Testing, Sustainability, and the New Supply Chain Reality: Packaging World

What new demands is automation placing on packaging performance and testing?

Packaging World Editor-in-Chief, Matt Reynolds, sits down with  IBM's Bill Green and ISTA's Eric Hiser to discuss how e-commerce, automation, sustainability, and data are reshaping packaging design. Meanwhile emerging automation requirements for the Walmarts of the world are raising the stakes for pack testing and performance.

Watch the full featured video on Packaging World.

Transcript

SPEAKER_00 0:03

Welcome to Through the Line, the podcast exploring innovations and information across the packaging and processing landscape. From topics impacting consumer packaged goods and healthcare packaging to the latest technologies in food processing operations.

SPEAKER_03 0:22

Hi, I'm Matt Reynolds, editor of Packaging World magazine, back with another edition of the Through the Line podcast. Have a listen as I speak with IBM's Bill Green and Ista's Eric Heiser from the International Safe Transit Association TransPAC Forum back in Phoenix, where we dug into the evolving demands on packaging from the rise of e-commerce and automation to the growing role of AI and data in package testing. We also explore how brands are balancing sustainability goals with the realities of distribution and why understanding new supply chain hazards is becoming more critical than ever. As you can imagine, AI, automation, and sustainability all play a major role in the conversation. So welcome, Bill and Eric. Why don't you introduce yourselves?

SPEAKER_02 0:59

Hey, I'm Bill Green. I am the immediate past chair of ISTA. I'm rotating off this year. I did four years as the chairman of the ISTA Global Board. I also work at IBM for my day job as the distinguished engineer and chief technologist for our supply chain.

SPEAKER_03 1:17

So you're on packaging and your day job?

SPEAKER_02 1:19

I am on packaging in my day job. Good.

SPEAKER_01 1:21

And Eric? Yeah, Eric Kaiser, and I'm on staff at ISTA. I work with our members in the industry to update and maintain the standards that get published that get used to verify performance of your packaging system and help ensure that you're reducing damages during transit.

SPEAKER_03 1:38

Sure. And you might also recognize Eric. He's a frequent columnist in the packaging world for those of you who get the print edition. So we'd like to have you back. So big picture before we start zooming in on some of the details that happened over these last three days, what are some big picture takeaways, biggest shifts that you're seeing in packaging distribution?

SPEAKER_02 1:55

Yeah, do you want to lead us off, Bill? Sure. So I think a lot of the biggest shifts that we're seeing in packaging is the explosion of e-commerce, but also now the age of AI and data, where we're able to dig into better using these types of tools to get insights not only into how our packaging is received, but also what are happening around sustainability, what is happening with damage and these types of things to make sure and to optimize our supply chains.

SPEAKER_03 2:26

Sure. A lot of the brands have a lot of competing goals, almost feels like competing goals now. But you mentioned AI. So let's dive right into AI. You actually presented on a Gentech AI yesterday. You see it applied in a lot of different ways. Flows, customer reviews is another one. What do these cases tell us about AI's place in package testing in the future?

SPEAKER_01 2:44

Bill, since you talked about AI, I didn't hate to put you back on the spot again, but yeah, take it, take us away on AI.

SPEAKER_02 2:49

Yeah, so fill in. So, like the the ability for us to use all types of different tools of AI, generative, all types of generative AI, as well as a gentic and other types of tools, now allow us to have a very good picture into what the cut consumer is thinking about our brand, about our packaging, about our methods of shipping. All of these things now are accessible to us without brute force and trying to read thousands of reviews. It now boils it down, gives you sentiment. It does a very good job with sentiment, and you can train it to be even better. So you can have very accurate information about how you can continue to grow your business through these type of tools.

SPEAKER_03 3:39

Okay. Now you mentioned sentiment. We'll get to that in one second, put a quick pin in it. You did a really good job yesterday of disambiguating to use a mini-syllabled word between agentic and the common chat bot. In a very quick 10 seconds, 15 seconds, can you which which is which? Because people say AI and they mean different things.

SPEAKER_02 3:56

So your chat bots that are looking like Gemini, like Chat GPT, and these type of things do a very good job with unstructured text, unstructured data that they could take it, you can ask it to do a thing, and it does one thing, and it does it well in many cases. And you can train it to be a little bit better. A Gente is basically in the agents. So when we look at the agents in AI, we're looking at something to orchestrate what they're doing, and then the agents go and they're different parts of what you want. So a gentic AI basically does an end-to-end solution. So if I need to create a tool that pulls data from here, scrapes the internet from that, pulls that from over here, puts it all together, it does it end-to-end. And in a lot of cases, you can do security governance, you can do architecture, you can do all these things, like with IBM Bob. And so if we're able to do all these things, it really brings a lot of ability to folks that are not necessarily deep programmers and deep folks in computer science to actually dream up things and put things together.

SPEAKER_03 5:13

Okay.

SPEAKER_02 5:13

So it goes out and it's goal-oriented. Okay. It'll I want to see what the end goal is, and it's going to be an assistant that takes you all the way to that end goal.

SPEAKER_03 5:23

Okay. Interesting. One specific do you have anything to add? Sorry. No, I would like to hear from you about one specific presentation today. We we might call them a probe into what's coming next. We've traditionally heard about package testing in the lab. We've heard about package testing in the field, but there's been this wealth of information about how a package is actually received by the consumer that might not have always been available, but AI is bringing that to the table. This was a Michigan State presentation yesterday about scraping Amazon reviews that sometimes have photos of damaged packaging, this sort of thing. So is this going to be, is this type of technology going to be in the toolkit going forward for package testing?

SPEAKER_01 6:00

Yeah, I definitely see it being very valuable in the toolkit. It's a going to enable packaging designers to better establish criteria of success, right? So instead of assuming or guessing what your customer is going to think is okay. So as at the end of a test, if we put it as a real world exercise here, at the end of the test, you have a scratch, you have a dent, you have a ding. There's a discussion about is that going to be acceptable by the consumer. This program that MSU was talking about tells you right away what your customer tolerance for damage is. On a slight scale, yeah. Yeah. And so you can make those decisions right away as you go through that design process and help further optimize your packaging because now you know what success is. So I think it's going to be a really valuable tool.

SPEAKER_03 6:46

Okay. A new tool in the toolbox. All right, shifting real quick. There is a large retailer here, retailer that starts with the letter W out of Arkansas here yesterday. Interesting presentation, all about automation and the increased use of automation. We can tell Walmart is probably ahead of the game as they are in a lot of things. But meanwhile, brand owners, their suppliers, CPGs, they're under a lot of pressure to lightweight packaging. They're under pressure to right-size packaging. They don't want to be shipping air, is making some demands on them that they actually have to pay for the types of material and how much material they're using. A lot of different things, a lot of different pressures. Meanwhile, there's this whole new, entirely, it's not entirely new, but a coming necessity to design packaging also for automation, not for human hands, but for automation. What you heard from Jim Thompson from Walmart yesterday, how does that impact the brand owners and retailers and how they have to test and think about things like uh horizontal pressures as opposed to the vertical pressures, that sort of thing?

SPEAKER_01 7:40

Yeah. I think it just goes to the story of the supply chain is always a fall thing, right? Things are happening. Packaging is confronted with different hazards, and those hazards are part of that evolution. And automation is the new frontier of what packaging is seeing. And so that's a big part of what ISTA is trying to do, is bring transparency to what happens once that package leaves your facility. And the automation stuff, as we're starting to learn from Jim and others, is presenting new challenges, horizontal compression, especially at the full layer level to a palette. To depaletize robot arms picking and moving and all these different things, putting stresses and strains on packaging that may have not been anticipated. So you see in perforations, burst, and things like that. Yeah, that that's it's a new hazard. And sometimes these are benign or lower intensity, but it's enough of a fatigue that then trickles over into a full-fledged damage later on. So you really need to know and stay on top of what these different hazards are as the supply chain evolves.

SPEAKER_03 8:47

Like you said, evolves. Evolves is the right word because you have lightweighted to optimize for one thing. As a new factor comes in, then it's no longer optimized. Optimized is a balance, it's a trade-off between a lot of different factors. And it might not be the lightest weight that it could be, but it's going, it's going to be as light of weight as it can possibly be and still withstand those compression pressures from horizontally. So a huge amount of calculus. Somebody's going to have to come up with the algorithm that just figures it all out to put it all together. Okay, shifting again from Walmart. Let's talk about the poll yesterday. At the end of the day, you did an audience poll. We won't get into the details. Clearly, most of the audience was packaging engineers, which was really cool. That's our audience. What did you see in that poll that may have leapt out to you as either different or changing over the years? Anything new that's emerging?

SPEAKER_01 9:34

The benchmarking was it something new that we've been doing at TransPat the last couple of years to really help everybody understand in kind of an anonymous way.

SPEAKER_03 9:42

Yeah.

SPEAKER_01 9:42

What everyone's facing. Along the automation element, I was surprised that several people were already considering it. Rodney from SAJ shared how they're approaching the automation question. And it was different than what Jim was sharing about the DePal and all that. It was more about label placements and that sort of compliance with automation. It was interesting to hear people acknowledge automation, but that it was different than the new frontier that we're hearing from Walmart.

SPEAKER_03 10:14

Yeah, that is that and when we hear about terms like Sunrise 2027, the types of labels and stuff that we're going to be using, where they have to, where the sensors are going to be able to read them and where the sensors are placed. And there's again that there's going to be an algorithm that solves all of this or a single piece of and a single equation, but we don't have it yet, especially as things change.

SPEAKER_01 10:30

So that's what stood out to me. I don't know about you, Bill.

SPEAKER_02 10:32

What from that benchmarking. I think benchmarking of itself is great because it gives the global board, and we started doing this because it gave us some direction on what is important to our membership. In the end, driving benefits and value to our membership is what we're all about and what we obsess over on the board, as well as a lot of the staff as well. We want to bring that. This forum allows us to get together and understand what's important. And at the same time, the thing that I noticed was the sustainability aspect and how much more pervasive it is, and how much more it is becoming important for because of global regulations, because of APWR. Yep, because of customer expectations, all of these things. And many brands and consumer brands are now leaning into sustainability as a selling point. And if you have a sustainable product that never makes it to the consumer, it is the opposite of sustainable. That first thing that you've got to do is protect that product. And if you don't do that and the customer's unhappy, not only do you take a hit and you don't lose that customer, but when you look at the sustainability aspect, it's returns, it's carbon footprint, all these different things that goes downhill. So you're doing the opposite. Yeah. So that's why I think just the blocking and tackling of testing, making sure you can make it through whatever distribution cycle you're trying to sell through. So it can be moving the psyche type stuff. It can be like deliveries from your local store, hand deliveries, like Walmart Plus is hand delivered things. I love it. It's like I can order stuff from the grocery store, and when I get home, it's there and I can cook dinner, or my wife can, or we can do things.

SPEAKER_01 12:25

So yeah, that connection between sustainability and damage is a really good one. I think I'd highlight for your audience too that ISTA just did a sustainability survey. Oh, yeah, and we found that 30% of the respondents saw an increase in damage to their product as it related to sustainability initiatives. So it's trying to find that balance of all the different ways packaging designers are pulled and not lose sight of what we view as the primary goal. Right. You're not sustainable if the product isn't given to the consumer.

SPEAKER_02 12:59

Exactly. And many customers don't understand that. They see plastic, they see other things like that may actually be a sustainable type of solution because it uses less, it's a lower carbon footprint lighter weight. The customer there is lighter weight. And so it becomes difficult. So the innovation that materials folks are doing in packaging is very important. I think the work that packaging engineers do to ensure that their products get there are grossly undervalued in a lot of cases. You're taken for granted as a packaging engineer until something goes wrong. Then you're the most important person in the world.

SPEAKER_03 13:41

You hear that a lot. And Eric, you and I, you you and I spoke about it yesterday. It's one step forward, two steps back. The losses or the detriment to a return or leaker or something like that is so much greater than the thousands of units that shipped with maybe one gram less corrugated for that case. Yeah, exactly. Exactly. The one single loss, it really weighs heavily against a huge volume of successes. And that's where testing becomes important.

SPEAKER_02 14:05

That's where verification and testing. And I think if anything, doing the work, doing the test, the blocking and tackling, that in and of itself is sustainable. And that's some of the things that we've tried to push in our global sustainability board to try and look at, or global sustainability committee to try and look at to see how do we message that because we view it as an incredibly important, an incredibly important aspect of this. And unfortunately, many brand owners just don't have that expertise. So that's where Insta comes in to give people to train people on that expertise, to have them understand oh, it's not just the product on the shelf, because the product on the shelf may actually go into a box and ship. Am I prepared for that? The days of going to the grocery store and getting things, and that's the only place you can do that. That's the shift in the last several years.

SPEAKER_01 15:10

I would say that so, yeah, the testing is for sure critical block blocking and tackling, but ista has a responsibility to ensure that those tests are evolving. We heard from Paul Larson this morning at Amazon about the important partnership of Amazon and ISTA working together to bring that transparency of what's happening so that you can design for that, but staying current, right? So the Amazon overbox test was just updated to align with their kind of journey through now that it's paper dunnage. So the test incorporates that. And so it's doing the testing, but making sure you're using the right test, and the tests are evolving with those supply chains so that you know things are meeting the mark.

SPEAKER_02 15:52

And this isn't just a North American, a US problem. Okay. Correct. This is across the world. This revolution that's happening, not only with AI, but also with these supply chains. And supply chains became incredibly important and front page news during COVID, right? Because everything collapsed because of all the things that we had to do with distancing and people not going out and staying at home and all these things where people got very used to having things delivered to them. So they've exploded all of this. So the entire global supply chain has completely revamped itself. Consumer expectations have completely revamped themselves. And as these kids come up and get older and now become adults, their expectations are much different, and their voice they will voice their opinion. Yeah, they want to.

SPEAKER_01 16:48

So you gotta listen faster and with less everything.

SPEAKER_02 16:51

Yeah, less everything. And sometimes they're very realistic and make real a lot of sense. Sometimes the expectations and the ability to deliver on those expectations cross one another. You as a brand owner have to find that sweet spot where you're delighting the customer, but also making sure that you're protecting your brand because it does not take much and it does not take very many voices to give you a one star to say that you're no longer going to be sold on this platform or those types of things. So it's really important that you pay attention and you understand your supply chain end-to-end. Map out that supply chain. How are they being delivered? Why is this happening? Right. And you have to look at the lowest common denominator in a lot of cases, whether it's the warehouse worker, whether it's a clamp truck, whether it's a forklift, whether it's the person walking up from their personal car, dropping it onto your porch and taking a little photo of to make sure.

SPEAKER_03 17:58

Sure. Now we have actually metrics of those one stars, as our Michigan State example from yesterday. We can quantify it and we can actually apply that as a test. You mentioned COVID and supply chains. You've had a unique view over the last what four or five years as chair. Anything, what would, if there's one thing that you said that you would say has changed the most between when you first took over and now is your today, this being your last forum as chair? What's the one thing?

SPEAKER_02 18:23

The one thing that I think that has changed the most is the explosion of data and AI, to be honest. I may be a little biased, but I see that as something that is emerging. A close second would really be the explosion in home delivery and e-commerce for supply chains, especially for consumer products. Sure. Now that applies to packaging. And the importance of packaging has now gone from important to paramount. Paramount. It is the way that you convey your product to your customer. It is the way that they use your product in many cases. It is the way that they get that first unboxing experience, which we see on YouTube videos all the time.

SPEAKER_01 19:15

It's a one-to-one relationship. There's no second chance. And someone in the back room going, don't put the dented can on the shelf. Use the old analogy. Exactly. There's no net underneath. Yeah. To get that product to the consumer.

SPEAKER_02 19:28

So ensuring that it's going to get there is a critical part and why we're always and we as packaging engineers need to try and put ourselves into the shoes of the customer. These tools are going to help us do that. The sentiment analysis is going to help us do that because it is very easy to fall into the trap of this was good enough. I use the Dennikan because I know that the Dennekan is okay because I'm a packaging. I've had seven years of schooling to tell me that, right?

SPEAKER_03 19:59

Yeah.

SPEAKER_02 20:00

It's that's not the same for your normal consumer who may not even know that there's a person who has a degree who has a job in packaging. Many people are very surprised at what we do that this is an actual thing. What do you make boxes? What like part of it? Yeah, but it's the testing, it's the product design, it's all these different things that people very much take for granted unless it fails or until they throw it away. Yeah. The end of life is the other thing. The end of life is the is the next key thing, right? The sustainability aspect that holds into perception and these EPR regulations, right? Which in many cases are very good or very well intended, but don't look at the entire picture. And I think we have to have those conversations with different folks to say, lawmakers to say, look, let's look at what the unintended consequences are of what we're trying to do. Okay. Because it it is there is never a sustainable option when a product doesn't make it. Good.

SPEAKER_03 21:06

That's it. The end of the life is the end of life for packaging is and the return logistics are calculus that need to basically bookend a package, where it's going and where it could be coming back. We're running out of time. We've already taken too much of your time. We've got to get down soon and see what Google has to say. We're going to be interviewing Ken Loong before too long. So we don't know what he has to say yet. We'll find out soon enough. We want to leave you folks with both one final message, 30 seconds or less, brand owners, CPGs, what do they need to know coming out of this transport of days?

SPEAKER_01 21:36

So again, back to your earlier question about what was the new, different thing. It everything old is new again, right? The supply chain's evolving. You have to stay connected, collaborate with your peers in the industry to understand what that evolution is and have that insight so you can fold it into your design and development process. So it's really critical to come to events like this, hear what's going on, so that you can ensure that you're designing and holding your packaging to the appropriate intensities and severities and just the appropriate level of rigor needed to get to the customer so it can maintain that sustainable approach that you're most everyone's trying to take. Yeah, really just staying connected to everybody so that you know you're using the right tools.

SPEAKER_03 22:25

Well, thanks, Eric, and thanks, Bill, and thanks for your service for the last few years, and then thanks to Ista for hosting me for the last couple of days.

SPEAKER_00 22:33

Thank you for listening to Through the Line Packaging and Processing. You can listen to more episodes on all streaming platforms. Be sure to visit us at packworld.com, profoodworld.com, and healthcarepackaging.com for more packaging and processing news. This podcast was edited by Bree Guns.