Detours of duty: interview with Dr. Stephen Rutner
In 2009, Dr. Stephen Rutner put his teaching career on hold for his second tour at the Port of Ash Shuaibah in Kuwait. Today, he's back in the classroom with tales from the war zone—in the most literal sense.
Steve Geary is adjunct faculty at the University of Tennessee's Haaslam College of Business and is a lecturer at The Gordon Institute at Tufts University. He is the President of the Supply Chain Visions family of companies, consultancies that work across the government sector. Steve is a contributing editor at DC Velocity, and editor-at-large for CSCMP's Supply Chain Quarterly.
If Dr. Stephen M. Rutner, professor of supply chain management at Georgia Southern University, seems unusually familiar with the ins and outs of moving large international cargo shipments, there's a reason for that. As it happens, Dr. Rutner is also Lt. Col. Rutner, an Army Reserve logistics specialist who has helped move tens of thousands of pieces of military equipment in and out of the Middle East during two tours of duty at a military port in Kuwait.
Rutner originally trained as a tanker, but along the way the Army Reserve discovered that its armor officer had picked up a Ph.D. in logistics and transportation at the University of Tennessee and adjusted its career plan for the "doctor." The rest, as they say, is history.
Rutner recently returned from his second deployment to the Port of Ash Shuaibah, Kuwait, where he served as commander of the 1181st Transportation Terminal and Deployment Distribution Support Battalion. This is the primary military seaport in Southwest Asia supporting our forces in Iraq. He's Airborne qualified, which means he's trained to parachute into a drop zone, and he has earned a Bronze Star. We suspect that his students are afraid to skip class.
Rutner spoke recently with DC VELOCITY Editor at Large Steve Geary about why the Army is involved in running ports, the challenges of moving a 68-ton tank, and what the military can learn from the commercial sector and vice versa.
Q: On behalf of DC VELOCITY and our readers, may we thank you for your service?
A: I appreciate that, but as you go through the airports, please thank all those 18-, 19-, and 20-year-old kids in uniform, not me. They deserve all the pats on the back.
Q: You are both a career academic and a lieutenant colonel in the United States Army Reserves. We all know what a college professor does, but you have now done two tours in Kuwait in an Army uniform working at the military port. Can you give our readers an idea of just what the Army is doing running a port? You think of the Navy when you think of ports. A: This is one of those little skill sets that is critically important to the entire Department of Defense and the Army, but most people don't understand it. There are 12 reserve battalions just like ours, and our mission is to help the warfighter move through the port system to and from the fight. That means we start all the way up at the foxhole helping them come back to the port, moving through the port, and onto the ships, and back to the United States or vice versa. We meet them at the dock and help them get through the process. Since 2004, I guess it is, possibly back into 2003, reserve battalions have been running that process, and we have moved over 750,000 pieces of military equipment in and out of the theater. In any given month, we might move 6,000 or 7,000 pieces of military equipment.
Q: When you talk about 7,000 pieces of military equipment, we're not talking about typewriters and things like that, are we? A: Absolutely not. In my world, a small piece of equipment is a 20-foot container. We move lots of containers for the Army as well as pieces of equipment—an M-1 battle tank, a Bradley tank, all the new high-speed MRAP (mine resistant, ambush-protected) armored vehicles, all the trucks, all the support equipment, the bridges, everything for an Army unit to do its mission.
Q: So when we talk about something like a battle tank, just to give a frame of reference, how much does one of those weigh? A: The M1A1s and A2s that we have seen weigh right around 68 tons. That sounds like a horrific amount of weight, but we are working in an area where we measure things that we load on and off ship in thousands of gross tons. As heavy as an M-1 is, we can probably get 150 of them on one of the big ships if we really need to.
Q: Are military ports a high-volume operation? A: It depends on the port and where you are in the world. Ash Shuaibah, Kuwait, yes. We are by far the highest-volume port in the entire DOD system. Our sister ports, like Beaumont, Texas; Charleston, S.C.; and Jacksonville, Fla., move large amounts, too, but we tend to be the big dog in the process.
Our sister battalions are running places like Aqaba, Jordan. They are doing the same thing on a much smaller scale. Our sister battalion in Bahrain is moving cargo through Karachi [Pakistan, en route to Afghanistan], but they're doing it all with third-party service providers, no military, and they're moving smaller amounts of cargo.
Part of the training, part of the skill set that the Army has given us is the ability to operate in a high-throughput port like Ash Shuaibah or in an unimproved port and do logistics over the shore, which is painfully slow but still a very important skill set if you are going into a third-world country that doesn't have good port facilities.
Q: Given the breadth of the U.S. Army's capabilities for managing the movement of cargo in and out of ports, are there any lessons learned or any insights you can offer to your commercial counterparts? A: I would almost argue the military is learning more lessons from the commercial sector than vice versa. For example, the commercial guys are very good at ship handling, very good at throughput because every hour a ship sits on berth is costing money. Our carriers are just driven on time efficiency. Although time is important to us in the military as well, we have other things that are even more important to us. Where the commercial guys are saying, "Well, you are costing me $10,000 an hour for the ship to sit on berth," the military is going, "Yes, but I've got eight more pieces coming from Iraq that have to go to Kuwait and that will be here at the port tomorrow; those eight have to go with that package to get home so that we create a whole unit move." The learning here is the need to take a deep breath and balance some things. One of the lessons that I think the commercial guys could learn from us is that at the end of the day, it is a dollar business on the commercial side, but sometimes that investment of waiting a few hours and building a little flexibility pays off tenfold down the road.
Q: So the military is taking a look at it from an end-to-end supply chain perspective? A: Absolutely. The commercial carriers that are willing to be flexible and do that, they become the preferred carrier because they are helping the military. Somewhere in Alabama or Georgia, they need that entire package to arrive to keep their system flowing. The carrier is a piece of that supply chain, and when carriers recognize that they are a valuable piece of it, then they become the preferred carrier and all of a sudden, magic things may start happening in their lives. Yes, it could cost them $10,000 here in the port, but if they then become the preferred guy on the list so they get the next bid, which is a $7 million option, it may be worth it six weeks from now.
Q: What important insights are you going to offer to your students at Georgia Southern? A: The biggest lesson I'm going to bring back into the classroom is the need for young lieutenants and captains on the military side and young zone managers in distribution centers or assistant terminal managers in trucking companies who can see the consequences of their decisions. You need people that can think. In a given situation, what do I do? If you do this, what is going to happen? Is it good, is it bad? How did you think through that process to get to that decision?
Q: Is there anything that you would like to add, any point you would like to raise before we wrap this up? A: I am grateful to all of those folks who are over there now and wish them Godspeed. There are going to be times when your readers have the ability to help returning veterans, and I hope companies will continue to be there. I hope all your readers will realize what tremendous logisticians they are. You thanked me in the beginning; let me thank all your readers for helping our guardsmen and reservists go serve and reintegrate back into your companies.
Congestion on U.S. highways is costing the trucking industry big, according to research from the American Transportation Research Institute (ATRI), released today.
The group found that traffic congestion on U.S. highways added $108.8 billion in costs to the trucking industry in 2022, a record high. The information comes from ATRI’s Cost of Congestion study, which is part of the organization’s ongoing highway performance measurement research.
Total hours of congestion fell slightly compared to 2021 due to softening freight market conditions, but the cost of operating a truck increased at a much higher rate, according to the research. As a result, the overall cost of congestion increased by 15% year-over-year—a level equivalent to more than 430,000 commercial truck drivers sitting idle for one work year and an average cost of $7,588 for every registered combination truck.
The analysis also identified metropolitan delays and related impacts, showing that the top 10 most-congested states each experienced added costs of more than $8 billion. That list was led by Texas, at $9.17 billion in added costs; California, at $8.77 billion; and Florida, $8.44 billion. Rounding out the top 10 list were New York, Georgia, New Jersey, Illinois, Pennsylvania, Louisiana, and Tennessee. Combined, the top 10 states account for more than half of the trucking industry’s congestion costs nationwide—52%, according to the research.
The metro areas with the highest congestion costs include New York City, $6.68 billion; Miami, $3.2 billion; and Chicago, $3.14 billion.
ATRI’s analysis also found that the trucking industry wasted more than 6.4 billion gallons of diesel fuel in 2022 due to congestion, resulting in additional fuel costs of $32.1 billion.
ATRI used a combination of data sources, including its truck GPS database and Operational Costs study benchmarks, to calculate the impacts of trucking delays on major U.S. roadways.
There’s a photo from 1971 that John Kent, professor of supply chain management at the University of Arkansas, likes to show. It’s of a shaggy-haired 18-year-old named Glenn Cowan grinning at three-time world table tennis champion Zhuang Zedong, while holding a silk tapestry Zhuang had just given him. Cowan was a member of the U.S. table tennis team who participated in the 1971 World Table Tennis Championships in Nagoya, Japan. Story has it that one morning, he overslept and missed his bus to the tournament and had to hitch a ride with the Chinese national team and met and connected with Zhuang.
Cowan and Zhuang’s interaction led to an invitation for the U.S. team to visit China. At the time, the two countries were just beginning to emerge from a 20-year period of decidedly frosty relations, strict travel bans, and trade restrictions. The highly publicized trip signaled a willingness on both sides to renew relations and launched the term “pingpong diplomacy.”
Kent, who is a senior fellow at the George H. W. Bush Foundation for U.S.-China Relations, believes the photograph is a good reminder that some 50-odd years ago, the economies of the United States and China were not as tightly interwoven as they are today. At the time, the Nixon administration was looking to form closer political and economic ties between the two countries in hopes of reducing chances of future conflict (and to weaken alliances among Communist countries).
The signals coming out of Washington and Beijing are now, of course, much different than they were in the early 1970s. Instead of advocating for better relations, political rhetoric focuses on the need for the U.S. to “decouple” from China. Both Republicans and Democrats have warned that the U.S. economy is too dependent on goods manufactured in China. They see this dependency as a threat to economic strength, American jobs, supply chain resiliency, and national security.
Supply chain professionals, however, know that extricating ourselves from our reliance on Chinese manufacturing is easier said than done. Many pundits push for a “China + 1” strategy, where companies diversify their manufacturing and sourcing options beyond China. But in reality, that “plus one” is often a Chinese company operating in a different country or a non-Chinese manufacturer that is still heavily dependent on material or subcomponents made in China.
This is the problem when supply chain decisions are made on a global scale without input from supply chain professionals. In an article in the Arkansas Democrat-Gazette, Kent argues that, “The discussions on supply chains mainly take place between government officials who typically bring many other competing issues and agendas to the table. Corporate entities—the individuals and companies directly impacted by supply chains—tend to be under-represented in the conversation.”
Kent is a proponent of what he calls “supply chain diplomacy,” where experts from academia and industry from the U.S. and China work collaboratively to create better, more efficient global supply chains. Take, for example, the “Peace Beans” project that Kent is involved with. This project, jointly formed by Zhejiang University and the Bush China Foundation, proposes balancing supply chains by exporting soybeans from Arkansas to tofu producers in China’s Yunnan province, and, in return, importing coffee beans grown in Yunnan to coffee roasters in Arkansas. Kent believes the operation could even use the same transportation equipment.
The benefits of working collaboratively—instead of continuing to build friction in the supply chain through tariffs and adversarial relationships—are numerous, according to Kent and his colleagues. They believe it would be much better if the two major world economies worked together on issues like global inflation, climate change, and artificial intelligence.
And such relations could play a significant role in strengthening world peace, particularly in light of ongoing tensions over Taiwan. Because, as Kent writes, “The 19th-century idea that ‘When goods don’t cross borders, soldiers will’ is as true today as ever. Perhaps more so.”
Hyster-Yale Materials Handling today announced its plans to fulfill the domestic manufacturing requirements of the Build America, Buy America (BABA) Act for certain portions of its lineup of forklift trucks and container handling equipment.
That means the Greenville, North Carolina-based company now plans to expand its existing American manufacturing with a targeted set of high-capacity models, including electric options, that align with the needs of infrastructure projects subject to BABA requirements. The company’s plans include determining the optimal production location in the United States, strategically expanding sourcing agreements to meet local material requirements, and further developing electric power options for high-capacity equipment.
As a part of the 2021 Infrastructure Investment and Jobs Act, the BABA Act aims to increase the use of American-made materials in federally funded infrastructure projects across the U.S., Hyster-Yale says. It was enacted as part of a broader effort to boost domestic manufacturing and economic growth, and mandates that federal dollars allocated to infrastructure – such as roads, bridges, ports and public transit systems – must prioritize materials produced in the USA, including critical items like steel, iron and various construction materials.
Hyster-Yale’s footprint in the U.S. is spread across 10 locations, including three manufacturing facilities.
“Our leadership is fully invested in meeting the needs of businesses that require BABA-compliant material handling solutions,” Tony Salgado, Hyster-Yale’s chief operating officer, said in a release. “We are working to partner with our key domestic suppliers, as well as identifying how best to leverage our own American manufacturing footprint to deliver a competitive solution for our customers and stakeholders. But beyond mere compliance, and in line with the many areas of our business where we are evolving to better support our customers, our commitment remains steadfast. We are dedicated to delivering industry-leading standards in design, durability and performance — qualities that have become synonymous with our brands worldwide and that our customers have come to rely on and expect.”
In a separate move, the U.S. Environmental Protection Agency (EPA) also gave its approval for the state to advance its Heavy-Duty Omnibus Rule, which is crafted to significantly reduce smog-forming nitrogen oxide (NOx) emissions from new heavy-duty, diesel-powered trucks.
Both rules are intended to deliver health benefits to California citizens affected by vehicle pollution, according to the environmental group Earthjustice. If the state gets federal approval for the final steps to become law, the rules mean that cars on the road in California will largely be zero-emissions a generation from now in the 2050s, accounting for the average vehicle lifespan of vehicles with internal combustion engine (ICE) power sold before that 2035 date.
“This might read like checking a bureaucratic box, but EPA’s approval is a critical step forward in protecting our lungs from pollution and our wallets from the expenses of combustion fuels,” Paul Cort, director of Earthjustice’s Right To Zero campaign, said in a release. “The gradual shift in car sales to zero-emissions models will cut smog and household costs while growing California’s clean energy workforce. Cutting truck pollution will help clear our skies of smog. EPA should now approve the remaining authorization requests from California to allow the state to clean its air and protect its residents.”
However, the truck drivers' industry group Owner-Operator Independent Drivers Association (OOIDA) pushed back against the federal decision allowing the Omnibus Low-NOx rule to advance. "The Omnibus Low-NOx waiver for California calls into question the policymaking process under the Biden administration's EPA. Purposefully injecting uncertainty into a $588 billion American industry is bad for our economy and makes no meaningful progress towards purported environmental goals," (OOIDA) President Todd Spencer said in a release. "EPA's credibility outside of radical environmental circles would have been better served by working with regulated industries rather than ramming through last-minute special interest favors. We look forward to working with the Trump administration's EPA in good faith towards achievable environmental outcomes.”
Editor's note:This article was revised on December 18 to add reaction from OOIDA.
A Canadian startup that provides AI-powered logistics solutions has gained $5.5 million in seed funding to support its concept of creating a digital platform for global trade, according to Toronto-based Starboard.
The round was led by Eclipse, with participation from previous backers Garuda Ventures and Everywhere Ventures. The firm says it will use its new backing to expand its engineering team in Toronto and accelerate its AI-driven product development to simplify supply chain complexities.
According to Starboard, the logistics industry is under immense pressure to adapt to the growing complexity of global trade, which has hit recent hurdles such as the strike at U.S. east and gulf coast ports. That situation calls for innovative solutions to streamline operations and reduce costs for operators.
As a potential solution, Starboard offers its flagship product, which it defines as an AI-based transportation management system (TMS) and rate management system that helps mid-sized freight forwarders operate more efficiently and win more business. More broadly, Starboard says it is building the virtual infrastructure for global trade, allowing freight companies to leverage AI and machine learning to optimize operations such as processing shipments in real time, reconciling invoices, and following up on payments.
"This investment is a pivotal step in our mission to unlock the power of AI for our customers," said Sumeet Trehan, Co-Founder and CEO of Starboard. "Global trade has long been plagued by inefficiencies that drive up costs and reduce competitiveness. Our platform is designed to empower SMB freight forwarders—the backbone of more than $20 trillion in global trade and $1 trillion in logistics spend—with the tools they need to thrive in this complex ecosystem."