For years, Jon Chesser has been a leader in the use of RFID and other tagging technologies to add unprecedented data to supply chain planning and analytics. Through Jovix, Jon and his team are able to change everything from labor to scheduling to payment through the addition of detailed, up-to-the-minute status of materials from fabrication through shipping to location on laydown yards and more. A fascinating picture of how construction supply chains can evolve.
Hugh Seaton: [00:00:00] Welcome to constructed futures. I'm Hugh Seaton. I'm here with Jon Chesser, chief revenue officer of Jovix. Jon, welcome to the podcast.
Jon Chesser: [00:00:11] Thanks. Thanks for having me.
Hugh Seaton: [00:00:13] So, Jon, let's talk about what Jovix does and then get into how you guys started off and got to where you are. It's an amazing story.
Jon Chesser: [00:00:20] Sure. Thanks for the opportunity. Yeah. So, so Jovix is what we call a material readiness solution. That's a category that we've created. It's all about two things, really it's in construction, making sure that, the worker, the construction crew, they have the right material, at the right time, in the right conditions, so that they're not disrupted.
And then also making sure that the planners, the field engineers the people that are planning the work, have the information about the material flow. You know, according to the work package, according to the schedule, according to the plan you know, we like to say that you know, bad news early is good news.
You know, if you if you know, something's going to happen and you're not going to have some materials and time for a work package, you can at least you could reschedule that and make sure that you don't have a productivity impacting event. So that's kind of what we're all about. Yeah, we got started really as an RFID system using RFID to track material, you know, kind of where is it?
Pretty quickly though, we learned that the real problem wasn't necessarily that people were just losing material. It was more about the paper process all the way through supply chain and all the way through receipt and installation. People were using, you know, disconnected processes, using paper to collect the information, giving it to a coordinator, coordinator takes it, keys it into a system and people don't have access to that system.
So they get reports out of it. They create their own spreadsheets. Everybody's got their own version of the truth. And then that introduces, you know, lack of information and lack of real time information and chaos. So that's really what we do. We approach the, kind of the digital data centric workflow that supports the entire materials management process.
Hugh Seaton: [00:02:04] And when did you guys start this? You've been at it for longer than most, yeah?
Jon Chesser: [00:02:08] Yeah. I mean, really the company was started around 2007, 2008, timeframe. Jovix is a product. We really started developing that and implementing it in 2009. Started off as we call it material visibility portal. And then we actually, then we hired some marketing people and they told us that was a horrible name.
So we rebranded Jovix, which stands for job site visibility extension. And that was kind of the core, you know, there's, there were a lot of, you know, a lot of great systems on the engineering side, a lot of great systems on the procurement side, you know, and then even further down the chain, as far as like project controls and construction management, project management, but there was a gap.
And, you know, once, once someone had designed it and done a takeoff and said, we need to buy it, there was this, you know, once it became physical. No one really had a very good view into that or the data around it until it showed up at a job site. And so that's, that's the niche that we went after and said, "Hey, we think we can, we can solve that problem and, and call it material readiness."
Hugh Seaton: [00:03:14] And it's, it's sort of classic, you know, supply chain visibility, right? I mean, the way you're looking at it is, is connecting that, the part that people worry about the most right.
Jon Chesser: [00:03:26] Yeah, for sure. We'd like to say it's bridging the gap between, you know, procurement, materials management, and construction. And because, you know, it's great to have supply chain visibility, but that supply chain visibility is very powerful, if it's in the context of the construction schedule and plan, and if you can marry those two things up, there's a lot of great analytics that you can get out of that.
Hugh Seaton: [00:03:47] And how do you guys do that? How do you guys marry two pretty different sources of information.
Jon Chesser: [00:03:52] Yeah, for sure. I mean, so, you know, one of the things that we found early on is, and we built into our product is you know, we like to say we're API first.
So interoperability and being able to exchange that data with these systems is key to that. It's not easy. It's difficult. You know, not all systems have a robust API, so there's a lot of things that you have to do to bring that together. But, you know, that's what I've been able to do over the years just to say, Hey, this is the procurement data. This is kind of the supply data. This is the demand data. And then how do you marry those two up and, and, you know, then use really the glue between that is the actual physical tracking of that material. As you know, as it becomes physical and all the way through installation.
Hugh Seaton: [00:04:34] And so how do you guys track physical things right now?
Jon Chesser: [00:04:38] Yeah. So we use a combination of technologies that are out there. Primarily, you know, the, probably the biggest two that we use are barcodes. Barcodes are great. You can use that on a lot of bulk commodities and, you know, things that maybe are not as expensive or pre-engineered. And then on the more expensive pre-engineered side, we're using a technology called passive RFID.
We've used active RFID. We still use it. The difference, the key difference between the two are two things: one active, it has an internal power source. So it has a longer range. Passive does not, it, it has a shorter range. But you know, it's still good enough to work within a people process and technology solution.
You know, there's also a cost difference as well.
Hugh Seaton: [00:05:21] And the way passive would work is somebody waves a wand, or it goes under something or somehow passes near a radio source. Right? And that sort of powers it and it sends, it sends a signal back.
Jon Chesser: [00:05:31] Yeah, for sure. I mean, you know, people use passive RFID all day long, right?
I mean, your access card that you use to get into your building, that's that's passive RFID. So it's essentially, you know, a chip and an antenna that has to come into a field of energy and wants it comes in that field of energy, it reports back.
Hugh Seaton: [00:05:49] Right. So you're basically, they're kind of expensive stickers.
Jon Chesser: [00:05:53] Well, that's a great way to look at it. And it's funny, a lot of the construction guys, we work where they call them stickers, which is fun. Right. But, but that's it right? You use that passive RFID, but they come in all different shapes and forms. We don't make them. We're not a manufacturer, we're the software provider, but we work with whatever the various form, fit, and function that's going to work best in a cold environment, a hot environment, a wet environment, you know, those types of things.
Hugh Seaton: [00:06:17] You told me a really cool story that I, that gave me a lot of understanding of the value of some of what you do you were talking about. And I'm forgetting about , the exact specifics of it, where someone had a it was, I think it was a car factory, right? Where they had a big, massive place where they parked vehicles that needed work and, and they, they realized, Oh my God, I don't know what's where. Can you tell me that story again? Because I think it puts some of these technologies into an interesting perspective.
Jon Chesser: [00:06:44] Yeah, for sure. I mean, and that, that was one of the first implementations we did even before Jovix, you know, our first now we're, you know, I'd probably hear the accent, right. I'm from Alabama. Okay. Yeah, I live in Denver now. I haven't, I haven't shaken it, but it's you know, so yeah, there's Alabama, there were quite a few back in the 2008 timeframe, you know, there 2007, there were a lot of automotive manufacturing facilities that started popping up around the Southeast, really.
So at one of those you know, they had a problem where. You know, when they, when they make these cars, they come off the assembly line. Some percentage of those cars are going to have some type of defect. And so, you know, just for part of their process, they can't fix that defect immediately. So they go and they need to park that into a parking lot before they can actually go and get it later to fix it.
And you know, these parking lots were hundreds of acres. Massive huge. You know, they're building, you know, all the same. They call them completed body units, but you can imagine their minivans or their cars. They maybe all, you know, when they're making them they're, they're all the same color. The only thing that differentiates one from another is the VIN number.
Hugh Seaton: [00:07:52] Which is roughly the size of someone's forefinger under tucked under the, the windshield, right.
Jon Chesser: [00:07:59] Yeah, for sure. I mean, you know, and they, they would, they had tried some things where they had big stickers and things like that, but so essentially they had crews of people that would need to go out and look for these specific VIN numbers.
And, you know, they had a, they had a system. I mean, the system was, Hey, when you take this car, go and park it in this a lot and park it in this row and then this specific space, but it only takes a couple of people not to follow that process for that begin to break down. And so what you had then is you just literally had a system that was completely random.
And so, you know, they said, Hey, can you guys solve this with our RFID? So we went out there, we looked, we found a an active RFID manufacturer that had a system. We, we ended up putting a system in place for them, so that at the end of the day, it was a real-time location system. And now they had a software that they could pull up and it's like punch in the VIN number, and then it would show them the exact GPS location of where that was.
So that kind of was how we got started. Then one of the big utilities based in Alabama, you know, came out and said, Hey, cool thing that you've done there. You know, we've kind of got a similar problem in a construction lay down yard with structural steel. And so we went out there and looked at that, ended up using some different active RFID technology from another manufacturer, but kind of the same problem.
And that was really the beginning of Jovix was, was tracking structural steel.
Hugh Seaton: [00:09:21] And when you say let's think about what that means. So you're, you're tracking massive pieces of steel that are more or less the same size, but they're either punch holes are punched the right way or they're a different different grade of steel, depending on what's going on.
And is it in there where you, where you generally keeping track of it on their site only? Or, or is that where you started saying we're, we're going to be about from, from the minute it, well minute it's cool enough to when it gets put in place.
Jon Chesser: [00:09:50] Yeah. And that's where we started. Right? I mean, it was at the laydown yard, putting the tags on once they came into the lay down yard and recording that GPS location that was the kernel of the application to do that. And you know, the reason that's valuable at least there and, you know, today fast forward to today, we're, you know, now we're, we're pulling data out of systems like Tekla, you know, where the detailing is done, but you know, thinking about it like a Lego kit, right. I mean, you know, these are all very specific pieces that have been fabricated that fit into, you know, based on drawings and ultimately into the entire design. You can't really switch one out for another you know, you've got to have that one right piece in the right sequence.
Hugh Seaton: [00:10:34] That's that's yeah, the, the, you have this image of someone with a mallet saying it'll work. Dammit.
So you, you brought up something really interesting. So that's where you guys, that's kind of the, the genesis of the company. And really from the beginning to where you started thinking about material readiness, at least as a direction, but now you're talking about a much more integrated process. Talk to me a little bit about the, whether it's Tekla or Bentley or somebody, but talk to me about how, how the process integrates from end to end now.
Jon Chesser: [00:11:03] Yeah. I mean, you know what, look, we can stay with that steel example and you know, really can be applied to any type of material and equipment that's on these jobs, but like a good example of steel is the information as it becomes to be detailed, you pull that out of a Tekla model that is consumed into Jovix via our API.
And so as that information comes in, then, you know, on a project you might have one steel fabricator, but in many cases, you know, just due to schedule and risk allocation, you might have three or four different steel fabricators. And so the challenge on the GC side is that that general contractor they've probably got a subcontractor that's doing steel erection. And so, you know, then they need to make sure that things are coming, you know, (A), things are being fabricated in sequence. (B), that things are being shipped in sequence and that's either being installed in sequence. And a lot of these times they don't have a big lay down yard, they don't have a lot of space. So they're trying to be just in time or close to just-in-time as they possibly can. And so being able to take that and kind of put that RFID tag on it and create those packing list and be able to track that all the way and then take that data. You know, big thing in our system is what we call status.
And so status could be, Hey, it's, you know, it's been engineered has been purchased, it's been fabricated, it's been shipped, it's been QA/QC'd, it's been stored, it's been installed. You know, that various thing, take that and feed it back into a visualization tool, you know, like, like a Synchro, some 4D, 5D you know, modeling tool that allows that GC to kind of see, you know, in real time, how are these things coming in? How are they being installed?
And it kind of gives them a check against, you know, just a, a traditional kind of paper or other otherwise reporting system.
Hugh Seaton: [00:12:54] That's amazing. And so when they talk status, do you, does it, is it implied or do you automatically say that, you know, that's some, relation to the schedule, like this is going to be installed and it's supposed to be installed in five days or two weeks or whatever.
Jon Chesser: [00:13:08] Yeah. So for us, you know so we have what we call status rules engine. And so you establish rules that say, you know, so you can audit, you know, you can go in and you can use the mobile app and you can just make a simple update, but we also have the concept and the application of what we call geo-contextual automation.
And so, you know, we're, we'll take, and we have global mapping in the application. And so then we can set up zones and different areas. And so that, I find though that if this tag, which is associated to in this case, you know, a steel piece mark, if that is you know, if it has a GPS location in this specific, you know, latitude longitude, which is associated to a zone and area, then I'm going to automatically change the status.
And so an example of that might be, you know, Hey, look, I've put a tag on this it's at the fabrication facility, it's loaded onto a truck. And then that truck drives by you know, it's loaded into a digital packing list. And then that truck drives by a gate reader at the exit of that facility.
And so. Based on that read and based on that you know, that location of that reader, we're going to change automatically change the status to, in transit of that. Does that make sense?
Hugh Seaton: [00:14:18] It really does. So, so what you're doing is taking snapshots that update, you know, a global picture and, you know, different things are going through gates or they're being wands are being waived or whatever it is to, to collect data at different points.
But you're having to you know constantly or periodically updated, but pretty real-time picture of where all the pieces of, well, that the pieces that are included in your system anyway, are in relation to what's finally going to be built. Is that, does that sound about right?
Jon Chesser: [00:14:47] Yeah, absolutely. I mean, you know, you, you can't, you know, construction is great, but you can't build something if you don't have the materials.
Right. And so those materials have a natural flow and they should have a natural flow, right. Based on how you've scheduled it and how you plan that work. And so all this is doing is applying technology to be able to track that flow and then correlate it to that plan schedule.
Hugh Seaton: [00:15:10] You know, one of the things that I see from very different places in the general technology and construction technology worlds is this idea that that's sensors of different kinds and models for that matter are allowing us to see data at a much higher resolution. And that, that almost automatically means more of it. And more and more often. And this sounds like what you're describing is, is a huge step change in, in data. Right? Cause before it was like, yeah, we have some here. And then they showed up and that's, that was sort of what,
Jon Chesser: [00:15:42] Absolutely, I mean, it was, you know, we like to say we're kind of shining a light, you know, on that material.
It was a gap. I mean, you know, in, in a lot of times, these things just show up at a job site and then you've got to go, you know, a guy goes through the paperwork. And, you know, there's a lot of, we call it, you know, there's a lot of ghost in the machine, right. I mean, you know, if you've got, especially, let's go back to the steel example, you've got these piece part numbers that might be 16 to 20 characters, you know, and they're, I mean, are they really sitting there and reading every single character and matching it to the piece of paper that's on the form, you know - probably not.
Hugh Seaton: [00:16:16] Didn't you mention that they also will often do it in chalk , it's somebody writing on a real job site, which, or whenever, whatever real manufacturing site, so that the likelihood of it being, you know, perfect typing or is, is low.
Jon Chesser: [00:16:28] Yeah. I mean, that was the big thing.
And you know, for us, when we first started this, going back to that initial example, right. You know, I mean, we were, we thought, well, okay, great. People are just losing these things and that's not what's happening. You know, a lot of it is, is in the data quality. So the example that you just gave, you know, in the traditional sense, you're not going to identify that you recorded that incorrectly in the system until you need it to actually install it.
And once you find out at that point, it's too late, because now you're going to have to rework your plan. You're going to have to refabricate at that point, and you're going to have a productivity impacting event.
Hugh Seaton: [00:17:08] It's a really interesting picture, like thinking about suddenly knowing things that you didn't know before, and you don't know why something happened. So it's tough to tell somebody they should do differently or do better or worse. How do you see this impacting the two sides of the equation? The folks that are shipping and the folks that are receiving.
Jon Chesser: [00:17:27] Well, the folks that are receiving for, for one, it, it streamlines that process, right? I mean, it's great if you have a mobile app and you know, let's say you have RFID on there as well, and you've got a, an RFID scanner that's associated to that mobile app. Well, all you have to do is scan one of those tags that comes in and know if it's on a packing list, it's going to bring up an entire packing list on your mobile phone and you can simply just scan the tags and it's going to check everything off on that packing list.
And, you know, if there's an error you know, it will tell you right there. You can also take advantage of the mobile phone so that you can take pictures. Pictures are worth a thousand words. You know, so you've gone on the receiving side. If there's a, if there's any damage. Or something that doesn't look right. You can take pictures. It goes in the cloud immediately. The supplier gets a notification.
And so on the supplier side, and also that makes it more efficient for them. Right? So the biggest issue with suppliers, typically, your fabricators is, you know, a lot of these projects, let's be honest, they're built on the backs of the suppliers and their cashflow.
You know, and so suppliers, you know, a lot of times they get calls from the construction project that says, Hey, you didn't ship this. And they said, no, we did ship it. And then you, now you have, you know, this, all this back and forth and it takes time. And it takes, you know, sometimes days and weeks to resolve that.
Whereas if the supplier can electronically identify everything, they can even take pictures of everything and I can associate a tag and like a picture or take a picture of the load. So all of this is just more digital metadata that allows you to avoid these issues.
Hugh Seaton: [00:19:08] So do you find that it's, it's on the case of the suppliers that they're able to maybe hold less buffer stock, maybe hold, you know, be more efficient in how much material they have on hand.
Jon Chesser: [00:19:19] Yeah. Maybe in the future, we haven't seen that right now, I mean look, you know construction is , a lot of people say they're slow to adopt technology. And, I think one of the main reasons on that is that, the underlying construction industry is based on projects, you know?
And, so projects have a start and an end. And, you know, once a project starts, they're very hesitant to try to implement a new process or technology on that. So getting people to use the technology and the new process . You've really got to time that right. And have the right champions to do it, you know?
Hugh Seaton: [00:19:52] Yeah. Well, the other side of, of just as an aside, the other side of being project-based means you're always late for something.
Jon Chesser: [00:19:57] Yeah, exactly.
Hugh Seaton: [00:19:59] I mean, that's true across different industries, but it's really true in, in construction. So are you seeing on the flip side then, are you seeing that, the way receivers, the way the construction companies are operating has started to change? Are they, are they more, are they able to, to have their schedules a little bit more tight? Are they able to, you know, make you're essentially reducing a meaningful source of risk for them. Has that changed how they, how they do certain things?
Jon Chesser: [00:20:25] Yeah, absolutely. Yeah, I mean, we've got several case studies out there and we've got one, that was in the Middle East, they were able to, they documented, they were able to save about 60,000 man hours. It was a big project, a big refinery project, at the end of the day it's done two things.
One, you know, at least on these receiving crews and on the people on the field, you can do more with less. You know, and not only can you do more with less and oftentimes, and especially in some of your larger projects, things happen, you know, and they're schedule delays for whatever reason. And, you know, typically that fabricator or that supplier, they want to ship as soon as they can, they don't want to hold that inventory.
And so what can happen is, is you may have a schedule delay and you may have allocated so much area to store all this material and equipment that's coming in. And if the supplier is going to keep trying to ship that. You know, you've got to find places to store it. You've got to negotiate something with the supplier, or you got to actually hire more people to start handling the more influx of material that you weren't expecting.
You know, and so what this allows you to do is maintain your, number one, have a smaller staff, but then also maintain that staff regardless of what happens. Because you can keep up with it as you're not processing paper and all that good stuff.
Hugh Seaton: [00:21:42] So there's, I want to dive into that a little bit more just to make sure it's clear that that essentially what you're saying is because you have visibility into what's arriving when, and you can therefore manage some of that. And as they slow down, speed up, whatever you don't have suddenly there's, you know, 10 tons of something all hands on deck to manage this. Right. I know it's coming so we can have two people do it over the course of two days, whatever, whatever it is. But when you have visibility and you can plan it, you don't have big lumpy sort of supply, right? Is it, you can even it out at least as much as possible. I mean, things happen the way they happen, but that's a big deal. Like, like just being able to not have to panic that, Oh my God, we've got to, you know, two trucks of structural steel to use the earlier example.
Jon Chesser: [00:22:26] Again, bad news early as good news, right? I mean, if I, if I know ahead of time, I can, I can make other plans.
Hugh Seaton: [00:22:33] Yeah. How are you seeing, so thinking about how you've been at this for a while, how, how are you seeing things change and how do you, how would you like to see them change? As we, as we, people start doing this more and more, I mean, some percentage of the industry is doing what you're talking about with you and most of them aren't. So how do you see that, that over time changing?
Jon Chesser: [00:22:55] Yeah, well, I think, one of the biggest things that I hope will change is is that, you know, we, we have. You know, we've been implementing this, this digital supply chain concept.
Now we've got 500 or more suppliers, you know, that we've onboarded and have used the system, but that's very much a, you know, we're very much in a stick versus motivation mode right now. So what I mean by that, as you know, when we work with a supplier is because it's been mandated and contractually required from whoever they have a contract with. So that could be the GC, it could be an EPC contractor. It could be an owner-operator depending on that contract structure. And they're told thou shalt do this, right? And you know, this is how they're going to do it. There's there is some value for them.
Like we talked about, like, they've got better access to information, but they're not getting paid earlier. You know, no one's made that leap yet. And so I feel like if the industry could get to the point that says, look, you know, people are doing more of a blockchain now, you know, this is a great addition to blockchain, right?
Because now you have verifiable information about what's been shipped, what's been arrived. And if we can get to the point where people will begin to trust that, right, and they do it on more and more of these projects, then ultimately it can be more of a carrot approach with that supplier to say, Hey, if you follow this process, it's going to get me as a contractor a benefit.
I'm going to give you a benefit by paying you, even if it's like five days early, you know because you shouldn't have to process all that paper. I mean, if things, if you're taking photos and you've tagged it and you record it with the tag and it's all digital and you see everything is good, you should, I should be able to pay that sooner rather than some of these guys are getting paid, you know, 90 days out.
Hugh Seaton: [00:24:40] Yeah. Yeah, that's, that's interesting to think about how much money is being saved in, in manpower and risk and uncertainty just cause you don't have everybody running around grabbing something doesn't mean you haven't paid for them to be there in case it does just knowing that you don't have to have an extra , expensive body around is, is probably worth whatever the difference in, in paying, you know, 10 days earlier or whatever. I mean, the float can't be worth that much, especially in today's world with interest rates. That's that's really cool. What else are you guys, so thinking about your own kind of place in the industry and what you'd like to see kind of happen next?
I mean, we talked about that just now a little bit more, but I'm thinking about, you know, imagine if we have you have the ability to kind of see into supply chains, you know, almost all the way back to the fabricator are you guys are, are, are tying into, you mentioned 4D and 5D before. How are you guys integrating with that?
And, and do you see that as it's already going well, or is that something you're seeing as, as more of a, of an opportunity for the future?
Jon Chesser: [00:25:42] Yeah, no, I think it's, you know, it's, it's still early days on that. I mean, you know, the, the way that we integrate is, is, you know, with the API and making those relationships with the other software providers that are out there to do that. But I think there's a huge opportunity there, right? I mean, people are visual. And so you know, I think that, BIM is obviously a huge component. You know, digital twin is obviously a huge component. You know, people are, are investing more and more into that. And I think for, for those tools, those tools rely on you know, as, as close to real-time as possible and, and valid data.
Hugh Seaton: [00:26:21] And you're talking about a digital twin that from an interesting perspective, often when we think, when I think about digital twins, my mind goes back to, and I've said this on earlier podcasts, my mind goes back to GE where they were, you know, they, they had their engines, you know, flying over the ocean and you could see how they're doing because the sensors were so good, and it was all real-time.
That implies that the thing is finished. But what you're talking about is even before that is a digital twin starts as soon as you've broken ground, really, or as soon as you've created a BIM model and it starts to correlate to something real in the world.
Jon Chesser: [00:26:50] Yeah, I mean, for us, that was the gap that we saw is that, you know, you've got all these great engineering design tools and, you know, BIM and these things are great. But at some point you're going to either procure or contract with someone to produce this physical thing that's represented in the virtual model. Right?
And once it becomes physical, then essentially what we're doing is almost creating a digital twin of each individual component. Then assigning and calculating a status of that as it flows through the material, through the construction process until ultimately it's installed. Right. And then once it's installed, there's your digital twin.
And we're just kind of really bridging that gap with technology.
Hugh Seaton: [00:27:35] It's a really interesting way of thinking about a building where it's, it's almost like water going through roots of a tree, right. Where it's sort of comes together to assemble as, as the building. Very cool, Jon, thank you for, for a really cool vision of, of the supply chain of the present and future.
I appreciate it.
Jon Chesser: [00:27:54] Yeah, thanks. I appreciate the opportunity.