Strategic supply chain management is the foundation of a smooth flow of goods and thus the basis for economic efficiency and customer satisfaction. In this context, supply chains are becoming increasingly digital, as the use of innovative technologies and solutions enables the exchange and analysis of data, the automation of processes and tracking in real time. In our latest blog post, we discuss how the application of artificial intelligence (AI) as a disruptive technology supports logistics processes and can make a decisive contribution to optimizing and strengthening supply chains.
- Potential of AI for routing and transport logistics
- Artificial intelligence supports purchasing and procurement
- Warehousing solutions – AI optimizes warehouse management
- How AI supports sustainability efforts
- Resilient supply chains through AI – the benefits
- Conclusion: Intelligent supply chains through the use of AI
1. Potential of AI for routing and transport logistics
Globalization, product diversity, partner networks, regulatory requirements – supply chains are becoming increasingly complex and are divided into different sections that can benefit from artificial intelligence in multiple ways. Transport logistics in particular benefits from the integration of technology into supply chain management: Artificial intelligence significantly advances the optimization of transport routes. The resulting aggregation of various data such as weather conditions, fuel prices, conditions and performance of machines and vehicles supports a targeted route and time planning as well as the determination of the most efficient routes. In the process, real-time data from sources such as GPS and other tracking systems, mobile apps or traffic cameras provide information about traffic jams, accidents and other traffic obstructions. Based on the information collected, users receive warnings and suggestions for alternative routes at an early stage, thus reducing the risk of delays.
AI also supports the optimization of loading capacities in transport vehicles. For this purpose, the size, weight and specific requirements of the goods are included in the calculations to determine the best possible use of the available space and avoid unnecessary empty runs. Companies can use the AI-supported transport management systems to better manage their vehicle fleet, keep an eye on maintenance requirements, minimize downtime risks and save costs in the long term.
2. Artificial intelligence supports purchasing and procurement
Another area where companies benefit from artificial intelligence is purchasing. AI puts companies’ procurement systems on a digital footing and enables accurate demand forecasting through streamlined, digitized and centralized processes: this allows companies to ensure that the required amount of products is available at the right time. Manual processes of demand forecasting and procurement are often prone to error and offer scope for bias or misinterpretation. Artificial intelligence, on the other hand, evaluates data from various sources and creates predictions and forecasts based on the conducted analysis. All steps of a procurement process can be coordinated and monitored centrally – from supplier selection and offer management to invoicing and payment processing.
3. Warehousing solutions – AI optimizes warehouse management
As a central location for the storage of raw materials, intermediate products and finished goods, the warehouse plays an important role in supply chain management and forms a hub for the smooth flow of goods between suppliers and customers. Artificial intelligence helps to stabilize and accelerate processes, reduce error rates and – especially in view of labor shortage – save resources in the form of personnel. AI-powered systems manage the flow of goods, update inventory, relay orders, and provide analytics for decision-making. This provides clear efficiency advantages: The more effective warehousing solutions are in terms of goods receipt and goods issue, picking, storage, packaging, shipping and inventory management, the more reliably delivery dates and quantities can be met.
4. How AI supports sustainability efforts
Scarcity of resources, expanded reporting measures, increased public sense of responsibility: Compliance with sustainability criteria is no longer just about the ecological footprint of the individual company; the focus now lies on the entire supply chain.This requires an increasing amount of data to be collected, analyzed and classified. Artificial intelligence supports the extension of social and legal requirements to the entire supply chain and contributes to making the supplier market transparent as well. Through the AI-supported evaluation of energy consumption data, transport optimization or monitoring of environmental impacts, companies can make data-driven decisions and better achieve their sustainability goals.
5. Resilient supply chains through AI – the benefits
The strategic integration of artificial intelligence into processes along the supply chain offers companies versatile opportunities to sustainably improve efficiency, competitiveness and customer satisfaction:
- Routes can be planned more efficiently by incorporating weather and traffic data – thus shortening transportation times, lowering costs, reducing congestion and cutting emissions.
- By collecting and providing real-time data, AI provides a new dimension of transparency – supply chain processes can be monitored in real time.
- AI facilitates and automates the search for suitable suppliers and evaluates to what extent the profiles fit the companies’ requirements.
- With the analysis of complex data and optimization measures derived from it, the efficiency of companies in procurement is sustainably increased.
- Artificial intelligence supports risk management and can identify potential disruptions or bottlenecks along the supply chain at an early stage and take appropriate action – hence minimizing the impact of disruptions and increasing supply chain resilience.
- Technology helps to improve customer satisfaction – by analyzing customer data, companies can provide personalized and tailored delivery experiences.
In addition to versatile opportunities, however, the use of artificial intelligence also comes with certain challenges: AI systems are based on high-quality and extensive data sets, which usually come from various sources and are available in different formats. For a sound analysis, all data must be cleaned and integrated so that predictions can be made as accurately as possible. This is done with the help of appropriate technologies, which companies must have at their disposal. Access to sensitive information also requires a careful handling of the issue of data security and data protection – In order to avoid violations of legal guidelines, appropriate security standards must therefore be implemented.
6. Conclusion: Intelligent supply chains through the use of AI
The increasing complexity of supply chains requires effective planning, organization and collaboration between companies, partners and suppliers. With the help of individually configured SCM software and through the use of artificial intelligence, all process information in the network is aggregated, synchronized and evaluated in real time. Raw data is transformed into information and usable knowledge within a very short time in order to make predictions and informed decisions. Companies are therefore well advised to take a close look at the subject area and investigate possible AI application areas. Agile and flexible strategies with digital solutions have now become essential to strengthen supply chain resilience and successfully master unforeseen challenges.