AI in Supply Chain: Top Use Cases of AI in Supply Chain Management

AI in Supply Chain

AI in Supply Chain: Top Use Cases of AI in Supply Chain Management

Supply chain management plays an important role in the current era of high demand for supply, which stimulates competition and demands uncertainty.

Supply chain management refers to a company’s ability to coordinate and manage equipment procurement processes, improve customer experiences, and well organize sales and distribution functions.

Recognizing the growing importance of success and information of the supply chain, professionals in supply chain management are investing in better business decisions and better control of information. Solution providers are adopting AI technology to improve the workflow and productivity of the supply chain.

In this article we have discussed:

  • Top use cases of AI in supply chain management
  • Benefits of AI in supply chain
  • Things to know about artificial intelligence for supply chain management

Let’s get started!

AI in Supply Chain

The growing deployment of Artificial Intelligence in supply chain management is also owing to several fantastic factors such as visibility in supply chain procedures and data, and demand for better transparency.

Increasing adoption of Big Data technology is another driving factor driving artificial intelligence in logistics and supply chain management-related markets for better customer satisfaction and service.

Furthermore, expanding interest in precision and well-being in distribution centers would drive the development of AI in the supply chain industry soon.

Many organizations are getting benefited by investing in Artificial Intelligence technology. Recent research by McKinsey found that 53% of executives reported increased revenue and 61% reduced costs by introducing AI into their supply chains.

McKinsey also predicts a company to pick up between $1.3tr and $2tr a year in economic value by embracing AI in their global logistics and supply chains.

ai in logistics and supplychain

Recommended To Read: Top 5 Examples Where AI Is Used


supply chain analytics market size 2014-2025
Here, we are going to cover the topics that describe the best use cases of AI in supply chain management.

Things To Know About Artificial Intelligence For Supply Chain Management

This session provides information on a few essential things to know about artificial intelligence for the supply chain management.

  • AI-based supply chain software applications need minimal support from the human workforce.
  • AI-powered supply chain predictive analytics solutions need to be integrated with ML and deep learning capabilities for delivering accurate results.
  • AI supply chain apps development with advanced sensor and facial recognition capabilities will help companies improve supply chain visibility and security.
  • AI applications for supply chain management need vast amounts of data to feed systems and meet the desired needs of supply chain operations.
  • Artificial intelligence for e-commerce is being used in supply chain software solutions for segregating goods categories, monitoring orders, and managing inventories. Make sure of building a multi-purpose supply chain software for reducing cost overheads.

If you plan to develop AI development, you must remember these things to save your budget, build best-in-class solutions, and achieve good results and RoI.

Top Use Cases of AI in Supply Chain Management

Here are the best answers for how artificial intelligence improves the supply chain process.

Predicting Customer’s Behavior

Consumers are sometimes whimsical; they will change their minds suddenly. They may cancel their placed order even if the order is about to deliver and this just leads to a waste of time and effort on your logistics.

This kind of order process can lead to abuse and productivity loss among your logistics team. Therefore, it is difficult to pinpoint volatile customer behavior due to a surplus of orders from online retailers.

This unpredictable order pattern can lead to abuse and unnecessary productivity loss among your team. It is very tough to pinpoint volatile consumer behavior due to the order delay from the e-commerce retailer network. Therefore, the ability to attend to volatile order volumes is a challenge for many companies.

But, Machine Learning and Artificial Intelligence will provide you with the freedom to assess the volatile nature of consumer behavior at the right level in such situations. Artificial Intelligence in supply chain management will predict the volatile nature of buyers and contribute to business development. Supply chain predictive analytics solutions would help companies generate more profits by predicting product demand.

This application is gaining popularity in the retail industry. The use of AI in retail supply chain makes retailers monitor customers’ behaviors and purchasing patterns and help them to optimize sales levels.

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    Mitigating the charge-back risks

    Customers can demand chargeback/ penalties from brand proprietors when products delivery got delayed. Subsequently, brand proprietors or business partners need to pay penalties for late deliveries.

    Using AI technology integrated with deep learning, it’s very simple to shuffle through the required data including the order types, placement, type of shipment, and location. It helps to find the main reasons for a chargeback. On the other hand, it supports analyzing the reason for failure.

    Sensing Market Situations

    The use of Artificial intelligence in supply chain management for analyzing market trends is a hot topic in the industry. Noticing market patterns and marketing behavior is the most important aspect of staying updated in business and providing better assistance to consumers. AI will utilize real data from several external sources that include employment history, industrial production, and weather.

    When it comes to processing data from this sourcing, the app better assesses the growth drivers and market analytics. Artificial intelligence can reshape the abilities of the supply chain by expanding capital use, sensory skills and a portfolio of products.

    Improving accuracy in the tracking of departing and arriving orders

    Tracking the navigation route of online orders to load the warehouse with the advanced product line is crucial in the supply chain. Since there are manual errors in the path of order alignment, it is not possible to place the resources correctly.

    The items that could not move for a long time in the warehouse are pushed backwards and then replaced with fast-moving materials. It will be really a big task for retailers to move old items out of the warehouse if there is no proper planning and implementation.

    Hence, AI algorithms will inflate the departure and arrival of the goods in and out of the warehouse, which aims employees to keep the pallet in the proper position and release the goods as per their shelf life.

    Online businesses will become smarter, utilizing AI-based software in their logistics and supply chain.

    AI in Supply Chain

    Also Recommended To Read: AI in the Transportation Industry

    Increasing Fleet efficiency

    The most important thing in the supply chain is delivering products to the destination on a given timeline. It just takes a minute to break or make the brand value. It is a known fact that it is impossible to predict what will happen while the vehicle is on the way to deliver products.

    In such a situation, the AI-controlled GPS permits a better route for your vehicle. This AI software will help you find the most feasible path for delivering products by processing driver, consumer, and vehicle information.

    At the same time, it will help you reduce cost, tear, and wear of truck tires. According to research reports, it is believed to use the latest AI-integrated GPS for logistics and supply chain delivery; users will save $ 50 million (Approx.) per year.

    AI improves customer experience.

    It is one of the significant benefits of AI in supply chain management. According to the report from Pega, 38% of customers believe that Artificial Intelligence will improve customer satisfaction.

    AI software personalizes customer relationships with global logistics suppliers. Using AI inventory, consumers can utilize the voice-based service to track the placed orders.

    If any issues arise, the customer can directly speak with the customer service team, which is very beneficial to resolving the issue in less span.

    AI enhances Customer experience

    Also Recommended To Read: The Revolution of Artificial Intelligence Technology

    These are a few top benefits of AI in supply chain management and these applications are reshaping supply chain functionalities. Implementing advanced analytics in supply chain procedures, AI apps are digitizing supply chain operations and ensuring transparency across the processes.

    Wrapping Up

    AI technology has made the whole supply chain process simpler and more precise. AI in retail supply chain avoids human work, which is essential for organizations that need to minimize errors and costs as well.

    On the other hand, with the rise of AI at breakneck speed, many businesses are already invested in this amazing technology to manage their supply chain. The output is whole automation from production to product delivery with an overall development in speed and efficiency.

    If you would like to adopt Artificial Intelligence in your business, please contact us.
    USM Business Systems is a pioneering technology partner serving a wide range of industries with AI solutions.

    With its array of digital technology solutions, USM helps supply chain companies to improve operational performance and change the way logistics and supply chain work.

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