Artificial Intelligence (AI) is no longer just a buzzword or a futuristic technology limited to the world of science fiction. Today, it is revolutionizing every sector it touches, and logistics is no different. The major benefit of AI is its ability to rationalize and offer insights that improve the odds of achieving business goals.
How does AI influence supply chain management and logistics?
● Effective inventory management with predictive analytics
Ineffective inventory management can lead to unhappy customers, revenue loss, and impact production. With frequently fluctuating demands, traditional operation methodologies can’t comply with the requirements. Newer technologies like predictive analytics can evaluate customer needs better and reduce unnecessary inventory. The most effective way to manage inventory is to keep the retailers aware of the strongest selling items. Predictive analytics forecast trends of the most-preferred items, helping businesses meet growing customer demands.
● Seamless stock audits
Seamless stock audits are necessary for identifying any discrepancy between stock records. AI can help in stock auditing by saving time, faster data processing, and improved accuracy levels, in business processes.
● Ease of operational and cost optimization
AI is able to offer real-time, data-driven insights that reduce costs, enhance service quality, and bring down failure rates. These insights include graph-theory based predictions of optimal shipping routes, identification of traffic conditions, and predictions of possible peak hour delays. Knowledge of such factors ensures cost-effectiveness, so that delivery executives spend less time stuck on the road, and deliver more products.
● Effective decision-making around supplier relationships
AI analyzes data sets generated from supplier assessments, audits, and credit scoring to allow companies to make well-informed decisions regarding supplier partnerships.
● Transparency and seamless communication
Al helps with tracking the order status in real time. AI-enabled chatbots have reduced customer response times to a minimum and decreased the need for logistics companies to hire in-person customer support representatives. Chatbots can also be used to place purchasing requests, answer procurement-related questions, and communicate with suppliers regarding governance and compliance materials.
Starting with inventory management and seamless communication, innovative technologies for improving supply chains can go a long way in the logistics industry. Some warehouse operations are also being integrated with augmented guidance, robotic systems, and big data to accelerate inventory management.
As per a Gartner report, supply chain organizations expect the level of automation in their supply chains to double in the next five years. The number comes as no surprise considering the increasing complexity of global supply chains and the skyrocketing expectations associated with an increasingly digital world. The pressing need for zero-error processes and high-speed deliveries has reinforced the demand for AI in the logistics industry — a need that will only grow in the years to come.
Logistics companies are also making great strides with the process of supply chains by making AI affordable and accessible to leverage the technology in transportation. In the near future, AI will set a new standard of efficiency across supply-chain and logistics processes. The game is changing quickly, creating a “new normal” in how global logistics companies manage data, run operations and serve customers, in a manner that’s automated, intelligent, and more efficient.
With H&S as your partner, you can focus on providing customers the best products, while we work on building and executing the optimal supply chain model. Our state-of-the-art technology and solutions help you improve service performance, minimize costs, deliver superior customer experiences — and scale your business to new heights.
Source:
https://throughput.world/blog/ai-in-supply-chain-and-logistics/