Artificial Intelligence (AI) In The Supply Chain
Artificial intelligence (AI) has been around since 1956, and has been evolving ever since to become more efficient. It operates behind the scenes but is already a part of everyday life. For example, if you’ve ever been offered suggestions when purchasing goods online, then that’s AI doing its job. Artificial intelligence really is everywhere.
Despite this, AI has only recently been gaining traction in the transportation, manufacturing, and distribution industries. Software that uses AI technology to solve complex problems effectively and efficiently is being introduced throughout global supply chains. Here are some of the main areas where AI has been introduced within our industry:
- During automated processes and actions
- Assisting with human decision making by interpreting data and reducing potential man-made errors
As global supply chains become more complex, there are less margins for error. With growing competition in an increasingly connected and digital world, maximising productivity by reducing any uncertainties is vital.
AI In Action
AI is used both internally and externally by organisations to improve operations within a company’s supply chain. Internally, historical sales information can be used to identify patterns and forecast demand using intelligent algorithms. This can be used to help supply meet demand as it allows companies to better understand their customers spending habits, enabling them to accurately predict future demand.
AI Inside Distribution Centres
In distribution centres, AI is coupled to picking systems, driverless forklifts, and intelligent robots. AI-powered wearable tech such as smart glasses, watches and voice-activated headsets are more efficient than their handheld counterparts, too. Digital cameras are routinely used to monitor stock levels and to provide restock alerts when stocks get too low. AI algorithms can even forecast when orders will arrive, which means pallets can be placed ahead of time to maximise efficiency.
AI In Logistics And Transport
The transportation of goods often generates huge volumes of data. However, with the help of AI, transport companies can analyse these figures and gain a better insight into their operations. They can identify areas for improvement and reduce the margins for error across the board. This technology also makes it possible for organisations to automate load forecasting, route planning and vehicle scheduling to lower delivery times. The latest transport management systems (TMS) include AI functionality that provides real-time information from raw data which can influence key decisions. Shippers, carriers, suppliers, and consumers are all benefiting from AI-driven TMS technology.
Despite all of AI’s benefits, there are still some teething problems. Firstly, the cost and integration of AI software is significant – so much so that only large companies can afford to design their own AI solutions. Secondly, an interactive human interface is still required. There are some problems that require a human touch; even the best AI systems cannot solve everything. Managers must also be able to monitor data and even override AI decisions when necessary. Finally, although AI’s productivity increase releases people from performing the mundane and unfulfilling tasks, there are still concerns that the introduction of new technologies will result in job losses.
Now that we’ve delved into the workings of artificial intelligence in the supply chain, what are your thoughts on this? Get in touch via Twitter or LinkedIn and have your say. For more information on what we do, visit our website, and for more blogs, click here.
