Supply chain efficiency and AI go hand-in-hand
When many people think of artificial intelligence (AI), their minds race to futuristic images of machines and robots making complex decisions and doing everything from colonizing other planets to world domination. While the possibilities are as vast as our imagination, in the business world, there are already practical applications for the role of AI in the supply chain that logistics leaders are capitalizing on, whether it’s using ChatGPT to ask questions regarding demand forecasting or prompting bots to produce risk assessments. And it’s working. According to a study by McKinsey, early adopters of AI have had impressive results, improving costs by 15%, inventory levels by 35% and service levels by 65% compared to slower-moving competitors.
Whether you believe in the power of AI and logistics to unlock untapped efficiency or have doubts about its cost-effectiveness or complexity, one thing is certain—it’s revolutionizing every industry, and understanding its potential can be your secret weapon for finding efficiencies and staying ahead of the competition.
Read on to discover nine powerful ways that companies are preparing for the future of AI in supply chain and logistics management and using innovations to save costs and find logistics efficiencies.
We cover how you can leverage artificial intelligence in your supply chain for:
- Forecasting inventory levels and demand planning
- Optimizing transport routes
- Providing better customer service
- Making better-informed business decisions
- Managing risk
- Gaining enhanced visibility through transparency
- Incorporating sustainable practices into your supply chain
- Improving warehouse operations
- Leveraging robots, autonomous vehicles and drones
Nine ways that companies are leveraging AI
While insights from AI systems may seem like they’re coming from a crystal ball, behind the scenes, it’s sifting through massive datasets, uncovering hidden patterns, insights and correlations far beyond what humans can process. Whether it’s analyzing customer behaviour, market trends or operational data, AI can delve deep into the data ocean, extracting meaningful information and helping organizations make informed decisions quickly.
Here are just a few of the countless ways that businesses are already taking advantage of this powerful technology.
Challenges of implementing AI in the supply chain and logistics industry
Implementing AI into a business’s value chain can bring numerous benefits, but it also comes with its own set of challenges. According to a study by McKinsey, 47% of business executives surveyed have difficulty integrating cognitive AI processes with existing systems and 40% cite costly technology and expertise as a barrier. Here are some key challenges that businesses may encounter:
- Complexity of implementation: Integrating AI into existing processes and systems can be complex and require significant technical expertise. It often involves restructuring workflows, training employees on new technologies and ensuring compatibility with existing infrastructure.
- Unpredictable external factors: Businesses operate in dynamic environments influenced by various external factors, such as market trends, regulatory changes and customer preferences. These factors can impact the performance and accuracy of AI systems, which could make it challenging to adapt and respond effectively.
- Rapidly changing technology: AI technology is constantly evolving, with new algorithms, models and frameworks emerging regularly. Keeping up with the latest advancements and selecting the right technology for specific business needs can be a challenge. It requires continuous learning, experimentation and staying informed about the latest developments in the AI field.
- Data privacy and security: Implementing AI involves collecting and analyzing large volumes of data. Ensuring the privacy and security of this data is crucial to maintain customer trust and comply with regulations. Businesses must implement robust data protection measures, adhere to data privacy laws and have proper protocols in place to handle sensitive information.
Successfully navigating these challenges requires careful planning, collaboration between different stakeholders and a strategic approach to implementation. By addressing these challenges proactively, businesses can unlock the full potential of AI and drive value across their value chain.
How logistics leaders can leverage AI in logistics
When it comes to harnessing the power of AI in logistics and supply chain management, it’s essential to acknowledge that the technology is only as powerful as the network and systems that are in place. Business leaders must set goals and expectations that leverage deep data and ensure a robust infrastructure to fully reap the benefits.
To achieve this, you should consider flexible shipping and logistics solutions that can adapt to the demands of an AI-driven supply chain. Purolator offers a range of services designed to enhance agility and efficiency.
- Fast and flexible shipping services: Purolator QuickShip™ service provides next-day delivery by 9 p.m., seven days a week, including evenings and weekends in select Canadian markets. With Purolator’s fast shipping services across Canada and cross-border shipping between Canada and the U.S., businesses can benefit from flexible speed-to-market solutions, such as cross-border logistics and best-flight-out/just-in-time delivery.
- Optimal route and shipping methods: Purolator offers less-than-truckload (LTL) and truckload (TL) services to support various shipping volume needs. By leveraging optimal routes and shipping consolidation methods, Purolator ensures efficient transportation within customers’ supply chains.
- Convenient drop off and delivery: Purolator understands the importance of convenience in logistics. With later drop-off times and over 2,500 retail facilities, agents and Mobile Quick Stop locations across Canada, Purolator provides flexibility and accessibility to conveniently reach more customers.
- Supply chain expertise: Purolator’s shipping specialists are equipped with extensive supply chain knowledge and can guide businesses in planning the right shipping solutions. With a wide range of capabilities—including courier and industrial freight, northbound logistics (LTL), offshore inbound logistics, express services and cargo options—Purolator offers comprehensive support for various shipping requirements.
Hear what an expert has to say about the future of supply chain logistics. Learn more
- Ground shipping: For non-urgent shipments where overnight delivery isn’t a priority, Purolator offers an efficient and cost-effective alternative to overnight service. Depending on the destination, a shipment can be delivered in two or more business days, helping to reduce costs while maintaining customer satisfaction.
- Integrating sustainability and technology: Purolator prioritizes sustainability and technology in its operations. The National Hub uses battery-powered forklifts and high-albedo concrete to reduce carbon emissions. Furthermore, Purolator employs the Siemens remote underbelt unload system (RUBUS), automating trailer unloading at an impressive rate of about 12,000 parcels per hour.
Start planning for the future of AI in supply chain management
Planning for the future role of AI in your supply chain is crucial for staying ahead in today’s dynamic business landscape. As the technology continues to evolve and transform industries, integrating AI into your supply chain can unlock new levels of efficiency, productivity and competitiveness. To embrace the potential that accompanies AI, you can start by assessing your current processes and identifying impact areas.
By partnering with Purolator and embracing these flexible shipping and logistics considerations, we can help you ensure your supply chain is nimble enough to take full advantage of the benefits of AI.