Artificial intelligence (AI) has come a long way since its inception in the 1950s. In the past decades, AI has rapidly evolved and transformed various industries, including Supply Chain Management (SCM). In this piece, we will explore the evolution of AI and its impact on modern supply chains and global shipping.
The concept of AI was first introduced in the 1950s, but it wasn’t until the 1980s that AI had begun to take shape (and terrify moviegoers with the prospect of sentient killing machines from the future).
Expert systems and rule-based systems were developed during this time, which enabled computers to perform tasks that would require human intelligence. However, these systems were limited, with a much narrower scope than modern AI.
In the 1990s, machine learning emerged, which allowed computers to learn from data without being explicitly programmed. This breakthrough led to the development of neural networks and deep learning, which are the foundations of modern AI.
The impact of AI on global supply chains has been tremendous! AI has enabled supply chain managers to make better decisions by providing them with insights and predictions based on large amounts of data. Here are a few examples of how AI has impacted SCM:
AI algorithms can analyze historical data to predict demand, inventory levels, and lead times. This enables supply chain managers to optimize inventory levels and avoid stockouts.
AI-powered autonomous vehicles can transport goods without the need for human drivers. This has the potential to reduce transportation costs and increase efficiency.
AI-powered robotics can perform repetitive and labor-intensive tasks in warehouses and facilities. This reduces the need for human labor and increases productivity.
AI-powered natural language processing can be used to monitor customer feedback and social media posts to identify potential supply chain issues before they become major problems.
Despite limitations of early programs like the “Logic Theorist” and “General Problem Solver” programs (designed to prove mathematical theorems and solve problems, respectively), the development of AI in the 1950s paved the way for future breakthroughs in the field. Over the next several decades, advances in computer hardware and software would lead to the development of more sophisticated algorithms and systems that could perform increasingly complex tasks.
Here are some of the ways AI has impacted the shipping industry specifically:
AI-powered algorithms have helped shipping companies and enterprises alike reduce their environmental impact by optimizing shipping routes to reduce fuel consumption and emissions. Similar technologies like AI-powered vessels can operate more efficiently than traditional crafts and also reduce fuel consumption.
AI-powered solutions have helped shipping companies optimize their operations and reduce costs. For example, AI algorithms can analyze historical data to predict demand, optimize shipping routes, and manage cargo loading and unloading.
AI-powered technologies such as autonomous vessels, drones, and robots have helped improve safety in the shipping industry. These machines can perform tasks that are too dangerous or difficult for humans to do, such as inspecting hulls and cargo holds.
AI-powered solutions have enabled shipping companies to provide better customer service by providing real-time shipment tracking, automated customer support, and personalized recommendations.
Lastly, AI-powered solutions have helped shipping companies improve security by detecting and preventing cargo theft, piracy, and other security issues.
This million-dollar question has no easy answer. The future of AI in the shipping industry is likely to be transformative, with the potential to bring significant efficiency gains and cost savings, as well as improved safety and environmental performance. While it’s nearly impossible to say for certain if future automation will render SCM obsolete, below are the most likely scenarios given the current landscape:
AI can be used to predict when repairs are needed for ships and their components, allowing for proactive maintenance and reduced downtime.
While autonomous vehicles certainly aren’t something new, AI may soon be leveraged to develop fully autonomous ships, which would reduce the need for crew members on board and increasing cost savings.
AI can be used to monitor and analyze environmental data, such as sea temperature, pollution levels, and weather patterns, which can help shipping companies make more informed decisions about route planning and fuel consumption.
AI can be used to optimize supply chains by predicting demand and adjusting shipping schedules, routes, and even inventory accordingly (thereby reducing waste and increasing efficiency).
Overall, AI has the potential to bring significant benefits to the shipping industry, but it requires a willingness to invest in- and adopt new- technologies and business models. Depending on the technology, the benefits of increased efficiency, safety, and sustainability can yield enormous returns for businesses of any size.
To those worried about AI taking their jobs or taking over civilization, we offer this quote from fictional news anchor, Kent Brockman: "I, for one, welcome our [robot] overlords!"
Joking (kind of)!
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