Tom Bianculli, Zebra Technologies | theCUBE + NYSE Wired: NRF Media Week - AI Retail Leaders

It's great to be here, John. Thanks for having me.

Absolutely. So we love talking about AI as it applies to retail, so you're in the middle of it with Zebra Technologies. You guys, I know you got some news, but I want to get your take on just explain what Zebra does for the door. You've seen our devices, you may not have noticed the logo, but it's been there. So we have market share leading positions in all the mobile computers that are deployed across 80% of Fortune 500 companies. That includes retailers, transportation companies, manufacturing companies, warehouses, hospital wristbands and patient side medication administration. That's using our devices to really digitize and automate workflows. So if you think about capturing information, that could be information about inventory on a shelf, scanners, scanning technology that reads barcodes, that prints those barcodes, that captures that data on mobile computers for applications to be able to consume them for doing things like inventory optimization. And then we have a whole suite of software capabilities that help optimize those frontline workers. And really the way we provide the care to a patient, we want to use the technology to remove all that extraneous activity, allow them to get their job done. We do that through asset visibility, mobile computing, and intelligent automation.

Oh yeah. We actually pioneered wearable technology in the enterprise with some of the largest transportation carriers. The first wearable computers that mounted on wrist, we have scanners that read barcodes that literally the size of a ring that you can wear on your finger. And so if you think about a large carrier like a FedEx or UPS, when they're loading the back of those vehicles, they're scanning every package going in using that kind of technology. And we pioneered that. And now we're seeing a whole new generation of it with generative AI and computer vision and AI that we're really excited about. And the company is not a startup, it's been around for a while. Over 50 years.

Absolutely, those are all great points. And even just to flesh it out a little bit further and go back to the behavior, I think one of the other dynamics on the demand side we're seeing from our customers, showcased in a major way at NRF over the last couple of days, is the labor shortage and labor attrition, wage inflation. And so Korn Ferry is actually estimating that by the end of the decade there'll be a shortage of 85 million workers, which is like the population of Germany, and they're anticipating that's going to result in $8 trillion of unrealized economic output. So everything you just said, which is that technology is now possible, what's possible has advanced massively, and what's valuable is being able to augment workers to be able to deal with the fact that there is this labor shortage. And we're asking frontline workers to do more and more. So if you think about what's on the floor at NRF, what are we hearing from our customers? Think about a store now, it's not just a physical store to go... In terms of the technology, what's realizable now and possible? Absolutely, computer vision is at an inflection point in terms of what can be run on that far edge. So we demoed in the booth with Qualcomm, with Google, and with a major North American retailer the ability to literally snap a picture of a shelf and within a second be able to see, identify all 70 products on that shelf, identify what the products are, are they the right products, is anything in the wrong location, is anything out of stock. And then to the agentic point of what you mentioned earlier, the system then ingests all of that captured data and using generative AI decides what are the right next things to do. Should I kick off a task to have someone replenish an item, but don't do that if it's not in the back stock, otherwise you're just wasting somebody's time. Or should I say, hey, there is...

Absolutely. So in the logistics space, we're definitely seeing e-commerce fulfillment centers. This is orchestrating robots with people in an environment. And we're taking, if you think about the time or the amount of mileage that a picker in a warehouse environment walks per day without this robotics, they might walk 12 or 15 miles a day. And with this robotics capability, that's down to one or two miles. They're focused on the actual picking and fulfillment.

Yeah, what I would say is a common thread across all those areas is this need to have perpetual asset visibility. So wanting to understand, and you know, a lot of the omniverse capability, digital twin, some of these concepts have been around for a while, but now it's really hitting a point where it's able to drive a return on investment. And so asset visibility is really around where are all my people, my inventory, my capital assets. But not just understanding that from a planning perspective, but understanding in real time, in motion, where are those assets. That's one key piece. The other piece is what Gartner calls the time to competency by 50% for onboarding new employees. And these are the kinds of trends: the asset visibility and making that more perpetual and continuous, the everyone connected workforce that has the right information and the next best action at their fingertips, and then the ability to human-centered automation. I think there's so much in the headlines around wholesale automation, and it's going to be critical. Exactly. The robot will fill the gap on some labor issues. My coffee might be filled by a robot, but a latte is a latte, you know, whatever. But the humans, the next product, yeah, exactly. And so being able to do that in a much more collaborative fashion with automation. So I would say those three elements: perpetual visibility, the connected frontline worker with this information, and then the collaborative automation.

Simplified a little bit, but visible, connected, and optimized. That's what you guys are doing.

No, no, I think the great insights around that, I think the, and we're both saying the concept's been around for a little while, we're seeing a... About on-shelf inventory availability or inventory accuracy for fulfillment from store. One way to look at it is say digital twin is, I'm going to have a digital representation of the entire store at every second of every day. That could be energy management, it could be inventory. If you take it from a digital twin perspective, it's the people, it's where the vehicles are coming in the back to make deliveries. Or you could say, hey, the use case is that 50% of when shoppers leave a store without buying something, more than 50% of the time it's because they couldn't find what they wanted on the shelf. A really basic thing. Or when you made a promise to deliver something to your house tomorrow and I sent a picker in the store to go pick that item and they can't find it on the shelf, you're a disappointed customer. So if we said, hey, what if we digitally... We have customers doing this today. They're getting that perpetual visibility of the inventory and they have basically a digital twin of all the inventory that's then solving for, hey, I'm never out of stock, I never make a disappointed customer because I always can find what I'm looking for when I do the pick. And so it's a digital twin with a purpose. It's a digital twin to optimize why the thing exists in the first place. Exactly right. And then what we're seeing, John, really is once you stitch together multiple of these use cases, you get to the whole store becomes digitally twinned because it's an amalgamation of a number of these use cases. And I think that's the way to do it in an economically realistic way, as opposed to just digital twin for digital twin's sake.

Sure. I mean, obviously Gemini Pro has been getting great reviews. They got a lot of big queries, a great product. They got a lot of great big iron capability. Absolutely. Yeah. So the exciting thing about the Google relationship, and really unique with Zebra and Qualcomm as well, but with Google specifically, we use Google's Android operating system, which is obviously independent of the Google Cloud platform, on all our mobile computers. And we have a market share leading position, the number one position in enterprise mobile computers across all the verticals you mentioned. But then in addition to that relationship with Google Cloud Platform and GCP, we've been on a journey with them for the last six or seven years. And we essentially had no SaaS offerings if I go back six or seven years ago as a company. And now we're enabling with a whole suite of what we call Workcloud offerings. It's a whole suite of communication, collaboration, employee self-service for doing things like... Worker that helps them get their job done, again, removes the extraneous noise and helps them focus on what's the most important thing in the moment. And all of that, as we brought that in through organic development and acquisitions, and it's been multiple acquisitions to kind of get to where we are, we went on that journey with Google Cloud to migrate and basically shift and harmonize all of that into a cloud instance that allows us to minimize duplicity and have a common data lake and do that in a really effective and efficient way possible. All the metering, we partner with them on Apigee for API integration so we can do metering and observability. Got security challenges too, absolutely. And leveraging Google in terms of being able to get that from a security wrapper perspective is tremendous as well. So all of that on the tech side. But the other thing I really... Layer and bring Google in as a platform as a service. And so going on that change journey is not simple either, right? You've got people that have been developing certain ways for a long time. And to bring Google in and go on that transformation with them was just as valuable as all the technology. And as I always like to say, people do business with people at the end of the day. And they're just tremendously a great culture and people to work with.

Yeah, so the couple of key takeaways. One is this Zebra Companion offering that we announced at the show. We showcased in the booth with some of the players that I just mentioned. And there's four key agents under that. So keep in mind, these are... Bought it with, but you don't have the receipt. What do you do? Can I give you store credit? Do I give you a full return? So you can quickly ask that through voice, through text. It's multimodal and get that response back really quick. This plays into the labor shortage and onboarding more quickly. The second one is a Sales Agent. So this is we integrate to the HIM or the product information management system of our retailers, and that brings in all of that product information. So of course you can do simple things like, hey, what's the price of this? What's the inventory on that? You can scan a barcode and then ask questions about the barcode which represents that product, everything from health information to allergies to calories, so anything that's in the product information base. Does this go with that? Kinds of questions as well. So that's the Sales Agent. And then we have something called Merchandising Agent, which allows us to enable the fastest way... Tells the worker what steps they need to take and automates entire portions of the workflow. So that's the... And we have a Device Agent as well. Sorry, just Device Agent is understanding all the details of our products. And so if you want to ask a question around how do I make this product work with that one, how do I change the media or the supplies in this printer, it'll walk you through that step by step for troubleshooting and so on. So those are the four agents. They all fit under Zebra Companion. And you don't have to know anything about those agents if you're the frontline worker. You just ask your question or take your picture, and then it tells you what it can do with that and routes automatically in an automatic fashion to the right agent.

So it varies by agent, but for the most part they use their data lake. And in the case of Knowledge... Things like videos and links to PowerPoints and charts and graphs, as well as all the text. It's able to ingest all that and then augment the LLM so your prompts can be used to pull that information back. But one of the cool things we're doing with it in an enterprise context is ensuring that the answer we give back to that frontline worker can be clearly attributed back to a policy and procedure documentation. Because we don't want to be in a situation where it's making up an answer or it's hallucinating or something. So the attribution of the answer it provides in a closed loop fashion actually back to the document that was created is something that we worked on with Google that basically grounds the model to ensure we're giving all the right information to the worker. And that's critical.

Right. Yeah. Well, everything's going to be connected to everything for one thing. So the store is going to be omni in every sense of the word. I think you pulled up some things earlier in our conversation where you were saying an understanding of the customer, so curated and personalized experiences. That's already happening, but it's going to get to another level. We're seeing retail media networks take off in a major way within store. So I think there'll be more screens and ability to interact, but do that in a personalized fashion as you walk. Absolutely, with agents as you walk up to those elements, where we'll have much more automated. The digital twin, which won't... Shelf position in a given store other than maybe what the store reports on some manual basis. Well, once the store is fully digitally twinned in five years from now, that information is brokered right to that CPG company. They can see exactly what's there. So now think about that. They're not sending somebody to the store to replenish something that doesn't need replenishing. They're able to see things you talked about like dwell time. Did people pick something up and put something else down from a merchandising perspective and optimizing that? So I think the more exciting thing is not just what's in the four walls of the retail store, but what's the rippling effect of all these technologies that are deployed in the retail store to the whole rest of the supply chain. And that changes the economy and it changes our experience as consumers.