EP 572: How Surgere and Trane Technologies are Advancing Supply Chain Visibility
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Come see their solutions and meet the Big Joe leadership team, including Martin Boyd, Jason Dunnigan, and Nick Malwecki, March 17th to 20th at ProMat in Chicago, booth N7157. That's booth N7157. The New Warehouse Podcast, hosted by Kevin Lawton, is your source for insights and ideas from the distribution, transportation, and logistics industries.

A new episode every Monday morning brings you the latest from industry experts and thought leaders. And now, here's Kevin. Hey, it's Kevin with the New Warehouse Podcast here at Manifest 2025. And I am in Sir Jair's booth. And I'm going to be joined by Bill Wappler, who is the CEO of Manifest.

Serge Err and also with Dave Grussler at Trane Technologies. And we're going to talk a little bit about both what they do and what their companies are all about so you can learn about that. And then we're also going to talk about how they work together and some of the problems that they're solving within the operations space, within the supply chain overall, and how that can benefit you, the listener, right? So Bill, Dave, welcome. How are you both? Hi, Kevin. Welcome.

Thank you. Thanks for having me. I'm in your booth, so I will be welcomed. Yeah. Thank you very much. Thank you very much. And how is the show going for both of you guys? It's day one here. For us, it's maybe the most exciting show of the year. Yeah. And the reason is, is that Manifest is traditionally very forward-looking. Right. So your listeners who may be thinking about technology in a warehouse environment, they

could come here and they're going to see, of course, robotics and a lot of things that you're interested in, but they're also going to be engaged in conversation around what does that future look like and where's technology going and how are we going to look at the future?

It's here. Yeah. Yeah. And what's your perspective? Yeah. As a user of the technology, this is a place where we're actually trying to look at what's coming next. One of the things that we're focusing on in my area is trying to develop standards and set the vision of what we want to do from a manufacturing perspective going forward. And so this really gives us a lot of good insight on what's next and how we can now adjust our vision accordingly.

Got it. All right. Interesting. A lot of vision, a lot of forward looking. I like that. Definitely. And that makes sense, right? It's manifest the future of logistics and supply chain, right? Is what they say. Definitely getting and getting those vibes for sure. Now tell us about what you guys do for people that maybe are not familiar. Bill, you want to start off here? Sure. Serger is very unique.

Although we are an IoT technology company. Yeah. And we use technologies that most of your users and listeners would be pretty familiar with, whether it's passive or active RFID, Bluetooth, UWB, all those buzzwords are in our toolbox. But we're...

a lot different than a traditional technology company in that our approach is really all about creating

super intelligent assets. So whether or not that is a case on the shelf or a part or whatever it might be that's flowing throughout a supply chain, as it enters a warehouse, we've been gathering intelligence about that asset throughout the beginning of its life.

So now someone that's in the warehouse can not only see what's there, what's come in, what's left, but they can also get a sense of where has it been, right? What have the environmental conditions been?

have been during its journey. Okay. All of those types of attributes now come along with that intelligence. And so we look at IoT technology a little bit upside down. Most of the folks that bring it into a warehouse environment, whether they're supporting Red Prairie or Blue Yonder, whoever it might be, you know, a number of

What they're doing is they're typically looking at ways to use technology to support those environments, right? How do I help make sure of what's on the shelf? How do I make sure what came in? How do I make sure what went out?

Certainly important data points. Yeah, absolutely. But the fact of the matter is, if you knew the attributes around all of those assets from the time that they were born till the time that they leave the warehouse environment, it just makes that data so much richer.

And really, I think that's part of our future. Yeah. It isn't just what's in the warehouse. It's where did it come from and what has its life then. Yeah. Yeah. And I think when you get that enhanced kind of visibility and that understanding through the lifetime, you certainly can...

view maybe a little more predictable or understand why certain things happened or how to plan a little better too. No doubt about it because then FIFO has a different kind of a connotation, right? Yeah. And so does the potential of recall. Well, where are those assets and which ones are of particular interest? There's all of those pieces that make up what's actually in a warehouse. Mm-hmm.

that we bring with us. Interesting. Interesting. Okay. And Dave, what do you guys do over at Trane? Yes. So at Trane Technologies, we're a climate innovation solutions provider. We're a global company. We basically are manufacturing HVAC, heating, ventilation, air conditioning systems for a variety of different areas, commercial, residential, as well as transportation, and also now health sciences as well.

So we are really looking at ways to create the right climates for the right environment for the people or the products that are being stored or shipped in those locations around the world. Interesting. And certainly I've seen your stuff around pretty ubiquitous in the space. So now tell us a little bit about maybe the right way to go about this, right? Because you guys are working together, obviously, right? So maybe, Dave, why don't you tell us from your perspective, what was the...

the challenge or maybe the problem you were facing that led you to Serger? So yeah, about a year and a half, two years ago is really when we started to really try to investigate Serger.

what technologies are available to solve some of the problems that we were facing. And really, the problem that we were trying to face at the time is really simple. We just didn't know where our products or our components were, and we weren't able to ensure that they were getting to the right place at the right time. And so we had a number of solutions that we had tried implementing in our plants, and a lot of those were just not successful, to be very honest. Yeah.

So we really needed to find a better solution that had better reliability, providing us the data that we needed. At that time, we went out, we did an analysis, a competitive review on what was available. And that's really what led us to here, to be very honest, and that we were really looking for a partnership. And that was also something that was really important to us. And I spent 27 years in the automotive industry before coming to train technologies.

And in automotive, it's very common to have partnerships with suppliers. And in general industry, which is where train really falls, it's not as common, to be honest. And so we were really looking to try and start to

to creating that culture of having partnerships. And a lot of the companies that we actually talked to when we were looking at trying to find the right partner, they just weren't in the space to be a partner, to be very honest. They wanted to work through distributors or other channels or partners that really didn't meet our needs. And one of the things that was unique with Surgir is they were agnostic to hardware. So they could work with us to develop an application or a solution that they would

They would help us to find the right hardware, pair it with their right software, and then give us the actual solution for our application that we needed. And we have a lot of different applications that we're trying to fill solutions in. And that was also really important to us. We needed somebody that had the breadth and the depth to fill all of those different spaces. Very interesting there. And so, Bill, tell us about, I guess, when you heard this problem, right? How did you go about addressing it and building a solution for it?

So, Kevin, if I may, just for a second. You may. Thank you. I think there's an important point that we don't want to let pass. Okay. If you pay attention to Deloitte, as an example, they would let you know that about 43% of programs and projects, just like David was mentioning, fail. Think about that. You're about a coin flip away from success or failure.

That's pretty high. That is incredibly high, particularly when you think about the investments that need to be made. Oh, yeah. So the question for us was relative to train, how do we ensure success? We have to do that. And train made it very easy because the unique part about train is that they started with a very high level of executive commitment.

And it didn't just stop when the POs were signed. There's a continuous flow of executives within our meetings. They are participants, right? Yeah. They know where they want to go and they're part of the team. Incredibly important.

The second piece of the success is really all about governance. So when we're working on a project, we are not independent. Yeah. We are literally, and David and his team have said, we're really a team, one team. And that really allows us both to understand fully what they're looking for.

which allows us to architect and design the solutions. And then we put metrics together, right? That allow us to judge, how are we doing? Do we need to go through another iteration? What does it take to get us toward their definition of success or, if you will, perfection? Yeah. That is a uncommon, if not totally unique thing.

characteristic of a lot of other companies that we work for. As you know, Serger works for some of the largest companies in the world. Yeah. They're right there in front of you. I see some pretty impressive brands here. Not bad, right? You're doing good, Bill. Thank you. Yeah, thanks. And so it really starts with those two primary factors. They have to be elements.

And then really the next piece of it is as our architects and things come in to design that technological footprint, it has to work within the environment, their processes, how they do business. All of that has to be a very cohesive solution. So far, we have started day one and it is working perfectly.

excellently. Yeah, yeah. Would you say the same? I agree. Okay, all right, good. Well, the way we judge ourselves is are we providing them

at an accuracy level of around 99.9%. And that's differentiated data, which means I don't put everything in their house in a microwave, superheat it, and then I know what's there, right? We have to understand not only just superheat it, but we literally are working within, I need to know some data

something that's going to create data 18 inches from something else. And so it's a very complex environment to work in, which you and all of your listeners are very well aware of. Yeah, definitely some complexity. There is complexity. And together, that's what we built. We built a solution around that complexity. Interesting. Okay. Isn't it? Yeah, definitely. And so, Dave, tell us about

the contrast from the problems you were having before to now with the solution in place, how has that improved operations? How has that made a change in the business? Sure, absolutely. A good example of an area where we were really struggling, to be honest, previously was we had our finished goods. We would take them out into our yard and we would have literally hundreds of products out in the yard. And

We would take sometimes hours or days to find the products when they were actually ready to ship to the customer. The products all look very similar to each other, but...

What we were able to do is develop a solution together in which we now have pinpoint accuracy of where every unit is located out in our shipping yard. And these are large units. Think of a shed or a small house in some cases. So it's not something small. They're large.

But the ability now to pinpoint within minutes, literally, of where it's at and ensure we're getting the right product on the right truck shipping to the right customer has been a huge, huge efficiency improvement for us. And it was a low-cost solution that we've implemented together. And we're actually now starting to spread to other locations as well within Ukraine to implement the same technological solution.

And that's really what we were looking for in a partner. We had some unique problems that we needed to find solutions for that didn't exist, to be honest. And we needed a partner that would work together with us to do some brainstorming and then put some technology behind...

a solution to implement it, it gives us the data that we needed so that we could become more efficient. Yeah, yeah. And I think it's very interesting because you said they're large units, right, in some cases. And some people might be like, well, how could you not be able to find them? They're so large, right? But it's very easy in that sense to lose something or lose track of something when you have a lot of units moving through or products or components, whatever the case may be.

You know, one easy misplace is takes you a couple seconds to do what then, as you said, could take you a couple of days to then find it. Right. So tell us a little bit about how you assessed that situation. We'll be back after a quick break.

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Well, first of all, I would say that it's hard to imagine a field, very large commercial air conditioning products. Yeah. A large field of them that all look alike. Yeah. However, they are all built to a custom spec. So in many cases...

You're not going to send one. You're sending maybe three or four. They are a team that are going to work together, right? Well, if there aren't four spaces when they're taken from production to put away out in the field, then you have three over here and one there.

somewhere else. It's kind of like looking for one in the state of Delaware, to be honest with you. Kevin, it is crazy to even imagine it. So when we first arrived, what we knew is that there was not a single technology that was going to answer this question. We've seen before where people have placed GPS units

on different products. Okay. And then we've also seen how over the years, those GPS units get sent with the products or they end up being in a box next to a door somewhere. Right. The process starts to fall apart. And so, however, GPS is actually a really good technology, basic technology,

To use in that environment, we just didn't want to deploy something we knew was going to fail. So we married passive RFID and GPS together into a single unit. And what happens is that they have a golf cart that is literally driving through these fields.

energizing the passive RFID that we then incorporate that data into a GPS unit, right? A reader looks a little bit like a tablet, only it's GPS. We have then marked that entire state of Delaware so that wherever it's reading it, we now know what that GPS unit is. So when they go to pick something else up to get ready to ship,

They just list the component and where it's supposed to go. And then we show that on a map up to a GPS point location. And it's,

To be honest with you, it's very sexy because what you're really doing is saying, just show me where it is. And you see four docks on a map and it's right on top of what you got to go pick up. And it's always available for you. So now they send a crane to pick it up and put it on a flatbed with maybe three or four people so that they can load it up.

And then just to make sure that it's right, as they're driving through the gate, we check the GPS and the RFID tag one more time. Yeah. So we error proof it.

Interesting. How cool is that? Yeah, I love that kind of like double confirmation. Yeah. That's really, really great. So I'm curious there too, because you mentioned somebody just out there looking for this, right? And they all kind of look the same as you said there, which makes it even a little harder, right? So how has the employee experience changed with this technology coming into play?

Well, from an employee perspective, it makes their lives significantly easier. Literally, we would have a team of people out in the field searching and searching for hours, sometimes days, literally, trying to find things. So it was...

obviously not a pleasant experience for them as they're trying to locate something. The truck is sitting there waiting to ship and they can't find the product to put on it. So if they're under a lot of stress, under a lot of pressure to try and find these units to get onto the trucks and to ship them on time,

So now it's a completely different experience for the employees, obviously. They punch in, as Bill mentioned, on the computer where it's at. It shows up on the screen exactly where it is. They can then immediately go and pick it up and get it on the right truck and shipping it to the right customer. And in fact, we've had experiences in the past...

And hence the double-checking piece of it, where we've actually shipped the wrong units to the wrong customer. And then we've had to turn it around, bring the truck back. So from a sustainability perspective, from a timing perspective, obviously we're tilling our efficiencies in that space. And the double-check wasn't the essential piece, really, of what we wanted to deploy to ensure that it was on the right truck at the right time at the right place. So think of that field as a warehouse. Yes.

Right. You can collapse that same kind of a theory into four walls. Yeah. Right. Particularly if we have a client that does flexible put away. Okay. They lose about $9 million worth of product a year.

Yeah, I can see that. Now it's an automotive client. Yeah. And they move 600 trucks in and out a day of product, right? So you can understand the scale of what a moving product looks like in a warehouse. But the whole point is if you don't know where things are, then you send out teams of people to see it. Then if you can't ever find it, a lot of times QA will reject it from going to the line anywhere. Yeah.

So there's this whole now confrontation of how to catch up with the velocity of business inside a warehouse. And it all is the same conversation that we have with train, even though those are large sitting on a field the size of Delaware. Yeah. It's actually, Kevin, if you think about it, isn't it the same darn thing? I mean, where is it? Yeah. Where is it?

Make sure I get the right thing and then check me to airproof me when it goes to the line or when it goes out the door or whatever it is. We have Toyota up here in front of you. Re-airproof, as an example, what they put on a truck from a warehouse going to dealers that will be used for a repair part, right? Yeah.

So how long do you want to wait for the wrong repair part? Right. You and I would not be happy if they say, oh, we're going to have it fixed by Tuesday. But then because the wrong part came, it became Thursday. Yeah. It actually challenges their brand.

And so it's critically important, just like it is a train, to make sure whatever the part is, whatever the finished good is, you know where it is, you can access it quickly, then you can error-proof the fact that it's left. Yeah, yeah, and I think that's a great way to look at it because...

When you look at even just a traditional four wall warehouse, even the yard outside is technically another extension of the warehouse. You got items in trailers, containers, that's storage, and that's inventory you need to track as well. I can definitely see how that translates over.

Very interesting to talk to you both here and learn about how you've come together to solve this problem. And it's always interesting to get the perspective of the end user and see how the solution has provided that benefit and address some of those challenges. So tell us, you know, you've gotten this solution in place. And now what does the evolution of this solution look like for you at Trane?

Yeah, so I tell my team, really, this is the year of execution for our team. The last year, year and a half, we were really in the process of developing our standards, defining our vision, defining the strategy on how to achieve the vision, and then beginning to work with partners like Bill and his team here at Surgir, and trying to really develop that plan and start to implement some of those solutions into our facilities.

We have a large number of additional facilities that we're moving into this year as we expand out. We have roughly 40 manufacturing facilities around the globe that train technologies. And we have a large number to get into yet as we continue to expand into the rest of our facilities. Really, this is the year of execution where we're now taking the solutions, putting them into the action, and actually utilizing them so they can start to reap the benefits, reap the rewards.

from the efficiencies that come from that. So that's a big piece of where we're at this year and looking forward over the next couple of years is getting these solutions rolled out. But in addition to that, as we continue to go and we continue to talk to each of our facilities, we learn more about some of the pain points that they're having and new opportunities that it actually brings into that space

For example, maybe kitting, for example, and tracking the location of kitting from one area of the plant to the point of use on the assembly line or tracking the actual assembly of the units through the line, maybe adding quality into that as we track it going forward in the future. So there's a significant number of additional things that we will continue to expand into as we get our foundation in place.

And then we get a good understanding on what the principles are. And then we can then expand out into a significant number of opportunity areas that just continue to give us the right data at the right time and the right place. Yeah. If you could imagine...

The backlog of business they have is incredible because of the number of data centers that are going in. Right. Right? Oh, the cooling. Oh, think about that. Okay. And so their business is exploding. Yeah. Not only do they have that that's really increasing their velocity of business, but of course they have other commercial business that they've been doing forever. And they're incredible folks, right? Right.

Right. However, the backlog is so big that it isn't just warehousing that you solve. You have to figure out how you can meet the velocity of business that's being demanded of you. So one of the things that we're doing is we're following product down the line and we can help them start to recognize areas that they can increase throughput. Right.

How do we move product faster? How do we move people faster? How do we make fewer mistakes on the line? All of those things then can accelerate business. It accelerates what goes into the warehouse or Delaware.

All of that moves faster and faster. And frankly, you can only do that with data. Yeah. I must say that something that I really look forward to personally engaging David and his team with is AI because we are currently, Kevin, we are projecting about 15 billion transactions a mother currently. Wow. Right? That's a lot.

It's a lot. Yeah. And our users, here's what's happening. Our users are ingesting so much data that it's overwhelming to a human. They can't synthesize it. They can't analyze it. They can't act on it in a high velocity environment. So as we've now developed our agentic AI solution,

It is going to come to David, and as they're dealing with all of the new velocity of data requirements they have, we'll lay over an AI solution that will capture the data and then feed them with the results of, here's what I see, here's what you should do, and here are the priorities of activities. And so we're looking forward to...

I'm looking forward to working with them because they're the perfect customer for that. They're always out looking to do better. AI can give them the ability then to deal with data at a larger, faster scale. Interesting. Well, that'd be cool. Definitely. How do you feel about that, Eric?

Yeah, the future is ripe for helping us to become much more efficient. And then you've got roughly an $8 billion backlog in orders right now that we're trying to find ways to become more efficient, to try to get those orders out the door faster. So things like automations,

automation, efficiencies, eliminating mistakes. Those are all a part of the puzzle in helping us to do that. And being able to sift through the data more quickly and more efficiently is really what our operations team need in order to make sure that they're getting the data they need to make the right decisions to get that product out the door as fast as we can. And it's a big challenge. It really is. It is a big challenge. But it's also a big opportunity, I think. Yeah.

$8 billion backlog. Must be a nice position to be in. Oh, my gosh. Yeah. Okay.

I'll go with just one billion backlog for me. That's good enough. Yeah. Yeah. Yeah. So great to talk to you both here and really interesting to learn about, you know, the project and how you're working together and what the future might look like, too, and how that continues to to evolve and get some perspective on really how the Surge Air solution can really help people get better track of where everything is and have that better quality as well, which at the end of the day,

is going to drive that further customer satisfaction, which the supply chain basically exists to do. So great talking to you both here. And if we wanted to learn more about Surge Air, what's the best way to do that? Well, we have named our AI Sophie.

So Sophia is the Latin goddess of wisdom. Yeah. They can always reach out to Sophia. Okay. It's on our website. All right. And it's sirjair.com. And anybody that wants to get to know Sophia, she's waiting. All right. She's waiting. All right, Sophia, we're coming for you. There you go. And Dave, if anybody wants to add to your $8 billion backlog, what's the best way to learn more about terrain?

TrainTechnologies.com is our website. And we have one of the largest service and sales networks out of any HVAC company. So we've got people all over the country willing to work with you to come up with customer solutions. All right. Great. And fantastic to talk to you both here and really appreciate the time. And we'll see you next time.

Hope you guys enjoy the rest of the show. Thank you so much. Kevin, it is always good to sit with you. This is our second year in a row now. I know. It's an annual tradition, right? It is now a tradition. There we go. And welcome to our booth. And enjoy Vegas while you're here. All right, I will. And I look forward to talking to you again. It's always been a compelling conversation. Thank you. Definitely. Thank you.

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