Bringing long industry experience to the classroom: interview with Joseph Estrella
For more than three decades, Joseph Estrella held supply chain management positions for major companies. He now brings that experience to bear in the classroom at the University of Rhode Island.
Peter Bradley is an award-winning career journalist with more than three decades of experience in both newspapers and national business magazines. His credentials include seven years as the transportation and supply chain editor at Purchasing Magazine and six years as the chief editor of Logistics Management.
For the past four years, Joseph Estrella has worked full time as a lecturer at the University of Rhode Island (URI), where he teaches operations, global supply chain management, international transportation, and other courses to both undergraduate and graduate students.
He brings to those classes more than 35 years of experience as a logistics and transportation professional. He held management positions for Roadway Express, Staples, and CVS. Before joining URI full time, he taught there part time while serving as director of the transportation and logistics network for CVS.
Estrella recently spoke with Editorial Director Peter Bradley about his industry experience and the supply chain program at URI.
Q: Tell me a little bit about your experience in private industry. A: I have had a terrific career. I worked for what were arguably the three best companies in their respective industries at the time. I worked for Roadway Express for 15 years in roles ranging from dock supervisor and sales representative to posts in operations management and terminal management. For my last six years there, I was the labor relations manager for New England. Roadway was a great place to learn about transportation and logistics, but more importantly, I think, Roadway had a terrific way of teaching you how to deal with people. During my time at Roadway, I certainly learned about honesty, integrity, and ethics.
The next stop in my career was working at Staples, which was a rather young company at the time. I am very proud to say that I was a big part of setting up the distribution process for the catalog division, which at the time was called Staples Direct. That part of the business grew very quickly. In fact, in two years, we went from $28 million in sales to $310 million. I certainly learned a lot about the retail industry working at Staples. I then moved to CVS and worked there for a long time. When I joined CVS, the company had no stores west of the Mississippi, and now, through tremendous acquisition and growth, it is a national and international company.
I was fortunate. I got to work in three really good areas with three really good companies, which serves me well now that I am at the University of Rhode Island.
Q: What made you take the leap from supply chain professional to educator? A: While I was at CVS, we were contacted by URI to work on a distribution project. That was my first interaction with URI. URI then asked me to serve on its Supply Chain Advisory Committee, which is made up of URI faculty and business people in the community. Later, URI asked me to be an adjunct, so I started teaching one course a semester, which I really enjoyed. About four years ago, URI asked if I wanted to teach full time. I think the timing was right for me to retire from private industry and become a part of URI's faculty.
URI is a great institution. The supply chain management (SCM) program started around 2007, and we have already been recognized as having one of the top 25 supply chain programs in the country. The SCM major is actually the fastest-growing major within URI's college of business.
Q: How does your experience in private industry influence what you teach and how you teach? A: At URI, we teach all the different theories and formulas that SCM students need to know and understand, but the fact of the matter is, in the real world of business, it still boils down to people executing their jobs properly. I try to relate real-life experiences to the students with real-world examples. A perfect example is economic order quantity (EOQ). For EOQ to work properly, you want to minimize your holding and ordering costs. You teach students the EOQ formula, you give them a few problems, and they now understand how to determine EOQ. But then I ask them a simple question: If you're working for a large corporation, you may have 40,000 or 50,000 stock-keeping units (SKUs). Do you really think you're going to sit down and go through this formula for 40,000 SKUs every single week? No, you just don't have the time to do it, and that's where software comes into play. That kind of example resonates with students. The idea is that students have to understand the concept, but how you actually use that concept is sometimes vastly different from what is taught.
Q: How do you get students interested in logistics and supply chain management? I don't imagine most kids come out of high school saying "I want to be a logistician." A: Supply chain is not something that's at the top of anyone's list just yet, certainly not when students come out of high school. What we try to do, and we have been pretty successful at it, is explain to students that supply chain is the only discipline that interacts with every other discipline in a corporation. I tell students that when you get into supply chain, you're going to be dealing with procurement, inventory, marketing, advertising, legal, real estate, finance, accounting, logistics, transportation, and distribution as well as with other companies. Then, if students take a course or two, it is not unusual for some of them to change their majors to supply chain.
Q: Do you send your students out into the field at any point in their undergraduate career? A: Yes. We emphasize internships to all our students. In fact, many of our students will do two or three internships at the undergraduate level, and that serves a couple of purposes. One, it obviously exposes students to private industry, and two—and this happens more often than not—students do such a great job at their internships that they receive job offers from those same companies. In fact, many of our students who are graduating in May have already accepted positions with various corporations.
Q: What are the business professionals you talk to looking for in graduates? A: They are looking for, first of all, students with some type of SCM certification. This is an area where URI does an outstanding job, as many of our students will graduate with a CTL [Certified in Transportation and Logistics] certificate from the AST&L [American Society of Transportation and Logistics]. In addition, we have a Lean Six Sigma program, through which many of our students will earn a yellow or even a green belt.
Obviously, technology plays a big role in supply chain management. Business professionals want students who are proficient in programs such as Excel, Access, and simulation software. Our students have done extremely well in the workplace in part because of their knowledge as it relates to technology.
Q: As your students go out the door, what is your advice to them about what they're going to face and what they need to do? A: We teach the same things I'm sure most universities do as it relates to what students will face when they enter the work force—things like the importance of collaboration, knocking down silos, trade-offs, etc. But I also tell students that unfortunately, all of those things don't happen. Many companies will tell you that they collaborate with suppliers, that they are knocking down silos, etc., when in reality, they just don't do it.
I also tell students they need to trust the people they work with. Trust is something that I think is extremely important in business. For instance, if you have suppliers that are cost competitive, that perform well, and that you trust (and that trust you), you now have a terrific business relationship that will benefit all parties. Unfortunately, I think many companies are so cost driven in the short term that they actually spend more dollars in the long run by constantly changing suppliers who don't perform as expected. In addition, by constantly changing suppliers, customer service is impacted in a negative way.
I tell students that if they want to be successful, they really need to understand the business they are in. Listen, really listen; look, really look; and ask some questions.
I also tell them that if they want to be successful, they are going to work more than eight hours a day. Hard work has always served people well. If you do those things and you treat people right, you will be successful.
The one final thing I always preach is to be honest and have integrity. I tell students there is nothing more important than being honest and having integrity.
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."