companies are Jakub's ideal customers for digitalisation?
Martin Hurych
A few people who do automation, digitization, have been through Zah Zah and the range for me is still incredibly wide, from the guy who can click something in Mac to people who are digitizing custom big companies. If you were to put yourself somewhere on that scale, where would we see you?
Jakub Brada
We try to target companies where we think it has a relatively quick and very effective impact. Our target group is somewhere up to 200millionCZK turnover a year and from a people perspective it's maybe around 50 to 100 employees. Typically these are customers who have companies with some history, they didn't quite start their business yesterday and there are some processes in place that are inefficient. When we started to deal with the digitalisation, I naturally started to hear from companies outside the logistics industry. So we work with a lot of companies that are not logistics specialists and help them implement digital systems from single tools that are freely available on the market to large ERP systems. What I meant to say is that those established companies already have a lot of products packed on them today. In fact, almost all of those CEOs have had a call from some department store, offering them some cool product that solved some part of their process. As that has been rolled up over time, or as the heads of those departments have changed, and they've brought in this new tool that they were used to from their previous job, there's quite often a patchwork of sort of disparate tools in those companies. They don't communicate with each other, they don't even communicate with those important processes like accounting typically, there's nothing automated and it's counterproductive. The data has to be exported and uploaded manually from one system to another, and in the worst case scenario, the data has to be manually transcribed. So these are the customers we really help not to use paper, not to transcribe manually and save ideally hours every day.
Leaving logistics and changing business?
Martin Hurych
I always wonder how the tools can communicate with each other if the people don't. You even started a company to do this, which you soon brought under a bigger umbrella. Does that mean you've expanded your portfolio or are you leaving logistics and going somewhere else entirely?
Jakub Brada
I'm definitely not leaving logistics. Our line is uniform, we're still working on digitalization. Bramar is dealing with the digitalization of the pure logistics sector, mostly carriers, and Qest Solutions is dealing with all companies that are outside the logistics market. That said, if I establish a business relationship with a company in logistics or outside of logistics, at the end of the day I don't really care. What's important there is the degree of digitalization and the goal that the company wants to reach. Our process to get there is that we start with a very detailed analysis at the beginning. We try to get to know the company as much as possible, analyze what the company does, how they do it, in what tools, what their KPIs are at the departmental level of individual employees and management, and whether those things correlate. We are trying to ask what the strategic vision of the company is, whether the company is facing an intergenerational change, whether it is facing a divestment in 3, 5, 10 years. Even if this does not happen, these are all pieces of the mosaic that we need to put together and, based on this detailed analysis, we propose the best possible solution for the customer. Basically, we then give some implementation suggestions, usually it's more than one suggestion, it's one, two, three paths that the customer can take. We use various standard tools that are already available on the market. That is, we don't develop and try to go down the path of no-code and low- code applications and some automation algorithms. But the moment we need to develop something tailor-made, that's where the group we have come in handy. It's Qest Port group, where the guys at Qest Technologies, which is a fairly large development hub, are able to help us.
Should they go digital as they are, or given the corporate strategy?
Martin Hurych
I have two biting questions for you. Sometimes I see the following thing happen during automation, digitization. Annie has a problem, so you digitize it for her, and there's not much looking at the fact that if the whole process is straightened out, there may not be the digitized Annie or the physical Annie. This leads me to ask whether to digitize the processes as they are or invest some of it in completely re-digitizing the company and digitizing those processes as they should be in the future.
Jakub Brada
That's a good question to which I don't have a completely straightforward answer because, again, every company is different. I'm not a fan of this kind of transformational change where we've done it somehow until today and today we've gone digital, so we're going to go a completely different way from tomorrow. It brings a lot of risks, it brings a lot of disruption to that corporate atmosphere and some resentment in those teams. I prefer to go down the incremental route, to digitise on the basis of the status quo and get the data. That data is then important to objectively evaluate those bottlenecks in those processes. Most of the time those managers have a subjective sense of where the problem is, but then when we look at the data, we find that that subjective sense is often much less relevant than other problems. It also relates to what I said a moment ago, that we try to talk to all those levels of that company. We always try to look at those sub-projects in the context of that company strategy, those company KPIs. Because the moment I solve a problem for Anna and it costs the company some money, Anna will be happy, but the problem may be completely disconnected from the company strategy. We could have invested that time and those resources in improving, streamlining processes that have a direct impact on the performance of that corporate strategy, those KPIs. But instead, we solved a problem for Anna in a department. So it's always quite challenging work even afterwards in terms of evaluating the design of that solution. We discuss those avenues a lot with those customers and try to design the best possible option so that it has an impact on the whole company.
How to choose the right data for dashboards?
Martin Hurych
Setting KPIs is for a minimum of three additional Ignitions. You said that the most visible manifestation of that digitization, besides of course the labor savings, is the chance to drive the company by data, which is why it's often done. If by data, then also by some dashboards that the data is plotted on. How do I choose the right data so that I actually know what's going on in my company and, conversely, the dashboard doesn't lead me completely astray?
Jakub Brada
Again, I think there are several levels of access. We always look at the reporting that's already in those companies at the beginning. Where is that data coming from, is it being manually entered, is it coming from some system, could we by any chance get it to the people who are supposed to be visualizing and reporting that data faster. That's the first level. The second level is whether the data displayed is all possible, whether the views that the company currently has are sufficient. Often those managers have set up some views that they know for historical reasons, but the moment we bring a data analyst into the company, he's I'm able to turn the imaginary cube with the data on it all the way around. It will offer those companies innovative insights that can often bring that aha moment for those decision makers. They can then say to themselves that those costs are not what they should be and that maybe they're not evaluating it quite effectively. At the same time, quite often we find some competitive advantage in that data. Because we get a kind of thread that runs through the company, and nobody really notices it because it's quite a sophisticated data flow that starts with the purchase of the material and ends with the customer complaint. But that data can be connected, and at the end of the day, when that data is worked with, it can have a competitive advantage for those companies.
Martin Hurych
That's exactly what I was aiming in that direction. Technically I understand how it works, however, I often come across reports where the manager in question asks for the secretary's satisfaction to be plotted against the weather, but that says nothing about the state of the company. On the contrary, it can lead the company astray. So, how to choose the right KPIs, how to select the key points within those processes that really should appear on the dashboard?
Jakub Brada
Most of the time it's some kind of development process. As I said, we first set up what the company has already visualized, and then we look with the company at insights that might be innovative for those managers. We then tune those innovative views to some outcome. Usually that first visualization is not the one that the company goes forward with, but it's kind of a kick-off to changing the mindset of that company. So we look at the data in some regular interaction with that customer to see if those insights are relevant to their time, if there's something that could be added, or if there's too much data. This gradual path of continuous improvement is how we try to reach a result.
What do I need to be aware of before I start digitizing?
Martin Hurych
When I keep thinking about digitalization, automation, I haven't quite decided what I should get in order before I approach someone to come and tidy up my company? What's the basic housekeeping that I need to do before I start spending money to deliver something that potentially may not serve me well?
Jakub Brada
It should be more of a decision maker's setting, if I want to go for it and if so, really give it my all. There's no point in painting the grass green in this business because then the independent third party that comes in won't see the real state of the company. They're going to see something that's been bent a little bit to fit the situation. For me, it's really important that the person who wants to go into this really gets it in his head what the goal is, why he's doing it, and the moment he decides to do it, he gives it his all and pushes the whole company towards that outcome. Because sometimes what happens is that those people, when they are not fully decided, at some point they start to crash the process of change in that company and that's actually the worst thing that can happen. The company has taken a step towards a path, but it's very difficult to follow through because the person who should be the accelerator in the company doesn't have the energy for it anymore and then it's very difficult to do. So at the beginning you have to make a decision in your head and if you decide to do it, then give it your all.
Who typically (dis)supports digitalisation in companies?
Martin Hurych
If you're on the brake and the gas at the same time, you'll always end up bad. Who is the typical pusher of digitalisation in companies?
Jakub Brada
Most of the time in the companies we're in, there's no IT department, or at least it's somehow a shared function, so quite often it's the owner of the company or the CEO. Those are the people who have that mandate to create that environment to help that outcome happen.
Martin Hurych
Where is it the worst?
Jakub Brada
Usually it is the lowest levels, mostly administrative workers, THP. There, it is then necessary to start with some short digital projects that will bring the desired wow effect, so that the person thinks that it makes sense and that it has saved him some work. The moment we go into that gradual change, which consists of several digitalisation projects, it's good to include something at the beginning that doesn't take too long. The people who are scrubbing away at it will see the benefit and gain that confidence for the follow-on stuff, which may already be longer term before it's done.
How does he keep up with all his activities?
Martin Hurych
Now you have two companies, you're part of two companies, you sell a product, and you can find on the web that you're in business for yourself. How do you manage that?
Jakub Brada
I don't run my own business anymore, that was the moment when companies started approaching me about helping with digitization. I did the consultations on my own because I couldn't evaluate the potential right away, so the umbrella entity came later. Today, I have minimal activities on my own, and I am dedicated to those two companies. The good thing is that I don't distract myself, it's still about digitalisation and it's necessary to recognise the goal that digitalisation should lead to and to work towards it. So for me, it's nothing that can't be pursued.
Where will he be in another two years?
Martin Hurych
We're here give or take 2.5 years, where will you be in 2.5 years?
Jakub Brada
I'm heading towards still being in those two firms, that those firms will probably swell a little bit and over time I'll deal with some management levels of my own internal firms. I'd like to focus more on building my companies internally than I am now, where I'm mainly set towards those customers. So I think we will grow steadily and in 2.5 years I would like to be with people.
Martin Hurych
So in 2.5 years you will have two pikelets, one in logistics and one in digitalisation. I wish you well.
Jakub Brada
Thank you.
Martin Hurych
You can see how Jakub managed to more or less change the business from a delivery service to a real technological pike in 2.5 years. If this episode has inspired you in anything, whether it's transforming your own business or looking at digitalization, the decision to automate anything in your company, we've done our job well. If that's really what happened, then lick, shar, comment based on what the platform that you're listening or watching us on allows. Be sure to check out the website, www.martinhurych.com/zazeh, where all the other episodes are in addition to this one, and there will be a bonus that I'll knock out for you from James afterwards. Fingers crossed and best wishes for success, thanks.