[00:00:00] Welcome to the Digital Velocity Podcast, a podcast covering the intersection between strategy, digital marketing, and emerging trends impacting each of us. In each episode, we interview industry veterans to dive into the best hard-hitting analysis of industry news and critical topics facing brand executives.

Now, your host, Erik Martinez.

Erik Martinez: Hello, and welcome to this episode of the Digital Velocity Podcast. I'm Erik Martinez, and today I have Joe Hudicka, who is a CEO and founder of EvenFlow, a software solution that helps businesses unify their various digital communication channels.

Joe is also an author of the AI Ecosystems Revolution. A well-known speaker, a supply chain expert with 25 years in the business process, re-engineering, business intelligence, and technological innovation. Joe, thanks for coming on the show, man. I really appreciate it.

Joe Hudicka: Absolutely, man. I'm happy to [00:01:00] be here. Thank you.

Erik Martinez: Just for the audience, Joe and I met in this public speaking class we took for the last seven months. It was an amazing experience and he's just a bright light and a lot of fun. And today we're gonna be talking a little bit about. AI ecosystems and we're gonna be talking about communication and trust and how that impacts our businesses and forecasting.

So, Joe, let's learn a little bit about, you. Just give us that brief, how did you get to this spot?

Joe Hudicka: Sure man. Look, I've been creating custom software solutions for really cool places for a long time in a lot of industries. But recently I discovered something and as I contemplated and looked throughout my time and experiences, I started comparing those to others and I think we've been building it all wrong.

It's been a fun ride, and I've created and been a part of really amazing things. But, I started to notice we've [00:02:00] been isolating ourselves. We've been creating technology that. Literally makes the people help it rather than the other way around. And I think there's a tremendous opportunity for us to fix that going forward.

Erik Martinez: We are helping our own technology. Yeah. I hadn't really thought about it from that standpoint, I was reading your book, thank you, by the way, for sharing an advanced copy coming out in April, folks I was reading your book and, you're right.

I've worked with a lot of those different kinds of systems and yeah, we're busy inputting data into them so that they can do something and potentially connect to this software over here and those linkages are broken. And it happens, for our audience, it's usually the website connection to their, if they don't have an ERP, they at least have an order management system and a warehouse system that's connected to that, which is connected to.

All this shipping systems, which goes into the area of your expertise of getting [00:03:00] that stuff. To the end consumer, and all along the way there's pieces broken. And what's interesting, as a marketer, it's frustrating, right? Because you're sitting there like, I'm creating demand.

And that demand goes into the system and then it's out of my control. And then. Does the package actually make it to the customer or not? It does way more often than it doesn't, but there's lots of little pieces, parts that are challenging in that whole process. So, tell me, Joe you just talked about it being a little bit broken and back at backwards. I was about to say a word, bass ackwards. Why are you writing this right now? What�s the impetus this moment? What was that key insight that you were looking to solve in this process?

Joe Hudicka: The next time a pandemic or equivalent occurs, I don't wanna be running around trying to figure out where the hell to get toilet paper. Quite honestly, that's where the thought process began. It was March, [00:04:00] 2020, and I knew it was going to be like a northeastern snowstorm. I knew that was gonna take place.

There'd be a run on milk and bread and whatever. I did not realize. It would go all the way down to toilet paper and that we'd have to drive to Costco every day, two hours before it opened to look at a guy holding a sign to tell us how many pallets were showing up or not, and people were lining up and getting tickets to be able to get Lysol.

I grew up with my mom making Lysol in the factory. When I became of age, I worked in the Lysol factory. Now I can't get Lysol. What the hell is going on? So, for me, it started in March, 2020 when I could see fundamentally we can't do business the way we always did now, ever again, and. I watched it from March through April, May, June, July, August, September, and finally in October I called timeout.

That was the moment where I [00:05:00] said, everybody knows we can't keep doing business this way, and they're still not changing. That was the moment where I realized I had to commit. I had to study. What exactly was happening in the way that we built software and use software pre pandemic and what we really need before the next pandemic or other crisis.�

And what I discovered was we've got this fundamental problem that really smart economists have named the bull whip effect in supply chain. Everybody's a supply chain expert thanks to the pandemic Now, cause there's been plenty of reports on it. But the thing is, when you crack a whip, the smallest wave in the whip is closest to your hand.

The starting point, that signal, that shift has a bigger and bigger impact the further you move down the tail of it. Same thing in supply chain. If the supplier doesn't have the material. That's gonna affect the manufacturer, that's gonna affect [00:06:00] the consumer products group, company, the distributors, the retailers, the consumer at the end, and every transportation company in between.

�Everybody gets adversely impacted, and the longer we wait to share these signals with each other of supply and demand changes, the higher fear gets. So why were there ridiculous lines? Why did everybody like my dad become like my dad to start turning their houses into toilet paper warehouses because of fear?

Fear, they thought there wasn't gonna be any. One thing they did not want to deal with was not having toilet paper in their hand, right? So, I looked at that and said, enough, there's a different way that we can build in how we communicate with each other from the consumer all the way back through the supply chain end to end.

So, we have greater awareness. And with better awareness, we can bring better resilience. And with resilience we can reduce the craziness.

Erik Martinez: Yeah, it [00:07:00] is interesting because, I think the marketers and merchandisers listening to this are probably going, okay, we get that, but why is this hit home for me as a marketer? Right. You're talking about supply chain, which is one piece of these incredibly complicated puzzle that starts before with demand generation, which you illustrate really well in the book.

Like, you illustrate the fact that starts with demand generation. It works all the way through to the end consumer, and there's a million touch points all along the way and it's so fragile. So, I was reading this book, I've really gotten back into reading both fiction and nonfiction, but I was reading this book and it's a nominal spy thriller, high action type thing. But one of the things that happened in the book is they blew up the Panama Canal.

Joe Hudicka: That would be a problem.

Erik Martinez: Can you imagine? I was listening to a segment on, marketplace, which [00:08:00] is a broadcast on NPR last night. And we've got all these tariffs and one of the things the guy from the company is a company down in Lakeland, Florida that. Manufactures or brings in steel parts for very specific industry.

Anyways, they were talking about the Panama Canal, and he said, the challenge with the tariffs right now, whether you believe in them or not. This is not a political discussion. This is a supply chain impact to your customer discussion, of which he said, the way these tariffs got implemented.

In the past we would get an exemption that would cover anything that was on the water or already committed to. And the way these got implemented this time was they had a pass to March 7th, so anything that came in from March 7th, he's like, we're in Florida, so the stuff has to pass through the Panama Canal.

But everybody's stuff has to pass through the Panama Canal. And so this March 7th deadline basically [00:09:00] created a bottleneck where he is like, we got some stuff in before, but we still have stuff that's sitting in the water. Just can't get through the canal fast enough to get here. For me not to have to pay the 10%.

So now what do I do? Do I raise my prices to accommodate the 10%? Just so you know, marketers, this is a real problem because now there's a messaging issue here, either raise your prices to your consumer, or absorb it and make less margin and maybe they can't.

Do some of the things that you need them to do further up the supply chain. So, it's all interconnected and it's all really super fragile. So, your book about how to bring this stuff together is hugely important. But I think one of the stories that really struck me, Joe, was the story about fast fashion and I think, marketers are somewhat disconnected from the supply chain, right? We generate demand. We drive traffic to websites, we bring customers in the stores, and we forget [00:10:00] at that point that there's other things happening. We know about it. I mean, it affects our numbers, right? When somebody buys something or doesn't buy something, it affects our numbers.

But I think the story of fast fashion was very interesting because it's of a marketing play and one of the the things, I might be dating myself here back in business school, we were talking about logistics as part of, one of the four Ps of marketing. I think there's five Ps now, but there are four Ps in marketing and logistics was one of them. And you got to sit here and go, here are some companies who are using logistics as a marketing play. So let's talk a little bit about fast fashion and what they're doing.

Joe Hudicka: Absolutely. First, let me frame it in what my research led me to define as a silent shift what we're referring to. When we get to this fast fashion example is really the third major evolution of supply chain design on a global scale. [00:11:00] And it is happening right now and most people just aren't aware of it.

Hence the term, silent shift, massive changes which effect entire industries. Yet. They seem small and maybe even meaningless at first until by the time everybody realizes the shift, it's already too late to do anything about it. In fast fashion, the major shift that's taking place is back to simplicity of supply chain design.

See, in silent shift 1.0, every town had its own little, tiny stores and you can get whatever you wanted very easily. The shift to, 2.0 was when we started having an increased demand for a larger volume and variety of goods, which caused the supply chain to get more complex. How are we gonna make a larger, more variety of goods and still keep the price low?

We had to find other places to make things. Those other places were further away that required more transportation, and that transportation now had to be land and water. What's faster than land and water? Air But [00:12:00] that's the most expensive mode of cargo there is. How can anybody imagine a new mode of supply chain design that could be solely reliant on air, fast fashion?

And that's the silent shift. Of global supply 3.0. That's what's happening. See what they're doing is they looked at the way our current world of retail takes place and gets their product. A design will happen for a new shirt. Because a lot of people saw it in social media, some rock star or movie star or whatever was wearing it.

Demand is chattering in all of our social us marketers wanna jump on that trend as fast as possible, and it's gonna take a year of cycle in product design and development, manufacturing, and then transportation. No, nobody wants to wait that long. What the fast fashion companies have done is they have looked at this massive investment in complex transportation and logistics like distribution centers and [00:13:00] trucks and drivers, and they said, we don't need to build that.

We'll just outsource. There's partners out there that'll do that, and instead of investing that money in the infrastructure, they took some of it and said, now we can afford to pay for air transport. Now, how do we generate the demand? Well, that's what our marketers know how to do great. And what we could do for our marketers now is make a brand-new product that all of a sudden, we've generated incredible demand for that didn't exist two days ago, and actually deliver it within a few weeks. That is the transformation that's going on, and it will make Walmart, Amazon, Target every one of 'em.

They're all gonna be scratching their heads soon. Quietly behind doors saying, " We're investing billions of dollars in all this physical infrastructure. Do we need to do that?"

Erik Martinez: It's interesting 'cause you used Amazon as an example in your book, Walmart was the king of retail. And to a certain extent, it's still the king of retail, but Amazon's not far behind. [00:14:00] And you bring up this very interesting thing about how Amazon has invested in infrastructure, the trucks, the distribution centers, the planes, and.

It's fascinating to me because you sit there and go, yeah, I know this experience as a consumer, because I live in the country and at Christmas time, other times of the year, but particularly November or December, I will have two Amazon, sometimes three Amazon vans show up on my 400-foot driveway.

I will have a FedEx truck. At least once a day and I will have UPS, and that cannot be efficient to do, which is why to a certain extent, the USPS has been existed to deliver to all end points in the US right? To do that last mile. So, you're talking about incredible disruption. And then you realize, oh, by the way, most of those drivers, particularly the Amazon ones, they're all gig workers.

Which is crazy to me,

Joe Hudicka: Yes. Another silent shift a few years [00:15:00] ago if I tried to have this conversation with you 10 years ago about the idea that, your neighbor just might take a couple hours a day and decide they're delivering packages. Separate from whatever else they do. You'd look at me like I had five heads and same.

I might have looked at you the same way, quite frankly, right? Because it didn't fit the world that we lived in the world we knew. But Amazon put together a really ambitious roadmap, and they didn't announce it. They didn't go out and advertise and say, this is what is gonna happen. This is what the world needs.

They just did it. And the silent shift unfolded, and it left a void for companies like FedEx and UPS. They thought, hey we're the big players on the block. We're gonna have all this volume until there was a big void. But then guess what happened? Fast fashion showed up and said, you know what? We got another new idea that's even better than the Amazon idea. We could fill that void for you. And on it goes. These silent shifts are happening in every industry. This is just one.

Erik Martinez: And it's interesting because now we're about to talk about [00:16:00] ai, right? We're gonna talk about ai, we're gonna talk about data, and we're gonna talk about forecasting. 'cause all these things come into play and I think you're saying, what I hear you saying is there's another silent shift happening.

There's like multiples of silent shifts happening. As a marketer, I think AI is one of the things that's happening, but now having read your book and going, thinking about this fast fashion, I think it's crazy that somebody could say, �Hey, I want 20,000 of these shirts that was on Rockstar X, Y, Z,� or let's take Taylor Swift.

Taylor Swift wears an outfit and everybody wants it tomorrow, and that there's a company who could produce that, ship that via air cargo, get it into the US and out to the endpoint customer in just a couple of weeks. Is crazy.

Joe Hudicka: isn't it?

Erik Martinez: But let's think about the marketing side of that for a moment, because I think you can probably envision a time where the [00:17:00] AI will go.

Huh, Taylor Swift wore a new outfit, social is trending place the order automatically and set the whole thing up without humans getting involved. And I think that's the world that you're trying to talk about and envision connecting that data. And that's not even a forecastable thing, right?

Joe Hudicka: That's exactly right. The fundamental struggle that companies are experiencing, whether they're talking about it or not, comes down to the simple fact that they do not have access to the data that their models need in order to train it for maximum. Impact. We've got a couple of schools of thought out there.

We've got companies that are training their ai, large language models on public data. That's how the models got built in the first place. Let me suck up the entire internet. If you didn't protect your stuff, well all that's on you and boom. Now this is the stuff that taught the model. Is that creating great impact for companies in terms of predictability?

Well, largely, of course not because it's public [00:18:00] data and everybody else is doing a pretty good job to great job of protecting their information assets. The other school of thought that's out there are the companies that are, training their large language models on private data, and they're still not extracting the value that they need and want.

Why? Because. Their ecosystem owns the data that they really need. If you look at an entire supply chain from the consumer to marketing and then to all the physical stuff that has to happen behind all that, it's all signals. It's signals at a macro level, like the tariff topic that came up, and micro level, like the Taylor Swift shirt.

But we tend to hear these things in a vacuum. We tend to listen to each signal one at a time on its own individual merit, and what we need to be able to do is be able to bring these data sets together beyond our walls. We need to share. Crazy. I know we need to share. We need to make those data sets available in a responsible, [00:19:00] permissioned way, and that's the architecture that I propose in the book with AI ecosystems, we establish a standard of permissioned data sets where we can share from marketing all the way through the chain, and we can have those signals, and we can hear them. Now.

Take that. One example that you mentioned and we both agreed was crazy that we can have a brand new shirt design because we saw Taylor Swift wear something like it and we could produce 20,000 pretty quickly. Part of the benefit there to the entire ecosystem is we wouldn't have to guess how many to make and then have a bunch of product that maybe we didn't get to sell cause we didn't end up fulfilling that guest demand.

Erik Martinez: We could produce at a smaller, tighter scale based on a more quantifiable marketing test. Imagine that our marketing test is no longer just AB and digital land. Now it's actual production throughput went into the system all the way into consumer's hands.

A direct input,

Erik Martinez: right?

Joe Hudicka: Oh my god.

Erik Martinez: So Taylor [00:20:00] Swift wears the shirts, then the AI goes, huh? We see the social's trending up. We're gonna generate some ads. We're gonna place those ads in real time. Right. And again, I don't think any of this is really doable right now. Some of it might be but the AI's like, yeah, we're gonna place the ads, we're gonna generate the demand.

We know exactly how many we generated. We're gonna push that order into the ecosystem. Manufacturer's gonna make it, we're gonna ship it, and you're gonna have it in your home in two weeks. Crazy. Or less, right? Potentially less. Little drones dropping everything down from the sky. Well, that's a different thing.

Joe Hudicka: You're excited about it. I love the excitement.

Erik Martinez: Let's not go there. Let's not talk about drone delivery. I think Jeff Bezos already shot that one out of the sky.

Joe Hudicka: I'm gonna let a little air out of that balloon for a moment, right? So, according to Big Tech. All of these jobs, like we just fantasized about, are just actions that we can digitize. We can automate them and we can connect them all [00:21:00] together. They even call 'em agents, like spies, right?

And we can just create this cast of agents that are gonna all work together. But here's the thing. Business doesn't happen in technology. Business happens between people. It was a person that was wearing that shirt in an experience that someone else admired in some way. And the way that person admires it may be different than me, but we may both wanna have that shirt, right?

This is all very human and technology is not gonna replace any of that. When I talk about AI ecosystems, and I talk about how we can leverage it. In the world of supply chain and beyond, because as Erik just explained, it works whether we're talking about product, businesses or services business, fully applicable.

But what we gotta do is we've gotta help people, including ourselves, separate the tasks from the jobs , every job's made up about pilot tasks. Some of those tasks AI's gonna be able to be good at. But Not all of them and not the entirety of the [00:22:00] job. Let me give you a ridiculous example. On the other side of the spectrum, let's say we've designed a new product and we're putting our promotional marketing out there and Erik you're on the, let's say you're on the buyer side and I'm on the supply side.

Okay. So your bot is gonna visit my site to buy something. My bot is gonna communicate with your bot about what you wanna buy. Now you're a savvy buyer, so you're not gonna get into this thing and just accept the price that's there. You're gonna wanna negotiate, you're gonna wanna get clever.

So you're gonna configure your bot to know what your rules are and where your floor is on what you're willing to pay, and ceiling you're willing to pay. Right? So you're at the ceiling level on my side. I'm at the floor. I'm only going to allow you to go down to this price. One bot negotiates with the other bot and they step down into the abyss of hell to the lowest common denominator.

And guess what happens then? [00:23:00] Then humans get called in on both sides because the bots couldn't get the deal done. Now, how happy are those two humans gonna be on the other side of those conversations? At that point, there's no margin left. Everybody's pissed off on both sides. How does that? Work?

Erik Martinez: Well we've seen this happen before right? , There's well documented cases about the stock market crashes and how these automated systems, bid down and took out 500 points, 600 points, 700 points, thousand points in a day because of that. And the programmers had to go back and hey, yeah, we need to fix those rules and put some checks and balances.

So you're absolutely right. The human process has to be part of it. In fact, I go to the the marketing AI conference every year,

Joe Hudicka: Awesome.

Erik Martinez: And that is. Their opening theme. More human because we've got to be able to stay part of the process, provide the thinking and the guidelines and the strategies and the thoughts.

[00:24:00] Even though AI has some incredible capabilities, it's not gonna replace us, it may replace things we do in theory. You make this point in your book about, hey, it free us up to think more, to be more strategic, to be more creative, be more innovative. These are tools.

Let's pivot off of this topic for a moment, because I think one of the key components I've learned through reading your book is communication. Everybody talks about communication, how important it is in an organization or between players, but you have this idea about communication. Tell us what that is.

Joe Hudicka: Yeah, I call it, for streaming. I believe we need to be able to shift our conventional approach to forecasting to something that is as real time as possible. There are signals happening all around us at the macro and micro level of supply and demand. Again, product services, nothing is excluded from this model and the thing is.

We don't hear them all in [00:25:00] context. We hear them one at a time and we react to them one at a time. And so, what ends up happening is we make less informed decisions, I guess is a good way to put it than we could. For example, a couple of years ago we heard bird flu might, show up.

Okay. It made a couple articles. A year later we heard. It's a little worse. Okay. But when we looked at the trend, it really wasn't much of a delta. So ignore it until it hits its own tipping point and all of a sudden we've got dead chickens and no eggs anywhere. And here we're trying to fly, literally fly eggs. Probably one of the most fragile food supplies we can have halfway around the world. We're flying eggs? Did it have to get that bad? I'm not saying that we could have prevented it. What I'm saying is if we were listening to all those signals earlier, we would be networking the potential suppliers [00:26:00] that we have, maybe geographically closer, maybe they might be in turn, adjusting their production accordingly based on the signals that they're seeing for the next six months, the next 12 months.

And maybe when crazier things that were also equally unexpected, like tariff threats start popping up, maybe we would add multiple options on the table instead of what is the most expensive, worst case scenario available today because I waited to react until this 9 1 1 moment. Like for streaming is what I call the process of adaptive forecasting.

If we start streaming our signals of supply and demand and communicate those to each other in the form of what I call a connected conversation, as we start having this conversation about whatever it is we are procuring or producing, and we feed these signals into it. We're gonna learn and adapt as it's happening with a full 360 degree [00:27:00] view from supply all the way through demand.

And I think that level of visibility is very achievable. All the data's out there, we just don't share it enough yet.

Erik Martinez: You're absolutely right. I could just think about my daily communications and how they go and all the myriad of ways people can get ahold of me and talk to me and share information with me. Between the emails and, I don't know, five or six different instant messengers and teams and slack and so forth.

It can get really overwhelming. But you're right, we can leverage technology to help identify the themes and pass the relevant information along. That's beautiful.

Joe Hudicka: And learn from it in my connected conversation architecture, it can be listening to those signals. It can synthesize them. It can round it up and have a conversation with you. The person. And give you the synthesis. [00:28:00] Here's what I see happening right here are the changes that are trending. Here's some recommendations we might be able to consider.

And the human is the only member of that connected conversation that can make the best choice. So AI can do some of the tasks I. And you connect it with my connected conversation concept, putting all the right data in the right place. It could do a really great job of summarizing that and making some observations, insights, and maybe recommendations faster than the human can do some of those things.

But the human is gonna be the only player that can look at it in the full context, the full humanistic context, meaning. The impact of whatever decisions getting made, impacts far more people and organizations than just them, and AI will always lack that human context.

Erik Martinez: I totally agree, Joe. We're just [00:29:00] about out time and I wanna be respectful of your time and thank you again for coming on the show. Is there any last thought or piece of advice you'd like to leave the audience with?

Joe Hudicka: I'd like to share that you might be seeing implementations of AI.

That you don't like or that you fear or that you doubt, and it's so early in, in this journey that there's probably not a lot of people for you to talk to about this sort of stuff. So, I like to invite you to not just see these things passing by. But be just as curious as you hear Erik and I being look at these examples a little deeper.

Think about the thinking that is going into the decisions of the way AI is being applied. Determine if it's being applied responsibly or not. Do it within the organizations you work in, the organizations you buy from and share these in conversation with each other. In fact, soon you're [00:30:00] gonna see a new announcement out of the AI ecosystems revolution.

We're having more and more people come to us and wanna have conversations like this, so keep your eyes and ears on the lookout because the AI ecosystem's underground. Will show up soon. We�ll not only be able to share these signals on the responsible and maybe sometimes not so responsible applications of AI we're seeing, but we'll also be able to work together to craft strategies on how to help everybody do a better, more responsible job of making software, which actually helps people, putting people first.

Erik Martinez: That's awesome. Joe, if somebody wants to reach out, what's the best way to get ahold of you?

Joe Hudicka: There's a few keyways, joehudicka.com. You can certainly check me out on LinkedIn, foreward slash Joe Hudicka, and you can email me direct Joe at joehudicka.com.

Erik Martinez: Joe, well, thank you so much for your time [00:31:00] today. I'm excited about where you're headed. The book is coming out in April,

Joe Hudicka: April 29th in print and audio formats through Amazon and Barnes and Noble.

Erik Martinez: Awesome. Well, we'll put that in the show notes. It is the AI Ecosystems Revolution, and that'll be released next month, Joe, thanks. Thanks a lot for your time. Folks, that's it for today's episode of The Digital Velocity Podcast. Have a fantastic day and be more human.

Thank you for listening. If you have enjoyed our show today, please tell a friend, leave the review and subscribe on your favorite podcast platform. Visit the digital velocity podcast.com website to send us your questions and topic suggestions. Be sure to join us again on the Digital Velocity Podcast.