AI
Companies Use AI Tools for Real-World Supply Chain Improvements
By Xavier Roxy
March 27, 2024
Generative AI is revolutionizing the logistics industry by providing a new level of efficiency and accuracy in managing supply chains. This cutting-edge technology can process large amounts of data, make predictions, and respond to queries with a human-like voice.
The emergence of generative AI in late 2022 has sparked interest across various sectors from law firms to manufacturers. The initial stages have seen its application in accelerating decision-making processes, software coding, and report writing for businesses. Logistics operators have begun utilizing this technology for creating chatbots that perform customer support roles like tracking shipments or booking loads.
Celonis, a German software company, is collaborating with a snack food supplier that employs generative AI to merge truckloads resulting in reduced shipping costs and quicker delivery times. Previously manual evaluations such as weather conditions affecting shipment consolidation are now handled by the AI system. Alex Rinke, CEO at Celonis stated that this implementation significantly decreased manual interventions by 80%, leading to corporate efficiency through cost reduction, emission decrease and timely deliveries.
Furthermore, another firm uses generative AI for comparing contracts with suppliers against final bills ensuring they capitalize on all possible rebates or discounts - an operation previously demanding extensive time due to manual review of contracts.
Despite these advancements however it’s important to note the limitations of Generative AI - namely its dependency on quality training data which if inadequate could lead to incorrect responses.
Matthias Winkenbach from MIT's Center for Transportation & Logistics shares similar sentiments explaining how current limitations confine usage to isolated pockets within supply chains limiting risk exposure should something go wrong.
As companies continue exploring ways to further integrate machine learning tools into their operations there’s hope that future improvements will allow broader use cases such as order management or tracking suppliers
Uber Freight division along with FourKites –a startup specializing in real-time freight shipment tracking–have developed chatbots enabling shippers to ask questions about their logistic operations conversationally improving speed and ease of decision making. Uber Freight is even building the capacity to provide cost reduction and shipment speeding recommendations for shippers.
FourKites’ chatbot can answer queries about delivery delays in a conversational way, helping businesses make rapid decisions. German conglomerate Bayer has been using this program to navigate disruptions in the Red Sea due to attacks by Houthi rebels on containerships, forcing many carriers and shippers to re-route their shipments.
This innovative use of technology allows companies like Bayer to keep track of their shipments heading towards manufacturing plants amidst changing shipping decisions enabling better production planning.
In conclusion generative AI holds immense promise for logistics operators offering increased efficiency, accuracy and speed. Despite some current limitations its continued development looks set to revolutionize supply chain management across industries.
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