We are pleased to share the first publication in a series of interviews with leaders in the materials handling industry.
Jos De Vuyst, FEM President and CEO of stow details how he began his career in logistics, how the COVID-19 pandemic has transformed the industry and what he sees (and hopes) for the future.
Introduction to Jos & stow
Immediately after my studies, I joined stow which was at the time a small Belgian local racking and manufacturer. stow has been growing in the last 30 years to become a global leader in the supply of industrial racking equipment. Today I am the CEO and also one of the shareholders of the company, along with Blackstone, a US private equity group.
I entered my business life in logistics and will most probably continue to do so, although I was, for some years, the CEO of Kardex during the period that stow belonged to the Swiss logistics group. Until October 2022, I am the president of FEM and am convinced it is important that industry CEO’s take up leading roles in their industry associations.
As we are closely following the development of the logistics market, stow has been developing automated products for our customers. As a consequence, today we are delivering not only racking systems but more and more semi automated warehouse systems both to end users and to integrators. Meanwhile, the automation activities are integrated into a new company called stow Robotics.
We are convinced that we are only at the beginning of warehouse automation as this trend is pushed not only by e-commerce and increasing labour costs, but also by COVID-19. stow will continue the expansion in both racking equipment and automated products, while also growing geographically with activities just beginning in the United States. We have a clear vision on the warehouse of the future, and we will continue to develop new products and automated subsystems for the market.
Biggest challenge for the industry?
There are several big challenges ahead for us. To name a few:
Safety in warehousing is key. Despite the fact that we have FEM guidelines on racking equipment, there is practically no legislation regarding the safe operation of conventional warehouses. For me, coming originally from this business, this is frustrating and should be a huge point of attention for the industry.
The ‘tsunami’ of EU directives and new legislation is overwhelming. FEM and the industry can barely cope with this, and there is a serious risk that this will create a burden on the development, market competitiveness and performance of EU material handling companies in other continents.
In the EU we have a ‘war on talent’ which is not ignorable anymore. It has started to seriously delay the growth and development of EU material handling companies. The need for better and more widely spread education is huge and it might already be too late to address when compared to other continents.
The EU really needs to work on a more industry friendly environment through solving some of the issues mentioned above. The processes for moving forward are too slow.
How has COVID-19 changed the landscape?
COVID-19 has already (and will continue to) reshape our complete economic environment. I see major changes in the flexibility of work, supply chain, drive for further automation and our agility to manage our companies.
In reshaping our working environment, we have suddenly realised that it is more important to manage our teams based on the skills they have, rather than focusing on where the individuals are located physically in relation to the leadership. Online meetings have created a high-speed approach to problems, enabling management to scramble the best teams for each problem in practically no time. Partially working from home will definitely remain in the future.
COVID-19 has also shown us the limitations of the global supply chain. For instance, opportunistic purchasing around the globe will be replaced by more local purchasing and partnerships with SLA’s (Service Level Agreements).
It became clear that personnel issues were the weakest part in the supply chain, with many people being absent and creating disruptions in logistic flows. This will fuel the automation trend in logistics over the coming years. COVID-19 has also created real challenges for the management with more focus on cost variability and agility.
Benefits of adapting to the challenges and changing landscape?
The EU really needs to work on a more industry friendly environment through solving some of the issues mentioned above. The processes for moving forward are too slow. The answer to this question is not easy and we don’t know whether the current landscape will remain or how it will change. For sure flexibility in work and automation trends will increase, despite the fact that globalisation or localisation trends are sometimes very volatile.
I am convinced that they way companies deal with their personnel, post COVID-19, will definitely change. There will be more focus on the well-being of people, on the sense of belonging of people and on the motivation of people. Considering the lack of talent, this will be instrumental. Automation trends will not be stoppable either, not only in the manufacturing or logistics but also in administration.
In the future, people will no longer accept coming to the office to do routine administrative work which they can easily do in a digitalised way from home. I am sure that this crisis will have made good companies even stronger, as long as everybody in the company is open-minded and constantly question what they do. It is important, as management, to instill this creative culture in the company. Meanwhile, most material handling companies are on pre-COVID business levels again, proving the resilience of the companies and the people.
What is coming in the next 5 years for you and your company?
I am excited for the logistic ‘revolution’ we are going through. These changes, although not easy to manage and can present challenges, create giant possibilities for many companies.
Somebody said that 70% of the jobs for the 2030 do not yet exist and if I look to stow, today 40% of our turnover is from products that we didn’t have five years ago. I am convinced that these trends will accelerate over the next five years. Innovation and people fueling our growth is really what should keep up awake.
I truly hope that this ‘revolution’ will, and can, happen in a smooth way. By this I mean without major disruptions such as heavy economic slowdowns and new pandemics. I am an optimist and I think we should all be. Without optimism and without a vision, you can’t create a future for our people, companies and society.
Download the interview.