Supply Chain AI Use Cases: 10 Ways AI & ML Solves Logistics Problems

Supply chain optimization keeps supply chains on schedule — even when conditions become less than optimal. Like when there are unexpected disruptions to a local labor supply, or when extreme weather events impact distribution, or when a looming medical crisis forces a company AI Use Cases for Supply Chain Optimization to rethink how it transacts business globally. Supply chain optimization helps keep your operations steady, despite potential disruptions. Companies that are using artificial intelligence do not have to suffer from inventory overstocking or missed responses to trends.

Existing ships of the company use algorithms to accurately sense what is around them in the water and accordingly classify items based on the danger they pose to the ship. ML and AI algorithms can also be used to track ship engine performance, monitor security and load and unload cargo. Machine Learning serves as a robust analytical tool to help supply chain companies process large sets of data. A steep scarcity of supply chain professionals is yet another challenge faced by logistics firms that can make the supplier relationship management cumbersome and ineffective.

Industry Solutions

This is perhaps because of how people buy and engage with the brands, which have recently witnessed an extraordinary shift. There are examples of artificial intelligence being used to achieve these goals. For example, an online movie platform can prepare a recommended list for users based on their profile and previous behavioral patterns. The government and social sector are using artificial intelligence to predict service needs and map usage patterns. The most influential artificial intelligence is often that which we do not see, but which impacts virtually every aspect of our lives. In addition, many organizations underestimate the time and effort that will be involved in ensuring data quality and availability when transitioning to an AI-based solution.

Currently, the company’s main tech stack includes cloud computing, robotics, AI, and IoT. Ocado also put much effort into fraud detection using machine learning technologies. The company has built its custom route optimization platforms to always deliver fresh groceries. Optimized warehouse operations are impossible without data analytics and machine learning.

Why Deep Reinforcement Learning makes sense for supply chain optimization

Nelson leads global business development efforts within ShipLilly and has been featured as a logistics expert in numerous publications, including SupplyChainBrain, The Bulletin Panama, Logistics Management, and the Miami Herald. There is a broad range of categories of artificial intelligence; hence, its application can be complex. Many verticals are currently incorporating artificial intelligence to great effect. According to Accenture, artificial intelligence involves automation, augmentation, and innovation intelligently. These 3 concepts are at the heart of our understanding of artificial intelligence. The Association for Supply Chain Management is the global leader in supply chain organizational transformation, innovation and leadership.

By partnering with third-party AI vendors, supply chain businesses can move away from the cumbersome old model of waiting for legacy platforms to catch up with new technologies. The most successful businesses will be those that apply scalable, easily integrated solutions to their existing processes. Adopting AI in supply chain management can help uncover the performance of inventory across various channels and sellers and identify anomalies, like delays or low inventory levels. With detailed inventory data, enterprises can adjust their inventory strategies to operate more efficiently.

End-to-end transaction visibility

These tools reduce processing time and facilitate smarter, faster decision-making. AI provides a view into market trends and even weather patterns that might impact operations, and that data can make all the difference in maintaining strong customer relationships and industry credibility. Having a view into when, where, and why bottlenecks occur can transform a company’s workflows and radically improve a supply chain company’s profitability. According to McKinsey, 61% of manufacturing executives report decreased costs, and 53% report increased revenues as a direct result of introducing AI in the supply chain. Further, more than one-third suggested a total revenue bounce of more than 5%. Some of the high impact areas in supply chain management include planning and scheduling, forecasting, spend analytics, logistics network optimization and more.

• Supply and demand planning goes well beyond the retail and manufacturing industries.
• Also, by constantly learning over time, it continuously improves on these recommendations as relative conditions change.
• Identify usability issues, discuss UX improvements, and radically improve your digital product with our UX review sessions.
• We help you digitally transform and scale your business through the power of technology and innovation.
• This can help warehouse managers prevent inventory shrinkage more effectively.
• Unfortunately, the supply chain generates too much data, complicated to store and analyze.

As more functions are outsourced and supply chains become more complex, traditional approaches to keeping track of product movements are unable to keep pace. We’re designing models to help make supply chains more responsive, intelligent, sustainable, and automated. Blockchain is a powerful technology, and when used in conjunction with AI and IoT, its power is dynamically enhanced.

Computer Vision

You can also monitor the temperature inside your warehouse to avoid fire incidents in case of high temperatures. Digital transformation in logistics helps you with everything from determining which routes your trucks should take to how quickly they should travel along those routes and when they should arrive at their destination. Sudha N Bharadwaj is the former lead writer for Logistics and Supply Chain SBU at Gramener. An experienced journalist, Sudha has an abiding interest in new and emerging technologies.

They use sensors to help them dash around the warehouse via a fixed path, transporting materials and delivering goods. In 2020, more than 15% of US retailers say they experienced at least 3% inventory shrinkage. For example, you can start with optimizing your product localization and identification. In fact, autonomous vehicles could also contribute to increasing safety on the roads, with human error being the cause of 94% of serious vehicle accidents. This first example that illustrates the application of AI in the supply chain comes from trucking.

How Advanced Analytics Can Support Supply Chain Decisions

Lightweight ML machines collaborate with humans to carry out repetitive, hazardous, and complex tasks, typically in warehouses. Picking, packaging, assembly, and quality control can be optimized, especially when combined with cameras. The analytics platform receives information from devices and provides you with a quick picture of the cargo in transit. In this way, you can uncover inefficiencies and logistics blind spots and improve them. This is a cargo monitoring platform, available for web and mobile, that tracks your cargo in the air, on land, and at sea. Moreover, it tracks the location, condition, and temperature of cargo during the journey of your products.

The company turned to IBM Sterling Supply Chain Business Network to help standardize and centralize its supply chain operations. By using IBM Sterling Delivery Transaction Intelligence with Watson , Anheuser-Busch, Labatt Canada is able to focus on anomaly detection. The ultimate goal ismanaging by exceptions– having such uniform consistency across a product line that it then only becomes necessary to monitor the rare problem. How fast can your supply chain respond to change, whether customer demands, competition or supply disruptions? Supply chains of the past focused on network design — warehouse placement and the distribution fleet. Today optimization is key to building competitive advantage and protecting the brand, with a focus on execution-oriented applications and real-time decision support.