How AI Is Transforming Global Supply Chains


By now, it is old news to say that AI (Artificial intelligence) is an ever-present component of our lives.

Smart home assistants, movie and music recommendations, the ads we see on social media – all of it based on AI and its ability to think and predict as humans do, or even exceed our abilities.

It is no surprise, then, to learn that AI is already transforming global supply chains in significant ways. Here is what AI is doing for the industry at the moment.


Predicting demands

One area of expertise that we already know AI is excellent at is handling vast amounts of data and noticing patterns and trends that might be impossible for a mere human to see.

Merge this with logistics, and you’ve got yourself a perfect match.

Companies have realized that AI has a great potential to help them make more agile and timely decisions by anticipating potential bottlenecks and shortcomings in the supply chain.

The predictive abilities of AI can help businesses forecast demand for their products. With its help, companies can be more proactive and, for example, dispatch more vehicles to the area where they expect higher demand.

Thus, increased demand will not break the logistic chain, and businesses will save a great deal of money while the customers will be satisfied.


Better customer satisfaction

The same ability that AI has – the capability to anticipate and predict issues – can also improve customer service and increase customer satisfaction.

Intelligent AI bots can respond to the customer’s queries and learn from past experiences, constantly improving themselves in the process.

Not only that but unlike humans, bots do not get sick or tired and do not have limited working hours. With bots, your company can provide customer service around the clock, thus improving customer satisfaction and retention.



It should come as no surprise that AI and robotics go hand in hand.

In logistics, robots are in charge of tracking, locating, and moving inventory within the warehouses.

These robots come with deep learning algorithms that help them make autonomous decisions about the different processes performed in the warehouse. They can handle the items more quickly than their human colleagues and stack and pack them more efficiently, too.


Better warehouse management

AI is not merely some passive thing that simply handles enormous data quantities and presents us with the final results.

When equipped with specialized cameras, AI can also “see.” Once again, AI does this better than we humans can.

For instance, DHL is using one form of AI to do intelligent robotic sorting. The ability to see parcels makes it possible for AI to deal with letters, packages, and palletized shipments and sort and handle them quickly and effectively.

Simultaneously, those same unique cameras make it so that AI can notice defective or damaged packaging and deal with it appropriately.

Since DHL uses 58 different parameters to utilize AI in their everyday activities, there is even more to this.


Enhanced safety

AI-based automated tools can provide more innovative planning and efficient warehouse management. This improves worker and material safety.

AI can also analyze workplace safety data and inform manufacturers about any possible risks. It can record stocking parameters and update operations along with necessary feedback loops and proactive maintenance.

All of this helps manufacturers react swiftly and promptly to keep warehouses secure and compliant with safety standards.

Let us not forget that the future will most likely bring more and more autonomous vehicles.

These will be intelligent and driverless freight transportation methods capable of reacting with speed and awareness that no human could match.

Innovative vehicles on the road will likely mean fewer accidents and reduced costs through liability and damages, leading to more safety for anyone on the road.


Energy efficiency

As stated in the intro, almost every device we have these days – from refrigerators to watches – is in some way “smart” – that is, it is AI-powered and capable of accessing the Internet.

When you connect all these smart devices, you get what is popularly known as the Internet of Things (IoT).

With IoT insights and data analytics, energy efficiency is easy to achieve. AI can pull data from the roads, consider weather conditions, traffic jams, and the state of the very vehicle it is tracking to make intelligent and cost-effective decisions.

Via more efficient routing processes, AI can reduce fleet idle time and miles driven. Meanwhile, it can optimize insights into different equipment and labor processes to keep energy expenditures at a minimum.


Risk management

Logistics often lack the tools needed to accurately and rapidly identify, assess, and mitigate risks. This is mainly because they do not have access to all of the data they need.

The tools at their disposal are not connected. They can’t give a comprehensive view of the potential risks, the probability and severity of those risks, and exactly where, when, and how those risks could impact individual shipments.

With AI, companies have real-time data to anticipate risks and take action before they turn into issues.



AI and supply chain and logistics simply go together.

From better customer support to the improved predictive abilities of AI that can help predict potential problems and shortcomings in the supply chain, there are many aspects of the industry where AI can improve the process.

Besides, AI is also capable of dealing with big data, crunching numbers, and noticing trends. It can help guide robots dealing with the warehouse inventory to pack items more effectively and catch damaged or faulty parcels.

With its contextual intelligence, AI can provide companies with insight that makes it easier to reduce operating costs, quickly reach back to the customers, and effectively manage the inventory.

In the not-so-distant future, AI will most likely be in charge of operating smart cars and vehicles, thus adding another layer of speed to the supply chain. Also, AI-powered vehicles mean higher safety levels for the people working in the warehouse and dealing with the inventory.



Jennifer Wilson is a marketing specialist and writer at She knows business processes and operations management inside out. As she understands all the challenges of running a small business firsthand, it’s her mission to tackle the topics that are most relevant to entrepreneurs and offer viable solutions.