Baldor’s first-ever CIO sets the transformation agenda

Baldor Specialty Foods is turning to IT to take its business to the next level. The high-end organic produce and fresh meats distributor envisions IT — analytics and AI, specifically — as the key to more efficient distribution logistics and five-star customer experience.

To cultivate its ambitious digital plans, the Bronx-based company, which prepares and delivers fresh food from “farm to table” of restaurants and caterers in New York City, Boston, Baltimore, and Washington, D.C., poached its first CIO.

Chief Information and Digital Officer Satyan Parameswaran, who spent decades at UPS where he most recently served as president of IT, was handpicked to enhance the 33-year-old company’s digital infrastructure and operations and apply his advanced logistics experience to deliver elevated business results.

As an organization, Baldor is no stranger to the value of IT. Its core digital footprint is solid, having been on the cloud for some time, and employing Microsoft Dynamics ERP, HighJump supply chain management, and Orca Security services. But Parameswaran aims to parlay his expertise in analytics and AI to enact real-time inventory management and deploy IoT technologies such as sensors and trackers on industrial automation equipment and delivery trucks to accelerate procurement, inventory management, packaging, and delivery.

“The use of technology is not the differentiating factor. It’s how you use the technology to manage the inventory, keep the flow going, and manage the balance in many different ways,” says Parameswaran, who joined the company in March. “It is the art of analysis. From our point of view, customer engagement time with salespeople and drivers is precious.”

Elevating logistics

Parameswaran’s plan for elevating Baldor’s sales analytics strategy is to incorporate demand planning analytics for merchandising and operations, a move that will require extending Baldor’s Azure footprint to include a data lake for more analytical work involving data from business functions such as finance and transportation, the CIDO says.

His experience in logistics and analytics will also help Baldor improve workflows as he integrates more IoT devices into the company’s industrial operations and its private fleet of delivery trucks.

“What’s also going to change this farm-to-table business is how we exploit the internet of things,” Parameswaran says, adding that he is considering employing blockchain technology to digitize Baldor’s supply chain.

Kevin Prouty, group vice president and GM of IDC’s Tech Buyer Business, sees retailers and restauranters going after experienced logistics IT pros where cost and shelf life are of primary importance.

“While AI is the latest focus, it’s actually very common for companies to hire former senior execs and planners from large logistics companies. The logistics companies are well known for great OpEx, and as incubators of highly functioning planning tools. These planning tools are constantly transforming at the cutting edge using high performance computing, big data capabilities, and sophisticated intelligence,” Prouty notes. “That is all applied to optimizing routes and delivery capabilities.”

At UPS, Parameswaran gained experience developing machine learning models and generative AI applications and plans to exploit that at Baldor when possible. For example, he plans to develop a chatbot that can digitize orders the company receives in voicemails from chefs and restaurant managers and route them as quickly and as accurately as possible for fulfillment.

Baldor collaborates with thousands of farmers globally and plans to use Parameswaran’s expertise in logistics and delivery to improve efficiencies. One division of the company, Freshcuts, produces roughly 3,500 individual items, such as a five-gallon bucket of sliced vegetables, which customers can purchase in bulk and have delivered swiftly by Baldor’s fleet of trucks. Equipping the fleet with advanced IoT sensors and tracking devices will improve customer engagement time and reduce food waste, Parameswaran  says.

Prepping for expansion

Baldor is using OpenAI large language models (LLMs) and will be exploring other open source LLMs and small language models (SLMs) to improve efficiencies and ensure accuracy of order taking. Still, Baldor will approach these technologies cautiously, Parameswaran says, especially when it comes to training the models using proprietary data and removing bias.

“We believe that customer service and order receiving process will be tremendously improved by the use of genAI-based technologies,” he says. “As customer communication many times is verbal, transcribed data used by LLMs will revolutionize our order processing. In addition, textual data of restaurant menu cards, recipes will be interpreted using genAI tools to help us make our sales personnel extremely effective by being specific rather than vague.”

Parameswaran points to Freshcuts as an example. With 4,000 food items on offer, transcribing voice messages and text messages with AI will be more accurate and quicker than relying on humans alone, he says. That accuracy and speed will enable Baldor to grow faster and expand its blueprint beyond the four major cities it currently serves.

Still, Parameswaran says Baldor doesn’t want to be “in the business of designing models.” Instead, “accessing and training open-source models available on Hugging Face and customizing them with small data sets will enable greatest efficiencies,” he says.

Another key initiative will be connecting many touch points in the sales, manufacturing automation, and distribution cycle and converting manual processes into digital processes. “My goal for this year and next year is to link those things in a seamless way,” the CIDO adds.

Parameswaran believes his experience and plan for expanding Baldor’s digital transformation will help the company grow beyond its regional presence without losing its reputation for fresh produce and foods. “The challenge is using technology to manage the supply chain so that food doesn’t go to waste,” he says.

What is the most exciting part for him?

“To be more than a billion-dollar company in a short span,” he says. “What attracted me to come here is I’ve done a lot of enterprise work but the growth in this industry is going to be tremendous.”