The emergence of AI (Artificial Intelligence) has been transforming several industry verticals including the supply and logistics industry. The modern supply chain is a complex and fragmented system, and AI technologies hold the key to streamline it. Technologies like AI, machine learning, and IoT will bring about unprecedented changes in the global logistics and supply chain ecosystem by enabling automated decision making, reducing cost, saving time, and by increasing productivity.
AI helps streamline warehousing operations like inventory processing. It helps get useful insights from the data collected from logistics and supply chain, which in turn, can be used to streamline the entire logistics and supply chain ecosystem. Autonomous vehicles are another important offering to the supply chain and logistics industry from AI. Besides making driving safer, high-tech driving helps increase efficiency and lower fuel consumption.
AI and Big Data can help the logistics industry optimize future performance by accurate demand forecasting and capacity planning. When market expectations are predicted and tapped accurately, it goes a long way in bringing down operational costs. This, in turn, will help improve different areas of the logistics and supply chain ecosystem. The growing need for greater visibility and transparency in supply chain processes will increase the adoption of AI in logistics and supply chain ecosystem in the coming years.
Fueled by all these factors, the adoption of AI in logistics and supply chain ecosystem is growing at a rapid pace. Various companies are undertaking huge investments to improve their logistics and supply chain. Amazon is a pioneer in this field. The company is to launch an all-electric Prime Air drone by 2020 for the autonomous delivery of packages.
The e-commerce giant Alibaba is also gearing up its efforts to leverage AI for logistics and supply chain management. Companies like FedEx and DHL are testing and developing robotic-based systems. DHL has invested about $300 million to modernize its warehouses. The retail industry is also adopting robots for various applications, while companies like Rolls-Royce and Waymo are introducing driverless trucks and ships to speed up the delivery process and optimize routes.
In 2018, the global AI in logistics and supply chain ecosystem was estimated as USD 1.7 billion and in the coming years, the market is expected to register huge growth. The Asia-Pacific and North America are two important regions that are going to play a crucial role in the global AI in logistics and supply chain ecosystem. However, limited number of AI technology experts can restrict the adoption of AI in logistics and supply chain.
Companies like IBM, Amazon Web Services Inc., Google, Oracle Corporation, Facebook, Alibaba, Baidu, SAP, and Tencent will play an important role in increasing the adoption of AI in logistics and supply chain ecosystem, and thereby bring about efficiency in supply chain management and improve customer service and satisfaction.
Check Related Articles: