Today’s global supply chains move at digital speed, but too many shipping-related processes still rely on old-school technology. Emails. Faxes. Spreadsheets. The time-sucking “busy work” that frustrates us all. Enter artificial intelligence, or AI – a game-changing technology that is revolutionizing how companies manage their global shipping and logistics operations.
AI’s ability to analyze mountains of data in near real time, enable smarter decisions, and predict outcomes is formidable. But supply chain leaders must make a conscious choice to win with AI.
You must be willing to identify and eliminate inefficient processes in favor of more efficient, AI-enabled ways of working. If, instead, you take a “wait and see” approach to AI deployment, you’ll end up eating the dust of early adopters – and making your company less competitive in the process. Let’s take a look at AI in logistics and some of the ways it’s already helping global shippers work smarter, not harder.
AI in Logistics: Automate Repetitive Tasks
Walk through any shipping office, truck terminal or warehouse and you’ll probably see people doing work that could be done by machines – data entry, manual checking of shipments for accuracy, sending emails and faxes.
Now, check in with the people doing this work. Are they happy? Research on employee satisfaction suggests they’re not. Why? Because they are being asked to do the same repetitive task, over and over. The kind of task tailor-made for robots or an AI-enabled workflow.
Could clerical roles be replaced by AI? Maybe. But here’s the irony. AI’s biggest gift to the world may be the time it gives back to people to solve truly big problems.
When evaluating the ROI on AI investments, companies calculate the labor costs saved, but rarely consider what people do with that extra time. Therein lies the true power of AI in logistics – freeing up people from mundane tasks so they can innovate, bring initiatives to life, build stuff.
What kind of mundane tasks can they leave behind? Managing shipping exceptions is one example. AI can revolutionize this task by continuously analyzing shipment data and flagging exceptions automatically.
That’s what Dimerco’s Kuala Lumpur office in Malaysia does for a large, global semiconductor company. Dimerco proactively pre-plans routing and manages hundreds of delivery notes (DNs) for daily shipment arrangements. However, these plans are frequently adjusted, with updates communicated through an online spreadsheet that is revised multiple times throughout the day. Without AI, clerks would need to constantly monitor the spreadsheet for changes, download the commercial invoice and packing list to check for discrepancies, create the HAWB manually, and update the operating system. Instead, an AI-aided process monitors and analyzes multiple shipments in real-time, flagging only the exceptions. This reduces what would normally be 3-4 hours of manual work to just minutes, and with 100% accuracy.
AI in Logistics: Optimize Shipping
One of the primary applications of AI in logistics is analyzing vast amounts of data to optimize the flow of goods across global supply chains.
- Predictive Analytics: AI models can forecast demand for products, which helps companies better plan inventory to minimize overstocking or stockouts, reduce costs and improve customer satisfaction.
- Route Optimization: AI algorithms can process real-time data (traffic, weather, port congestion, etc.) to suggest the most efficient routes.
- Demand Forecasting: AI helps businesses predict future shipping volumes based on historical data, economic indicators, and trends. This ensures more efficient use of shipping resources (e.g., container capacity, truck fleets).
AI in Logistics: Optimize Warehouse Operations
Robotic Process Automation (RPA) in the warehouse, though it is not considered classic generative AI, is still transforming distribution operations, improving speed and accuracy while reducing labor costs. For instance, AI-driven robots are now commonly used for warehouse tasks like picking, sorting, and packing. These robots are equipped with sensors and cameras to identify and move items with high precision, reducing the need for manual labor.
RPA doesn’t always involve physical robots. For example, to enhance the speed and accuracy of receiving shipments at a trans-load site, Dimerco’s warehouse scanning app scans the DN# on hundreds of boxes that arrive daily and links the product to a specific PO for outbound shipping. A portable printer attached to the worker’s wrist then prints out the shipping label. This automated process ensures accuracy and reduces the process from 50 seconds per box to just several seconds.
AI in Logistics: Enhance Supply Chain Visibility
Visibility in the supply chain promotes effective communication and collaboration among stakeholders. Logistics operations are vulnerable to risks like natural disasters, labor shortages and disruptions related to geopolitical issues. AI’s predictive capabilities empower companies to anticipate potential risks and devise contingency plans.
The enormous volume of data collected as part of global shipping programs makes this industry a prime candidate to use AI. By implementing real-time visibility, companies can share information and forecasts with suppliers, customers and partners. This transparent communication helps build trust, enhance collaboration, and enable timely decision-making. Such collaborative efforts enhance supply chain resilience and agility.
Let’s look at one example of how Dimerco uses AI-aided tracking of ocean shipments that subsequently move to rail.
- Using generative AI, we provided Google Gemini with many examples of arrival notice formats for different carriers, enabling the tool to automatically ID the carrier. Dimerco’s “Dimbot” (our agent for robotic process automation) connects to carrier systems via API, verifies milestone accuracy, and updates our own system with the new tracking information. If there is an irregularity, our system will send an email alert to key parties.
- For onward rail shipments, Dimbot extracts the carrier’s arrival notice and, from that, can determine the rail operator. Dimbot then goes into the rail operator’s website or portal to get milestone updates and bring them back into our operating system.
- All shipment status details from Dimerco’s cloud-based global operating system are immediately available to customers via their own MyDimerco portal.
“Many of our automation solutions are not based solely on AI,” according to Dimerco’s Senior Director of Business Intelligence Technology, Steven Chen. “We often synergize AI’s capabilities by calling APIs that allow the AI to work within our systems. So even though we’re not typing in AI prompts search engine style, we’re integrating AI as part of the operational workflow.”
AI in Logistics: Streamline Customs and Compliance
Customs documentation and trade compliance are critical components of global shipping operations. Ensuring that all paperwork is accurate and compliant with international regulations can be a time-consuming task. AI can automate these processes, drastically reducing the time and effort required to manage documentation.
For example, AI can be used to automatically generate and verify commercial invoices, packing lists, and other necessary documents. It can also ensure that these documents comply with the regulatory requirements of different countries, thereby minimizing the risk of delays due to non-compliance.
Want to know more about customs and compliance? Read our article: Global Trade Compliance: Understanding the Basics.
AI in Logistics: Optimize Customer Service
AI-powered chatbots and virtual assistants are increasingly being used by shipping companies to improve customer service, like responding to requests for shipment status updates. These systems provide updates and handle simple requests autonomously, reducing the need for human intervention.
For common customer service issues like delayed shipments, missing items, or delivery changes, AI chatbots can resolve these issues through automated systems or route the more complex queries to human agents.
Dimerco has created an intra-company application of this capability. We trained an AI model on all Dimerco’s employee manuals so staff can now go on the company’s intranet and ask questions, such as vacation policies and which brands of laptops can be used. This gives people the immediate answers they want and frees up HR, IT and other staff from unneeded phone calls and emails.
Needed: A New Way of Thinking and Working
There’s no denying the numerous benefits of supply chain digitalization and the use of AI in logistics. But according to Dimerco’s Steven Chen, realizing them requires a new way of thinking and a willingness to change.
“In an industry often stuck in old ways, it’s important to think digital first,” he says. “We must release people from the shackles of data entry, proofreading of documents and other mundane, repetitive tasks during the global shipping process. Doing so enhances company profits and, most importantly, frees up people to support bold, difference-making initiatives that help companies gain a competitive advantage.”
Dimerco is a tech-forward international freight forwarder that helps companies compete and win through superior logistics to, from and within Asia-Pac. To discuss how we can increase the speed and efficiency of your global shipping operations, let’s start a discussion.