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Transplace Keeps Arkansas as Second Home

5 min read

Arkansas Gov. Asa Hutchinson and Transplace CEO Frank McGuigan used oversized scissors to cut the ceremonial ribbon at the opening of Transplace’s 150,000-SF office building in Rogers on July 15.

For McGuigan, the establishment of the facility in Rogers, which replaced the company’s previous location in Lowell, made perfect sense. The company may be based in Frisco, Texas, but Arkansas is also home to the third-party logistics provider.

“It is our roots,” McGuigan said. “We have been here for more than a couple of decades. We have grown many leaders here. We think this area, because of great companies like Walmart, is rich with opportunity for our technology to support CPG [consumer packaged goods] and food and beverage shippers.”

Transplace was founded by another Arkansas company in 2000. J.B. Hunt Transport Services Inc. of Lowell joined with five other transportation companies to contribute $5 million each to create Transplace.

In 2009, J.B. Hunt and three of the remaining partners sold Transplace to CI Capital Partners. In 2017, that group sold Transplace to TPG Capital.

A week after Transplace officially christened its Rogers facility, it announced it had been acquired for $2.25 billion by Uber Freight, the trucking division of the ride-sharing company Uber Technologies of San Francisco.

In the two decades since its humble beginnings, Transplace has grown to what the company said is the largest managed transportation service provider in North America. Transplace said it has 3,100 employees, generates $3 billion in revenue and manages approximately $11 billion in freight.

Of the company’s 3,100 employees, more than 1,100 will eventually call the Rogers operation center their workplace. Transplace set the facility’s construction in motion several years ago and broke ground at the location at 4909 W. Magnolia St. in 2019.

No Silos

McGuigan said the company had expansive plans for the building, which turned out to be an unintended blessing when the COVID-19 pandemic hit the United States.

The building’s open floor plan and excess space meant that employees would have plenty of room to socially distance when they returned to office work. The Rogers facility opened for employees in late June.

The original intention of the expansiveness was to avoid silos, the business term for one department working independently from another. McGuigan said that in supply chain management, silos are counterproductive.

“You can see by the architectural components, it was structured from a collaboration space standpoint,” McGuigan said. “This building is built for how we do business. We work in teams, and we work cross-functionally. We think about things and we work on projects together. It is a wide-open space to encourage that cross-functional work and innovation and collaboration.”

Tracy Rosser, the company’s executive vice president of operations, said best business practices should no longer include such segregated work models. Rosser made the comments during a “Supply Chain Now” webinar that Transplace posted on its website.

“There is a penalty for siloed behavior,” Rosser said. “If you’re siloed internally and with your customers, then you’re not reaching the full outcome that would be achieved.”

McGuigan said about 800 employees have moved to the new building and he expects to fill it in the next two years.

“It’s not a distribution center; it’s an office building but it’s also a collaboration center,” McGuigan said during the “Supply Chain Now” webinar earlier this year. “What we want is a state-of-the-art building with state-of-the-art equipment and breakout rooms and technology.”

McGuigan said the pandemic didn’t affect the building plans other than persuading executives to upgrade the building’s air quality-control system.

“We are extremely excited, and we think the timing of this is fortuitous,” McGuigan said. “We wanted folks to come back from the pandemic to this new building. We had an idea, and the pandemic didn’t change it. We did actually end up changing the air-circulation unit and spending [more] on something that would capture everything. It is hospital grade.”

Real-Time Tech

The real business of Transplace is not building modern offices but providing services and technology for shippers. The company has made significant investments in technology over the years, investments that proved their worth when the pandemic struck.

McGuigan said during the “Supply Chain Now” webinar that the onslaught of the pandemic was “one of the most challenging times I’ve seen in my 30-year career.” But on a podcast, “Talking Logistics,” he added that while the pandemic wave was frenetic, it was a “microcosm” of what shippers and logistics companies had been dealing with for years with volatile demand, tight capacity and political issues such as tariffs.

“That said, this is what we do best,” McGuigan told “Supply Chain Now.” “This is [why] people hire us to support them.”

One of Transplace’s key technologies is its Data Insights. In 2019, Transplace hired Matthew Harding to run the company’s Data Insights & Analytics team.

“If you can’t measure something, you can’t manage something,” McGuigan said.

McGuigan said Transplace uses its technology to provide service and solutions to its shipping partners. In today’s hectic logistics world, those answers have to be found much quicker.

“In essence, you can see today what happened today in the network and how you’re competing against your peers,” McGuigan said on “Talking Logistics.” “We’re taking live information or identifying proactively with machine learning.”

Rosser, a former long-time transportation executive at Walmart before joining Transplace in 2019, said the old ways of gathering information don’t work anymore. He said reports that show what happened in the supply chain the month before aren’t relevant.

“We’re trying to plan for a very short time horizon out into the future,” Rosser said. “Never has there been a [bigger] need for accurate real-time data that you can use to execute today and tomorrow. You need to know what’s happening in your network yesterday and today, and you need to know what’s going to be happening in the next couple of days.”

McGuigan said companies that were digitizing information and using technologies were in a better position to deal with the volatility in the market exacerbated by the pandemic. Transplace has increased its technological investments by an average of 30% annually the past four years, McGuigan said, and acquired three technology companies in 2020, including two after the start of the pandemic.

“Transplace doesn’t operate the way we did five years ago or 10 years ago,” McGuigan said on “Talking Logistics.”

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