How the Zscaler Zero Trust Exchange Makes Divestiture Seamless, Easy, and Secure for XPO and Its Spinoffs

When thinking about logistics and the trucking industry in particular, technology probably isn’t the first association that comes to mind. While trucking has been around since shortly after the advent of the Model T in 1905, it hasn’t had the level of technological disruption and innovation that we’ve seen in other industries. But that’s changing rapidly.

Digital transformation in the logistics industry

Logistics and freight transportation is essentially a network business. I compare it to Uber because Uber is a network business, too. It matches customers who want to go to a particular destination with drivers. Just as technology has transformed passenger transportation, it is also transforming freight transportation by increasing freight network efficiency through the use of artificial intelligence and other advanced tools.

Even so, the industry isn’t yet fully digitized. For example, much of sales and customer operations work is done—for lack of better words—in an old-school way. We still have customer service representatives across Asia, South America, and Europe who make and receive phone calls as they manage pickup and delivery schedules, routing, dispatching, and billing.

Here at XPO, we’re working to optimize and support these customer service representatives with technology designed for a distributed world. Digital transformation is happening, and we are on a fast track to becoming a 100% cloud company. In fact, our CEO was previously our CIO. That should tell you about the direction we are headed as a company and where we see the industry going in the not-too-distant future.

XPO is investing heavily in technology. By the end of next year, we plan to completely shut down our data centers and become a 100% cloud company. As part of that cloud transformation, XPO deployed the Zscaler Zero Trust Exchange to meet our need for a security service edge (SSE). Zscaler not only satisfied our intended use cases, but also provided a number of unforeseen benefits.

Divestitures made simpler

In the relatively recent past, XPO was a big conglomerate with close to $30 billion in revenue and over 100,000 employees in 30 countries. In 2022, XPO sold its intermodal division, which provided rail brokerage and drayage services to 48 locations, to STG Logistics. Since then, STG has divested into a number of smaller companies, two of which went public almost immediately after the divestitures: RXO Logistics and GXO Logistics.

It was clear to us prior to deployment how a cloud native zero trust platform would be used to onboard and federate an acquired company by providing immediate and secure availability and access to the company’s applications instead of requiring cumbersome network integrations. What was less obvious to us was how this platform would make the process of divestiture easier as well. But it certainly did. Here are the benefits we experienced from having Zscaler in place throughout the divestitures at XPO:

No transition pains

Zscaler Internet Access enabled segmentation of public SaaS applications based on user identity. We were able to simply deploy Zscaler policies and segment the users from there. We went from more than 100,000 people to 38,000 people with zero friction.

No change in security posture

You can imagine that, when divestitures are on the horizon, there are a lot of distractions. As a result, things could fall through the cracks in terms of security. But with Zscaler, we maintained comprehensive security against cyberattacks and data loss, so our security and risk posture did not suffer one bit throughout the divestiture process.

No dip in productivity

Business continuity was another benefit of having Zscaler in place during divestitures. In similar situations in the past, I’ve had to hire a dedicated security team to handle the activities of segmenting the environments. This time, I didn’t have to hire anyone. It was a seamless transition, with no impact on productivity.

No interruptions in availability

To provide perspective, XPO moves between 50,000 and 60,000 pieces of freight every day. We use off-the-shelf SaaS applications for things like finance and HR, but the core system we use for operations is proprietary technology that uses machine learning to optimize routes, onboard customers, and make real-time rate adjustments. As you can imagine, availability is everything in our business.

If we were to be down for even a single day, the problems would multiply exponentially, so the ability to access our systems is critical. Before Zscaler, outages were all too frequent and user productivity was impacted by VPN and network disruptions in various locations. With Zscaler, we never have to worry about the network edge anymore, and this is something I can’t even begin to put a value on.

The power of the platform

Looking back, the only thing I would have done differently is deployed more of the capabilities of the Zero Trust Exchange up front to really leverage its power. For instance, I wish that we’d had Zscaler Private Access (ZPA) during the divestitures because it would have made it easier to segment the networks of internal apps versus external apps. With that said, deploying ZPA is at the top of our to-do list now.

Given the complexity of the typical divestiture process and all the things that could have gone wrong that didn’t, I feel that having Zscaler in place was a huge part of that success story.

Read the case study to learn more about how XPO is benefitting from the Zscaler zero trust platform.