I’m CEO of Ocado Technology. Our advanced robotics and AI assembles, picks, packs and will one day deliver your groceries! Ask me anything!

Hi James, thanks a lot for coming to talk to us. A lot of newspapers have highlighted recently how Ocado pays drivers less than £5 an hour while your profits are skyrocketing: https://www.theguardian.com/business/2021/aug/21/ocado-drivers-paid-less-than-5-an-hour

Faizan Babar, who has been delivering Ocado groceries for more than two years, said he could not afford to take his two young daughters on holiday this year or replace their broken scooter. “I’m making on average £50 on a 10-hour shift. And we pay for our own cars, tax, fuel and insurance out of that. It works out less than £5 an hour. Ocado is treating us like dirt.”

What is "life at a global tech company" for all these drivers and what is your plan to improve the work conditions and salary for all workers at Ocado?

Hi, thanks for your question.

The article you link to contains a number of significant factual errors. You’ll note at the top of the Guardian article it now says that “This article is the subject of a legal complaint from Ocado” - which is from Ocado Retail Ltd, our JV retailer, so I can’t comment on the specifics of the article at the moment.

What I will say however is that we have a long and proud record of looking after our grocery delivery drivers, our “Customer Service Team Members” as we call them. They are much more than just drivers, they are the only Ocado employees our retail customers will meet, and they represent the amazing customer service we offer.

To my knowledge we have always paid our drivers significantly more than minimum wage, and offered benefits packages well above market norms (e.g. inc. share options, health insurance etc). They do a very difficult job and they do it brilliantly. All colleagues also benefit from our union recognition agreement with USDAW.

A very small number of our deliveries (<1%) were until recently carried out by a third party. These delivery arrangements were on a ‘fee per delivery’ basis. Driver pay varied depending on the acceptance and fulfillment of jobs, and the average driver pay for these deliveries was approx £12 per hour, above the London living wage of £10.85 an hour.

Since this article was published we have offered all of these drivers a job working for Ocado as employees on the terms I mention above.

Does Reddit reach out to companies for advertisements like this, or do companies reach out to Reddit?

How many posters here are going to be employees or part of the marketing team?

Do faux, grassroot internet efforts like this actually work?

So many questions.

🤔

Hi, I’m personally writing the answers to all the questions, but I do have some help from our comms team who are fact checking me, keeping an eye on incoming questions and keeping me on the straight and narrow!

This is not sponsored at all. A Tom Scott video on our automated warehouses went viral in July: https://www.reddit.com/r/videos/comments/oe97r8/how\_many\_robots\_does\_it\_take\_to\_run\_a\_grocery/

We saw hundreds of great questions in the comments section and thought we could have a go at answering some of them here.

I barely trust humans to pick my groceries as most people know little about what good quality groceries are. In particular, fresh produce. How can your AI do the job reliably without a sense of smell and touch? It's very interesting and exciting stuff. Good luck!

Thanks for your question.

In terms of the quality of the products that go to customers, we have a few different approaches.

Firstly, unlike a store we don’t have to deal with customers who have prodded and poked the produce before you’ve got there. Our automation is generally pretty kind to the produce so we keep damage in our facilities to a minimum.

Secondly, we have a tight feedback loop with customers, so if there is a quality issue with a particular supplier we can act on it quickly.

Lastly, as far as our UK retail business is concerned (I can’t speak for our other clients) there’s a huge focus on the quality of product that comes in to us. We can give the suppliers live data above, we can sample on the way in, we can audit and sample everything at various points in our operation, and we can audit the suppliers themselves.

At the moment we are not focusing on using AI to recognise e.g. a good mango. We want them good on the way in and we want to avoid doing them any damage while they’re in our hands.

What will your company do to protect the end user's data?

Thanks for your question.

There are some complexities to this answer, but in general our model is one where the platform that we are providing to each of our 10 clients does not store their customer databases - our clients own and store that. If customer personally identifiable information is ever ‘at rest’ in our platform, it is encrypted and we do not have direct access to the key. Our clients maintain their own customer databases using technology they have procured, and feed us the information we need as we need it in order to orchestrate deliveries to their customers.

This obviously does not guarantee end to end security, but it is a good model that makes accountability for protecting consumer data very clear.

If you are a customer in France at the moment, and you are shopping on Monoprix’s online shopping service, your data is owned and stored by Groupe Casino themselves.

In my experience, the three biggest issues with online grocery shopping are -

1) While getting a box of Cheerios is easy enough, produce is frequently hit-and-miss. Unripe or limp or a dozen other problems. If people buy groceries online how do you ensure the produce is still good?

2) Inventory management. Every time we order groceries online we are called back by the grocery store with a list of things that are out of stock or have to be substituted. How do you ensure inventories are always 100% correct, particularly for meat, fruit & vegetables?

3) Expiry dates: It seems like when we buy groceries online - Particularly meat - Almost everything we get is within a day or two of its expiry date. This becomes tiresome if you don't have a lot of freezer space.

Hi, I’ll try and do a few quickfire responses to these!

Product quality
I’ve given an answer on product quality here. Our model based on warehouses without customers has a number of advantages here.

Inventory management
You’ve hit upon one of the biggest problems with online food shopping the way many retailers do it (the ones not using our warehouse platform!)

They will generally pick online orders from their stores. This means they have no idea what inventory they have at any given time - customers are wandering around putting things in their baskets. Therefore, when you shop online, the retailer will just show you that everything is in stock and work it out later whether it was or it wasn’t. Often this leads to lots of substitutions and sometimes entirely missing items.

Our model is different - by picking from automated warehouses we know exactly what we’ve got on the shelf (or will be put on the shelf) at any moment in time. Our websites and apps show you real time availability. If another customer buys something it won’t be available for you to buy, and you’ll know that upfront rather than being surprised on the day.

Occasionally something will go wrong - e.g. if a supplier doesn’t show up, or if they do and the quality of the product isn’t up to our standards. So we do have the occasional substitution, but using our platform they’ll be much much rarer than via a store based method.

Expiry dates
I’ve covered this a bit elsewhere here in the context of food wastage, but our model lets us track the expiry date of every single product in our system, we consolidate a lot of demand and with a shorter supply chain generally we’re getting food to customers homes the same time it would have arrived at their local store. For a store based picking model you are somewhat at the mercy of the picker shopping on your behalf, and they may get to a shelf where other customers have already taken the fresher items. That can’t happen with our warehouse platform.

How much did you pay for this AMA?

Hi, this is not sponsored AMA. A Tom Scott video on our automated warehouses went viral in July. We saw hundreds of great questions in the comments section and thought we could have a go at answering some of them here. https://www.reddit.com/r/videos/comments/oe97r8/how\_many\_robots\_does\_it\_take\_to\_run\_a\_grocery/

How do you respond to the typical "you're taking jobs from humans" question?

So far, for every single year in our twenty one year history, we’ve created jobs for humans each year. And I expect that to continue for a long time to come.

The mix of those jobs is changing over time. In our more recent years we’ve had a higher proportion of jobs that are e.g. technologist or maintenance engineers.

Getting a bit philosophical for a moment, it is true though that we are in the business of using technology to make humans more productive - i.e. needing fewer human hours to complete the same task. From the industrial revolution onwards, we are just one of a long historical line of commercial organisations doing this, and overall my personal view is this endeavour has created significantly better outcomes for all of humanity.

We are hiring across all of Ocado Group at the moment. Wherever you may join us there are opportunities to learn and develop. A lot of my team in Technology started out in (for example) our warehouse operations, and have since retrained and now run significant parts of engineering or product management in Technology.

How does your technology reduce food waste?

Do you have any technology you want to introduce to achieve similar goals for in-person shopping?

Thanks for the question. We have a number of approaches to reducing food waste - from the factory through our own supply chain all the way to the customer’s kitchen.

All together, these allow a food retailer to have a significantly lower food wastage via their online channel using our platform than a traditional store business can achieve.

Our own retailer in the UK (ocado.com) has food wastage of just 0.4% of sales - a fraction of a traditional supermarket which is usually around 2-3%.

Our technologies include:
- Sophisticated ML-based forecasting that, given we have complete knowledge of every item of food in our supply chain allows for unprecedented accuracy in predicting what consumers are going to order
- Promotions on our website that are fed live data on product availability, including what’s going to go out of date soon so can be upweighted in the customer’s basket
- Strict warehouse control maintaining ‘FIFO’ of stock so there’s no ‘picking fresher items from the back of the shelf’
- Providing our customers with real-time info on how long each product is guaranteed to last for when it arrives - so they can better plan their meals and avoid food waste at home.

I imagine the robotic storage and retrieval technology can have many different applications e.g. a legal deposit library for books https://www.cam.ac.uk/ElyStore what are the more unusual (non-supermarket) applications that you are considering?

Hi, a good question, thank you.

I think there are a fair few of our technologies that could have potentially much wider applications than online grocery.

That said, at the moment we think the opportunity in the global food retail industry is so big (it’s measured in trillions of dollars globally) that it is really the main thrust of our efforts, and the market within which our products are most uniquely suitable.

We do have some other businesses in earlier stages - for example we are majority owners of Jones Food vertical farming, and our Kindred.ai business unit provides automation services to apparel and package shipping businesses.

I think you can expect to see us popping up in other places in the coming years, but I don’t have any news to add to that at the moment.

Thanks for answering even the seemingly difficult questions in this thread! I’d be interested to hear your vision on the “delivery” part of your title - the warehouse is amazing, but it still feels very controlled with human operators making sure it behaves correctly.

How do you see the future of delivery managed by robots without some kind of human intervention along the process?

Hi, no problem, it’s been fun.

You’re correct there are still a lot of humans involved in our warehouses, even the most automated processes still need supervision.

You also raise a very good question about deliveries. I think fully autonomous driving for deliveries is still a way off, but we’re doing quite a lot of work (including some investments and partnerships) to look at how the delivery experience will work if we didn’t have a driver in the vehicle. As you say it will be quite different - pre-pandemic in the UK we were known for bringing the food right the way into your kitchen. In the future, if you (say) live in a block of flats in London and we have an autonomous vehicle, what are we going to do, push message you to say come down and unload our vehicle, where your order is in there amongst 30 others? That would be quite a change in service.

I can’t say too much about what we’re working on, but needless to say we’re working on both vehicle design and in time elements of ‘curb to kitchen’ automation. In the short term though we’re doing trials with a couple of AV partnerships (Oxbotica and Wayve) to see for ourselves and learn what the future of food delivery might look like once this technology has reached maturity.

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So far, for every single year in our twenty one year history, we’ve created jobs for humans each year. And I expect that to continue for a long time to come.

The mix of those jobs is changing over time. In our more recent years we’ve had a higher proportion of jobs that are e.g. technologist or maintenance engineers.

Getting a bit philosophical for a moment, it is true though that we are in the business of using technology to make humans more productive - i.e. needing fewer human hours to complete the same task. From the industrial revolution onwards, we are just one of a long historical line of commercial organisations doing this, and overall my personal view is this endeavour has created significantly better outcomes for all of humanity.

We are hiring across all of Ocado Group at the moment. Wherever you may join us there are opportunities to learn and develop. A lot of my team in Technology started out in (for example) our warehouse operations, and have since retrained and now run significant parts of engineering or product management in Technology.

How have you recovered from your London facility's fire a few months ago? How has the system been refined to prevent further incidents?

Thanks for the question.

On the specifics of the fire in London in July - the facility in question was back up and running with reduced capacity within about a week, and then over time we have been ramping back up to full capacity.

Only about 1% of the ‘grid’ (automation equipment) was lost in the fire, so the majority of the damage and recovery was actually water damage caused by the sprinklers that contained the fire.

This is the second fire in one of our facilities, the first was in February of 2019, which had a very different result, with the fire not being contained, us losing the building, and that operation being out of action for approximately two years (it is back up and running now!)

We learnt a very significant number of lessons from that first fire - and put a lot of mitigations in place. It was these mitigations that meant we had such a better outcome this time.

We aren’t stopping there, we have a number of new improvements to make based on lessons from this new smaller incident. A number of these are about reducing the probability of there being any incident in the first place, but given we can never eliminate this entirely, also focus on making sure we reduce the risk to individuals to a minimum (always our first priority) and getting operations back up and running again as soon as possible.

You’ll have to forgive me for not listing out the precise product changes we have made, and will continue to make, they’re mostly within elements of our IP that we are not able to talk about publicly.

Do you think you pay enough taxes both personally and as a company?

As a company, we have made a cumulative loss over our history, we have reinvested any operating income into further technology development, so have not yet paid any corporation tax.

Our investors have provided capital to fund the business and have not received a dividend or any direct return on capital in that regard. We have of course paid employment taxes, property taxes and rates, VAT etc.

Frankly whether the tax mix and burden on the business is ‘correct’ I don’t feel qualified to have an opinion on. I sleep well at night in terms of Ocado’s overall contribution to society, creating tens of thousands of jobs and in the UK in particular, a relatively rare successful public technology company that’s operating on the global stage.

As for personal taxation - I can obviously only give an answer on behalf of myself and my own personal situation, but personally I think I have the capacity for and would not object to paying more tax where the government has good justification for further expenditure.

From the video I did not fully understand how it works. So the bots are going around on top picking up groceries. Then what? Do they carry one grocery at a time? Like where do the groceries go before they reach the packing arm robot?

I see someone has already linked the Gadget Show video below. I think that's as good a guide as I could do with words as to how our system works. But in short, the 'bots with wheels' that you have seen move boxes of groceries, and part-picked customer orders, to pick stations where today, the majority of items are picked and packed by a human.

You'll also see in the video what some of our newer stations look like where the picking itself is done by a robot arm.

Ocado keeps wanting to be a tech company but it keeps leaking its top talent. Are you not worried?

It's a very relaxed place to work, very little stress or pressure, but comp is crap which means you're attracting and keeping people who are happy keeping a lower salary but who're also inefficient and their job.

Ocado could do what it's doing with half its workforce, if only it was paying like a real tech company and hiring competent, dedicated people.

Hi formerocado,

In terms of ‘leaking top talent’ - it’s true of course people do leave us. We had a period during the peak of the pandemic when that wasn’t true, but as the world has opened up our retention rates have returned to more or less their long term average. Our retention rates suggest that the average employee would typically spend 6-7 years with us. I’m not entirely sure how that would rank us in the wider tech industry, but I know it’s not terrible.

I don’t agree our ‘comp is crap’ - but nor would I attempt to argue we are the top payers in our market. We aim to be competitive, but also offer a balance of good pay for interesting work in a good environment. Some of the approaches I’ve had over the years that would have paid me much more have come at the price of doing something much less interesting.

My own experience after a long time at this business is obviously different from your own, but personally I think we’re full to the gills with dedicated, competent people.

Can/will/should Ocado's warehouse tech be scaled down to the tiny fulfilment hub size? I know Bristol is quite small, but I'm thinking tiny dark-store type picking? Or wouldn't that make sense?

I believe Ocado Zoom warehouse is pretty small but not that automated?

Thank you!

Thanks for your question.

You’re correct, Ocado Retail’s west London Ocado Zoom service runs from a much smaller warehouse than is typical for us, and is part automated. However this initial operation which we started developing in 2016, is far from the final version of our product that will work in very small warehouses.

We now have a more fully automated version of this warehouse ready to go. Our automation technology is fundamentally very modular and will work in a number of different footprints (down to the single digit hundreds of square metres), and we can’t wait to show the world this in action. We have recently announced another much smaller warehouse that will be launched with Kroger in South Florida so we won’t have too long to wait now.

Are you pleased with some of the questions you've been getting here today?

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How do you plan to manage the animosity that most human beings feel when AI companies promote technologies that aim to replace human labor with robotics? How will people continue to afford AI picked, packed and delivered groceries, when they no longer have employment?

I think we’ve had some really interesting questions today! I hope I’ve been able to do some of them justice with my answers.

I know there is a lot of distrust around technology generally and AI in particular. As with many things in life, technology can be used for good or for ill. Speaking personally I am an optimist, and I think technology (from its earliest incarnations e.g. humans using tools, through to today), as much as it has ‘replaced’ people, has delivered, by a very significant margin, a net benefit to humanity.

That said of course, the development it has allowed has also led to a number of very serious externalities, such as the climate crisis we currently face.

I very much hope I am right that technology will continue to be, on balance, a force for good, because frankly we are likely to rely on continued technological development to be part of the solution to some of these bigger challenges such as climate change.

How do you respond to claims that your AI is really just linear regression ?

An interesting question! Something like linear regression is quite clearly within the definition of Machine Learning - and I know it some companies do throw AL/ML around when they’re doing nothing more advanced than that.

In our case, while we do use regression analysis for some applications (why use anything more complicated if this works best?) I can also assure you we use a much wider array of approaches and techniques on a gradient of complexity covering supervised, unsupervised and reinforcement learning.

For example, we do some pretty advanced R&D in deep RL, see here for two slides about Ocado in stateof.ai 2021, including work on using deep reinforcement learning in production to learn to scan: https://www.linkedin.com/feed/update/urn:li:activity:6853676823461576704

I feel like the consumers who would benefit the most out of this would be old people who cannot easily get out of their house to go shopping. Is there any investment on that side to make this kind of shopping more accessible to that kind of population?

Thanks for your question.

A lot of our customers use us for convenience, but we also absolutely have customers in the UK who are elderly or for some other reason in their lives are less mobile and our delivery service is a very important one for them. This was especially true during the early days of the pandemic where the number of people who couldn’t or didn’t want to go to the supermarket increased exponentially.

The front end part of our platform allows customers to add multiple delivery addresses, and arrange to place orders on behalf of those who can't use the technology for whatever reason.

We also put a significant amount of investment into making our user interfaces as accessible as possible, and indeed in some of the countries we operate there is strict regulation that ensures this is the case (which I personally think is a good thing).

What steps are you making to reduce and reuse packaging waste?

In terms of packaging on the products that are sold through our platform, this is generally a question for each of our client retailers.

In a general sense our model (warehouse based) allows for significant changes to product packaging. For example, appearance and the ability to stand out on a shelf could be limited to the online image, and different packaging could be used for the products in the warehouse.

However, online food is still a small part of the global food industry, so generally packaging trends are set by manufacturers who are still primarily thinking about the store experience.

Our UK retail client/JV Ocado Retail (ocado.com) is a signatory to the “UK Plastic Pact” along with some other retailers, and has committed to reduce its dependence on plastic and use 100 per cent recyclable packaging for all own-label products by 2023.

Any chance of carrier bag free deliveries or are the plastic bag liners non replaceable ?

Hi. The use of carrier bags in online food deliveries is a more subtle debate than sometimes gets discussed.

Firstly for Ocado deliveries in the UK, as mentioned below, we operated a closed loop system where we take bags back and turn them into new bags.

But why use bags at all? - is the usual, and completely understandable response. Well, from a sustainability point of view we are optimising for a number of things . Another thing we care about is keeping the number of our vehicles on the roads to the absolute minimum - reducing energy usage and carbon emissions. By removing bags altogether, we would reduce the number of possible product tessellations (taintable product cannot be put in the same delivery box as products which taint, unless they are in separate bags), so would need more delivery boxes on more vans. Additionally the doorstep delivery will take longer which will also reduce routing efficiency.

We have modeled/simulated this on multiple occasions, and to remove bags would reduce some plastic waste (our closed loop scheme does have some bags that don't make it back) but would increase carbon emissions.

It's a difficult trade off but at the moment we think we're making the right call, as much as the pressure from the single issue of plastic waste suggests otherwise. This may change in time as we come up with other solutions, or perhaps through more direct regulations in some of the countries where our platform operates.

How is the human involvement on your side? You have robotics and AI but obviously there will need maintenance on the robotics and food delivery to the warehouse.

How comparable is it to a normal food warehouse who only use humans?

Great question.

You are correct, we have lots of maintenance engineers in our operations. We obviously try to make our equipment as reliable as possible, but our bots and other equipment does need attention from time to time - whether that’s routine maintenance like changing tyres, or occasional brain surgery when something goes wrong with an electronic component.

Our maintenance engineering workforce is highly skilled and truly global in nature, in the coming years Ocado Engineering will have several thousand engineers in the team, with roles from California to Japan.

In terms of comparisons to a fully manual warehouse that only uses human labour, the total number of people will probably be similar, but the operation will do much more sales in the same footprint, and obviously the mix of employment on site will be different, with fewer operatives and more engineers.

So what’s life like at a global tech company? I use to for a big supermarket in the uk, both in the distribution centre and in store (a store that does deliveries) and just found it too frustrating to work for. Every idea I had to help us work better/easier was just met with “that’s not the [name of company] way”.

While we did originate from, and do still part-own a ‘supermarket retailer’ (i.e. ocado.com), vs the supermarkets I know about in the UK, I am quite confident that our culture is more akin to a tech company and always has been.

Traditional supermarkets are long-running, very successful businesses that have evolved over the past 100 years. They can be, by their very nature, conservative in their decision making, and may not be quick to change what they perceive isn’t broken.

Ocado was founded as a disruptor. We have always been, behind the scenes, a technology and logistics business as much as we were a retailer.

One of our three central values is ‘we can be even better’. We are not afraid to invest in the thing that will replace the thing that we’ve only just built and works quite well. Sometimes we do that before we’ve got the first version live! Innovation is in our DNA, and if you want to try something new you don’t get very many ‘that’s not the company way’ type answers to questions.

I’m really interested to hear about your experience. As someone who stumbled across this business very early in my career, I feel quite lucky to have ended up in this environment.

Hi James, I am working in logistics as an RDTM (having been a CSTM for 3 years). However, I would like to work in technology, specifically in the advanced technology team as I am particularly interested in automotion of vehicles and warehouses. For personal reasons, I didn't end up going to uni (where I was hoping to study CompSci w/ AI). Do I need to go back to uni and get a degree to join the advanced technology team, or is there a way I can work my way up? Who should I speak to regarding this?

Hi Autonomous-CSTM!

I’m not going to pretend that having a degree isn’t a good way in to working with us, but you definitely don’t need a degree to work in Technology. I’m not going to name names but we have people in very big jobs running significant teams who do not have a degree - they’ve started in one of our operations and have learnt what they’ve learnt on the job.

I can speak from very personal experience here. I used to run one of our warehouse operations in Welwyn Garden City, and I can name multiple people who joined us picking on the night shift and now work in our robotics R&D facility in the same city.

There’s a general answer that we post the vast vast majority of our roles internally first before we hire externally, so watch out for the job board. It’s possible that something in testing or QC may be a good entry point if you don’t have a technical qualification. However, as you work for us, and you know who I am, then please drop me a slack message or email and I’ll put you in touch with someone!

What efforts are you making to keep humans in the loop with your autonomous systems?

At the moment it’s not so much that we need to make efforts to keep humans in the loop, more that it's necessary as part of the operation of these systems and as a way of helping improve the AI.

One of our robotics products (Kindred.ai's SORT system) uses human teleoperators to take over, and assist when a robot cannot complete a task. I think this is a template that will accelerate the adoption of robotics for more advanced handling applications over the next decade.

One robot operator can assist many robots from our fleet of 250 US based robots that are sorting apparel for some of the best known clothing retailers in the world.

If your question relates to safety generally, even our most autonomous software has a number of fallback safety systems, usually hardware based. For example our hive software that routes all of our retrieval robots also has a separate system that can kill power to all bots via a physical relay if something goes wrong (and this safety system can be activated by either a human or other software that monitors the health of our operations).

What are the most difficult items for computer vision to distinguish and robot hands to pick up?

One of the biggest challenges is the sheer breadth of items - from a pack of stamps that weighs just a few grams, to a bag of dog food that weighs 15kg.

In terms of grasping, there are a lot of things that manufacturers do which are good for humans, but not well optimised for robots - for example square boxes that are densely packed together - it’s hard for the robot to perceive them as individual items and then to grasp them. Lots of human grasping strategies are not available to a robot - for example, a robot can’t use its fingernail to drag something out of a box for a better grasp.

Plastic packaging is hugely challenging for computer vision as it is generally transparent. It presents a challenge for robotic manipulation as it is typically on top of packaging that needs to be preserved.

The CEO Of the Ocado Group makes 3.7 million USD. The Rest of the executives listed make well above a million. I think it's reasonable to assume your salary is a million USD.

You have stated as fact that you pay your drivers "significantly more than minimum wage" but chose to hide the exact number. Let's say, for the sake of argument, you pay them double the UK minimum wage, which in USD would be 41k/yr.

That means the ratio of pay between you and a driver, even if they get paid DOUBLE the minimum wage, is 24:1.

One of the primary benefits of your tech to your shareholders will be to reduce labor costs, thus putting more people out of work.

My question is twofold:

1. Can you explain what you do with your day that makes your labor 24x more valuable than the people actually doing the work of getting the food to people?
2. What do you think should be done, policy-wise, at a societal level to take care of the workers who lose their jobs because of your technology and automations like it in the future?

Hi, thanks for your question.

Our rates for our CSTMs are published publicly and are union negotiated. They vary by location and it would be a lot to post here, but any one of our job adverts lists the pay rate and other benefits.

I am not an executive director of Ocado Group so my compensation is not published, but I earned less than anyone mentioned in the annual remuneration reports you are referring to.

The ratio you have calculated is off, but to your general point, the ratio is going to be the same order of magnitude (i.e. >10x) as the one you have calculated.

The first part of your question about what makes a day of my time more valuable than a day of someone else’s time, I only have a general response to that - the principle of different pay rates for different forms of work is fundamental to how (most) economies work. Personally I believe that the incentive structure which encourages people to develop themselves to earn more is an important one. I think it’s a valid debate on how steep that pay gradient is, and in part, a progressive tax system should be used to moderate this gradient, and the tax revenues used to ensure there is equality of opportunity to access this personal development.

Your question about what happens to someone whose job is replaced by automation is one society has been grappling with for a long time. Through various forms of automation, in developed economies agricultural work is much less labour intensive than it was 200 years ago - yet few would argue humanity would be better off if most of us were still required to spend the majority of time just growing enough food to survive.

For a theoretical world where we had successfully automated all tasks that require human toil, personally I think that would be a good thing - the big question though is how will the benefits of this development be distributed.

If we look back historically one could definitely challenge how the benefits of technology have been distributed. However I think there’s a very strong argument that collectively humanity generally has been a beneficiary - if we track average life expectancy, leisure time etc, there have been ups and downs but the trend is strong.

Sorry for the philosophical answer but you are asking a big question.

An interesting opportunity here to ask a leader some questions from a company I've been following on LinkedIn for a while! Appreciate your willingness to share, James.

I have been exploring global career options in England as a Canadian citizen. Recently I learned that Ocado is indeed global with a development centre here in Toronto. I am wondering how the different development centres interact, if at all. Are there projects and technologies developed by teams with members across the globe, or are the teams more localized and focused on a particular area's fulfillments? Perhaps both? If it is the former, how are solutions requiring hardware handled?

Also I am interested in how open Ocado is on employees transferring to other global development centres. I read on LinkedIn and BBC that certain staff may have the option to work abroad remotely temporarily which seems to be slightly related. What are your thoughts?

Would be great to build a relationship at Ocado and be able to ask more than would be fair for me to do here. Looking forward to reading the other answers here as well. Thanks!

Hi, thanks for your question.

I’ll explain a bit about how our ‘Dev Centres’ work. We currently have 11 of them, in 7 different countries (UK, Poland, Spain, Bulgaria, Sweden, USA and Canada).

The UK is our home base, but we don’t operate a model where product decisions are made in the HQ, and ‘code is written offshore’. Each Dev Centre will generally own a series of Products, and they in turn may have teams in other locations.

For example, we have a module of our platform that allows our clients to pick in store if they wish (as much as we encourage the warehouse model as the better one in the long term). The leadership for this product is based in our Dev Centre in Sofia, Bulgaria. Most of the engineering is done there too - although now they are also hiring some teams in our Dev Centre in London.

Our Toronto Dev Centre joined us as part of the Acquisition of Kindrid.ai, so the teams there currently form about half of our effort in Robotic Picking for grocery and other industries (such as apparel retail and package distribution).

We generally encourage our team members to move around our locations if it suits them. We don’t have a ‘you can work on any product from anywhere’ setup, in part because many of our products involve a physical setup including testing and labs, so often a move means moving to a different team/product - but people do that often too.

Honestly while we do have a fair bit of movement between locations, we don’t have as much as I’d like, so anyone who wants to join and try a couple of different dev centres through their Ocado Technology career is more than welcome!

P.S. Like most companies now, the majority of our teams spend the majority of their time working from home. We also have a 30 day per year 'work from anywhere' policy, so whatever your dev centre location there's a chance to spend a portion of your time in a location of your choice (assuming you don't need to be doing something in a lab!)

As a middle manager in another well known technology firm, I'm interested in your culture and management philosophy - could you give us some insight about that?

Rather than giving you our formal ‘framework’ of values etc (which I can follow up with if of interest) I’ll give you my own more colloquial version of our culture.

I think we have a very high density of smart people who are fun to work with, and who have a disposition to taking some calculated risks with the acceptance that we might trip up a few times before we get things right.

When that density is high, generally it’s self reinforcing as when we’re hiring we tend to want to work with more of the same.

Of those three qualities the ‘fun to work with’ part is as important as any. Speaking personally I wouldn’t have been here for more than 15 years if that wasn’t an unwritten rule of who we hire. Those who join us who are used to, and intend to continue with a ‘territorial’ style of corporate life generally don’t last long with us as our organisational antibodies are pretty strong when it comes to rejecting that sort of behaviour.

Personal leadership philosophy, to give you a bit of my current internal monologue on the subject - I try to be as transparent and honest with my wider team as possible. We’re all doing our best and none of us no matter how senior has all the answers all of the time. That sometimes trips me up, as sometimes this means being open about something where we don’t have all the information yet. It’s a balance between clarity and certainty that different people prefer to be at one end of or the other.

With already hyper thin margins in the grocery industry, how can highly expensive robotics, artificial intelligence and automation be implemented in the industry without driving consumer pricing so high as to make this entire enterprise no longer economically feasible?

Self checkouts cost about 50,000, but have good ROI after 2-3 years because they remove employees. What you've described in your intro ADDS hardware, software and more manpower to the mix.

Where's the ROI and savings coming from if stores gotta pay out the nose for your technology? Seems like the only way your whole business works is if you drive local supermarkets out of business, and replace them with huge robotic facilities with less employees.

You are correct that grocery industry margins are typically quite thin - although the quid pro quo is those low percentage margins are often on very significant, relatively stable revenue.

I am confident our platform, when used at scale, and accounting for some of the innovation we have coming down the track, can allow for a grocery retailer to achieve better margins than typical for a store based retailer - without putting food prices up. As and when that happens, depending on the competitive dynamics of the market in question, I think it’s likely consumers will see lower food prices, not an increase.

How do we achieve this? A number of ways, and it’s not all removing labour from the supply chain. There is some shifting of labour, e.g. more drivers, more engineers, fewer ‘store’ equivalent workers and of course some reduction of labour per $ of sales overall. However it is also about getting energy usage down, lowering food waste, removing stages of the supply chain (e.g. Factory->Consolidator->DC->Store->Home can become Factory->CFC->Home) and various other improvements in our model.

My answer above also includes paying for an amortising all of the capital equipment needed to run a business on our platform. There are advantages here too - our solution uses less property/land overall (when also including supermarkets DCs) and less expensive land. Stores are not cheap to build, equip and refresh.

Hello! I’m interested in the way you decide how to group food in bags. It’s seemed to change over the years from simply fridge/freezer/cupboards to grouping similar things together.

Is that human design from feedback over the years, or something that’s data driven? I’m guessing you can track wastage from e.g. people asking for refunds where eggs have broken or liquids have leaked and potentially affected the whole bag.

Hi, thanks for the question. We have a very data driven approach to what goes into each bag!

There are a few things to optimise. Primarily, the better we manage to arrange things into bags and totes (our delivery boxes), the fewer totes we use, which means fewer vans on the road, lower delivery costs, lower energy/carbon usage per order etc.

The dimensions we then have to take into account include:

- Temperature regime of the products. All ambient, chill and frozen items need to be grouped in the correct part of the van.

- What bruises and what is bruisable. We don’t want to put tins of peaches (bruiser) with fresh peaches (bruisable)

- What taints and what can be tainted, e.g. we don’t want to put a scented diffuser (can taint) with meat (can be tainted) (or raw and ready to eat products)

- The size of the products themselves and what tessellates into a bag

The data we use to optimise this includes live feedback data from our operation (we’re breaking a lot of these), data on what customers end up refunded for, as well as more specific survey based feedback from time to time.

You have correctly observed that we’ve changed our approach to this a lot over the years. This algorithm along with others that set how we load and route our vans, and how we store things in our warehouse, all interplay to keep the overall operation as efficient as possible.

Hi James! I hope all is well. I am so impressed with the work your company is doing and I would love to work for your company as a software engineer in AI/ML.

AI/ML has been a huge interest for me to work with because of the potential it can have to solve many of the world’s problems just like your company is working with to ease our lives.

I am currently a college student majoring in Computer Science so I hope I can work as an intern at your company. Is your company currently hiring for interns right now?

Hi, it’s great to read that you’re a fan of the work we are doing in the field of AI.

Yes we are hiring interns! Our applications are now open for summer 2022. We have Robotics and Software internships that could be of interest - here’s a link for more info https://www.ocadogroup.com/careers/early-careers/internships

What is daily life like for an AI engineer at your company? What qualifications are you generally looking for?

I’ve asked one of our engineers for some bullets on this!

Firstly, the job of an engineer focusing on AI generally forms part of a wider engineering effort that gets our software into production. So an AI engineer is likely to spend a portion of their day interacting with the wider team, e.g. attending daily stand-ups.

That said, an AI engineer is likely to spend a greater proportion of their time focused on data and in ‘experimination mode’ - looking to find ways to improve the key KPIs the model in question they are working on is looking to optimise.

Qualifications vary depending on the domain. A lot of our AI engineers have degrees that are heavy in applied mathematics, and the most common technical skillset is probably being able to code in python. That said there are lots of exceptions to these.

A common theme it’s worth calling out is that most of our AI engineers (in fact all most of our software engineers full stop) are working with cloud based tooling, testing and deployment pipelines. That’s more often than not learnt on the job though rather than a ‘qualification’ as such.

Hope that helps.

Hi James, for fresh graduates with masters degree in a scientific field, what are the chances that they will get hired ? Will there be more training on the job as they join ? Thanks !

We take on graduates from a range of different backgrounds but STEM degrees are definitely an advantage. There is continuous training throughout the programme and many of the skills are learnt on the job.

Our graduate roles are currently open and all the information is available here: https://www.ocadogroup.com/careers/early-careers/graduates

I used to work for Sobeys in Canada and was surprised when the partnership with Ocado was announced. How did you make that selection? Did they seek you out or did you approach them?

Thanks for your question.

The conversation with Sobeys took place over a number of years before the deal was signed and announced. In their case, they did not have an online presence before they did the deal with us, and they were evaluating the best platform to launch their online ambitions with.

I really can’t speak for them specifically in terms of their decision making process, but we are pretty much unique in offering an end-to-end platform designed around online food, and many of our clients are evaluating using us, or attempting to build this capability themselves.

There are obviously pros and cons to both - if you can pull the latter off then you’re in complete control. However, on behalf of our existing 10 (and hopefully many more future) clients, we have spent multiple hundreds of millions of dollars of R&D on our platform in the last twelve months alone. For all but the very biggest retailers this is a lot to keep up with if you want access to the best platform!

How do you feel about only thinking about making money out of stuff noone ever needed and will never need?

Also, is this sponsored? How much did you pay to spawn on top of my feed while I don't even follow this sub???

That post belongs in r/LateStageCapitalism

Not sponsored - I didn’t even know that was an option!

I’m not sure exactly what you're referring to in terms of things that no one ever wanted - perhaps the delivery of groceries overall?

Almost by definition we only build products/services that people want to use. We might experiment with some things, but if the demand isn’t there we shut them down. In the case of grocery delivery, we offer convenience and time back in people’s lives, with other benefits - e.g. lower food wastage as I already mentioned, and a range of products beyond that which you can find in a store.

In recent times with the pandemic demand for our services in the UK has far outstripped supply, our employees are key workers getting food into people’s kitchens, a key part of this country’s food supply chain.

What are your thoughts on hydrogen as a fuel?

I have a few thoughts on Hydrogen, but I am by no means an expert and there is plenty of room for me to end up being wrong with the predictions below.

I think it will have its place in our energy mix. For example there are some industrial applications where something has to be burnt, there is not an electricity based alternative that will deliver heat at a rate that combustion can. In this case, hydrogen may be a good fuel as it can be captured using renewable energy (e.g. electrolysis powered by PV or other renewables).

In terms of it being a wide replacement for gasoline, natural gas etc - I’m not so convinced. I think some of the interest in it is because some industries, e.g. oil and gas, have already mastered the art of moving flammable liquids and pressurized gasses around the world, and there’s an inclination to see a use for assets that already exist.

For the most part though I suspect that electrification and where applicable battery technology will be the better answer in general.

Even with that it’s possible that hydrogen may have a role to play in grid-wide storage (I’m sure there are plenty of companies looking at this) but as I understand it it’s far from a competitive technology for this at the moment.