Interview with Apkudo’s CEO Josh Matthews on automation and human collaboration in secondary mobile device grading and processing

While these points are valid, the dynamic between human and machine roles in this process is more complex. In this interview, Apkudo’s co-founder and CEO Josh Matthews delves into his company’s approach to automation, the interplay between human and machine, and its implications for the global secondary market. Apkudo has published a paper on their cosmetic grading process.

Apkudo’s approach to blending human expertise and machine precision

Secondarymarket.news: What are your observations from helping customers make the shift to automation for device grading?

Josh Matthews: Organizations are working tirelessly to manage the challenges of manual grading processes, and I deeply empathize with their efforts. It's no easy task, and it’s clear how much dedication it takes. At Apkudo, this understanding drives us to tackle the most complex challenges our industry faces. Human involvement in these processes is deeply personal: companies place their trust in their best team members, who are the backbone of their operations today. However, we recognize that expecting humans to perform grading tasks with perfect precision is an unfair burden. The reality is that human decision-making naturally involves some degree of bias, making it even more important to create solutions that support and enhance their work.

Secondarymarket.news: What is the biggest hurdle companies need to overcome when implementing automation?

Josh Matthews: Recognizing the subjectivity of human evaluation is challenging, but it’s a crucial step. At Apkudo, we collaborate with our customers to focus on accuracy and agreement, ensuring that human bias doesn’t inadvertently shape AI algorithms. After all, the outcomes of automation are only as good as the data they’re built on. Adopting automation is a significant investment, and it comes with the need for businesses to embrace change. This shift requires confidence in new, repeatable outcomes that drive better processes and results.

Secondarymarket.news: How does Apkudo ensure that machine-driven processes complement human expertise in grading and device processing?

Josh Matthews: At Apkudo, we believe in the synergy of humans and machines rather than one replacing the other. Our cosmetic alignment process relies on human intent to guide robotic grading. Customers’ expert graders play a vital role in training our algorithms. By evaluating a control group of devices, we ensure that our systems align with customers’ standards, delivering repeatability and reliability every time.

One important point I want to clarify is the distinction between defect detection and cosmetic grading. While these two concepts are closely related, they are not the same. Defect detection focuses on identifying cosmetic flaws or imperfections in a device, and robotics excel in this area. Cosmetic grading, on the other hand, is the process of translating the number and severity of these detected defects into an overall grade or quality score. Cosmetic grading serves as a common language between buyers and sellers. For consumers, it offers insight into the wear and tear of a used device, and, if done well, appropriately sets their expectations and helps them make informed decisions.

Secondarymarket.news: What roles do humans play in grading that machines cannot replicate and how does Apkudo maintain this balance?

Josh Matthews: Machines cannot discern human intent without guidance. Algorithms rely on human expertise for training and refinement. For instance, we moderate joint discussions with graders to define and normalize terminology for defects, such as scratches or chips. Consumer expectations are human expactations. This collaborative process helps train robotic systems to understand human intent and establish consistent defect classifications when determining a device's assigned cosmetic grade.

Refining algorithms while avoiding overfitting

Secondarymarket.news: What measures does Apkudo take to prevent overfitting of algorithms while leveraging human insights?

Josh Matthews: Overfitting occurs when algorithms are too narrowly trained on specific datasets, reducing their accuracy in broader applications. To avoid this, we use large sample sizes       with diverse defects and surfaces to train our systems. Additionally, we focus on aligning robotic systems with customer-defined grading standards rather than duplicating inconsistencies in human grading.

Addressing labor impacts and job creation

Secondarymarket.news: How does Apkudo address concerns about job displacement due to automation?

Josh Matthews: Automation isn’t just about reducing headcount—it’s about driving efficiency, improving grading quality, and enabling scalability. In many cases, displaced roles are redeployed to support business growth. For example, as the market expands, new opportunities arise in logistics, repairs, and sustainability initiatives.

Opportunities for new job categories

Secondarymarket.news: Do you see opportunities for automation to create new job categories in the secondary market?

Josh Matthews: Absolutely. Automation redefines work, making technical and engineering skills crucial for maintaining and optimizing systems. Roles focused on sustainability, such as tracking and reporting environmental impact, are also growing in importance. Additionally, human expertise remains essential for tasks like precision repairs and ensuring consistent grading outcomes.

Building trust through consistency and transparency

Secondarymarket.news: How does collaboration between humans and machines impact consumer trust in the secondary market?

Josh Matthews: Trust hinges on the quality of grading outcomes. Poor grading of devices can lead to returns and dissatisfaction, while accurate grading ensures consumers receive what they expect. Robotic grading delivers consistency and reliability, boosting trust in the marketplace.

Secondarymarket.news: What role does transparency play in Apkudo’s approach?
Josh Matthews: Transparency is critical for building trust. By eliminating subjectivity in grading and providing consistent results, we reduce redundancy and increase confidence across the supply chain. Automation ensures every device is evaluated the same way, enabling faster, more accurate decision-making.

The technical challenges of consistent grading

Secondarymarket.news: How does Apkudo maintain consistency in cosmetic grading across environments?

Josh Matthews: Robotics naturally deliver consistency, achieving repeatability far above human capability. Our algorithms are designed to address variations in customer environments. The implementation of automation is comprehensive to address customer specific standards.

Secondarymarket.news: How does Apkudo prioritize improvements in functional and cosmetic grading?

Josh Matthews: Functional assessments are generally binary (pass/fail) and quantitative, while cosmetic grading traditionally relies on qualitative measures. Our robotics bridge this gap by translating qualitative cosmetic assessments into quantitative data, ensuring balanced improvements in both areas.

Establishing standards and advancing the market

Secondarymarket.news: How does Apkudo approach universal grading standards and the challenges of alignment?

Josh Matthews: While we don’t aim to drive universal standards, we focus on delivering consistent and reliable outcomes. Customer-defined criteria guide our systems, ensuring they meet specific market needs while maintaining accuracy and trust.

Secondarymarket.news: Could you elaborate on the controlled expert inspection process?

Josh Matthews: This process uses anonymized control groups to align human graders and robotic systems. By defining defects and grading standards collaboratively, we train algorithms to reflect true customer intent, enhancing grading accuracy and consistency.

Conclusion

Apkudo’s approach to integrating automation and human collaboration demonstrates the potential for transformative change in the secondary mobile market. By balancing technological innovation with human expertise, the company addresses critical challenges while fostering growth, efficiency, and trust across the industry. In a recent blog, Mobile Klinik shared how they are using Apkudo to provide consistent results for their customers.