In a 2018 documentary, the troubled Tesla and SpaceX CEO Elon Musk warned the world about the unprecedented growth of AI (artificial intelligence). Musk, who has always been a stern critic of AI, said that if not regulated artificial intelligence could stimulate the creation of an evil robot director that would rule over mankind forever. While his views may be widespread, come to think of it, the advancements made in the field of AI, automation, IoT and cloud computing have brought nothing but convenience to our lives. AI and machine learning, without a doubt, have caused major disruptions across all industries. From manufacturing to logistics, the impact has been colossal, to say the least. And, these transformations are happening as we speak. Take, for example, the express logistics industry, wherein implementation of AI-based applications have already started transforming the entire operational framework, productivity and efficiency, substantially reducing the costs involved and time consumed.
AI and its predictive features
In express logistic industry, there are two interconnecting factors – cost and time. This means, trying to improve one aspect will hurt the other. With the arrival of AI and related technologies, however, the equation is changing. Leading players in this sector have already begun harnessing the power of AI and machine learning to strengthen their operational strategies and real-time decision making on issues pertaining to availability, the location of inventories, transport and even the workforce. And, these technologies are bringing about volumes of data that can be leveraged to optimize the costs, delivery schedules, transit time and few other important areas. Furthermore, AI-based predictive analysis enables businesses to know the estimated number of orders on a particular day or the demand of certain products in a region, therefore decreasing the risk of failing to cater to customer demands. When it comes to the transport part, predictive analysis can also warn the operators if there are any chances of a vehicle breaking down and other unforeseen circumstances.
Real-time decision making supported by AI
Personnel working in the express logistic industry are often required to deal with a series of important but repetitive tasks, which consumes a lot of time. Up until now, these tasks were handled manually. Luckily, modern businesses are committed to bringing a change to this scenario through the deployment of AI and machine learning. For instance, the delivery of a product involves multiple steps like scheduling the delivery date, confirming the delivery route and also assigning the task to a candidate. Without AI, the data gathering itself can take up days, if not more. However, AI and related technologies have made it possible to automate the process to a substantial extent, much to the delight of supply chain professionals.
Improving last-mile delivery
Last-mile delivery costs, on an average, comprise around 53% of the total cost of shipping a package. In fact, Amazon, the biggest e-commerce player in the world, experienced a USD 21.7 billion jump in its logistics costs from 2015-2017, a nearly 2X jump! This is the reason why Amazon has started to invest majorly in start-ups that are introducing technology to neutralize the last-mile hiccup, investing more than half a billion in new technologies that will help it to cut costs by at least 40%.
Data-driven AI to remain the king
In today’s fast-tracked world, where change is the only constant, the value of data is greater than any currency. Hence, it’s no secret that data-driven AI will continue to make impacts in the express logistics industry. While there are concerns such as deployment cost, data privacy and loss of jobs, industry observers believe the rapid progress of technology will overcome all these barriers. And, with the 4th Industrial Revolution looming over us, it’s only a matter of time before artificial intelligence expands its presence across other related industries too.
[This is an authored article by Chander Agarwal, Managing Director of TCIEXPRESS. All views, opinions and expressions are personal and limited to the author.]