Advancing AI Smarter Intelligence Everything In The Transportation And Logistics Industry – Industry Series: Blog #5 – Forbes

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In the first blog in the AI transportation and logistics series, I featured AI transformation innovations at Purolator; the second blog focused on the acceleration of smarter AI telematics in fleet management. The third blog explored AI emotion sensors and the impact that the affective computing market is having on the transportation and logistics industry. The fourth blog discussed AI revenue growth and operational optimization use cases relevant to the T&L industry and touched on drones and their economic impact.

This fifth blog discusses the impact of smarter intelligence integrated into the supply chain management (SCM) value chains, from picking, sorting, delivering, and all sales and customer service operations. A complete technology end-to-end connected - IoT a smarter AI sensor value chain, where humans are the strategic architects, controlling the dynamics of their SCM ecosystems, determining and adjusting in real-time operational requirements.

We will see in our life time, more robots, cobots, driverless vehicles and smarter IoT sensor highways integrated creating this realtime pulse that will reshape millions of jobs around the world.

Sound far-fetched. Likely in my life time, I wont see all of this come together. However, my children likely will.

Just look how at some history of the origin of the aerospace industry which dates to1903when the Wright brothers demonstrated an airplane capable of powered, sustained flight. The worlds first scheduled passenger airline service took off in 1914, operating between St. Petersburg and Tampa, Florida. This historical event helped advance daily transcontinental flights.

In just 100 years, we went from literally no airplanes in the sky, to having over 250 international airlines, and over 5,000 airlines having official ICAO codes.

Lets compare this speed to the speed of the drone and IoT smart logistics industry transformation. What are the drivers of the change. Perhaps four key drivers are noteworthy 1) the disappearance of space and time barriers 2.) the ability to stay connected while on the move 3.) The Internet of Things and 4.) The universality of the internet and rise of cloud computing enablements. The outcome - smarter connections in everything.

We are underway with a transformation where our customers expect faster deliveries, real-time information available on any of their devices, smartphones, tablets or elsewhere and ability to alter suppliers on any whim they so choose. The power has shifted to the customer driving the logistics industry to rethink almost everything.

The digitalization of the transport and logistics industry enables supply chain companies to have not just better supply chain visibility, real-time management of traffic and cargo flows, simplification and the reduction of administrative burden, better efficiencies of costly infrastructures and resources, but more importantly this full scale digital transformation will open up new value growth opportunities and reduce the overall carbon footprint of transport end to end.

Pioneers like former Uber employees tackled the freight forwarder sectorby founding the company Beacon, affirming its claim to a place in the logistics organization but also in retail financing. Beacon has recognized that shippers are seeking technology-led products and services that will meet their needs more effectively, enhance their experience and cut their costs. Ovrsea, a digital air and maritime freight in France, is innovating bringing rich analytic insights across ocean freight, air freight, rail freight - across complex logistics and transportation networks enabling unprecedented visibility.

Frost & Sullivanestimates that the market that they define as Truck-as-a-service (TaaS) is expected to reach $79.4 billion in 2025 in the United States, against $11.2 billion currently.

In a white paper titledFuture of the Tech Economy, UBS estimated that warehouse rent is no longer the main driving force behind decision-making. Prologis, one of the largest owner of logistical warehouses in the world (1.7% of the world's GDP passes through Prologis warehouses each year), indicates online sales will require three times more warehouse space than the traditional economy.

Just look what has happened in the changing shift from B2B deliveries to B2C mix during Covid-19, disrupting supply chains around the world, creating unprecedented shipping backlogs, accelerating costs, and consumer disappointments.

With this type of change, the affordability economics in warehouses controlled by people no longer will be feasible. Hence the rise of drones and accelerated usage of alternative approaches to servicing transportation and logistical needs.

McKinsey indicates that 80% of all commercial vehicles will be networked by 2030, providing great potential for the emergence of additional digital services. Boston Consulting Group suggests that the provision of networked digital services will increase tenfold. You cannot pick up one of the major SCM publishing sources without some mention of AI, drones, robots or rise even of sentient beings.

The digitalization of the management of transport and logistic companies like: giants - FedEx, UPS, etc. - are having to respond to improving the productivity, safety, and profitability of their operations. Being able to harness datawith advanced analytical and connected tools can track all the activities of the carrier: from the management of driving and stopping times, to the braking and safety driving risks to the forecasting of the maintenance of trucks and their tires, and even through to the administrative management, the organization of rounds, the geo-location of trucks, the real-time tracking of packaging the real-time tracking insights are endless.

The biggest challenge is assembling all the disparate data sources into a universal data or information knowledge hub. Without integration into all the digital and data rich ecosystems, mastering the sharing of data is a daunting task for this industry. Hence why data lineage and data labelling services are also in high demand.

Taking control of the data means capturing, recording, and organizing data provided by customers, or from systems, customers, drivers, trucks, etc. and knowing how to share the data insights to provide better service is a key to unlocking the change journey roadmap.

Based on my experiences to date, complex digital transformation in the T&L industry is all about vision, strategy and architecture and applying new technologies and imagining new optimizations and new services. Its easy to stay locked into the past without appreciating how fast the T&L industry is transforming. Its a very exciting team to get moving, pardon the pun - its Halloween night.

XPO Logistics, for example, has set up a collaborative cloud portal to exchange information between its shipper customers and transport providers. This portal makes it possible to optimize the flow and cost of freight transport and to forecast future transport needs by combining machine learning and predictive analytic tools.

In the United States, JB Hunt has unveiled a Shipper 360 portal that gives shippers access to multiple modes of ground transportation, as well as information on carrier performance.

We are also seeing the acceleration of dark warehouses since Covid-19; a dark warehouse is a fully automated warehouse that is equipped to handle inventory by following systems commands. Goods can be moved, sorted, or even packed by robots or other automated machines doing away with the need for intensive physical labour. Goods can be moved to almost any location within the warehouse using automated machines and robots.

Nowhere is there more digital innovation change using AI in the transportation and logistics industry than in China. Just look at JD-X, the logistics lab of Alibabas e-Commerce archival. JD has been developing diverse smarter applications related to the movement and processing of packages from autonomous drones, delivery robots, and unmanned or dark warehouses, which are facilities where robots work alone in the dark, completing tasks formerly done by humans.

Automating the logistics sector is a major global trend, but in China, the stakes are even higher as the countrys population rapidly ages and labor costs rise. According to Chinas National Bureau of Statistics, the number of workers between 16 and 59 years old plunged by over 5 million in 2015. As the labor pool shrinks, demands for better benefits and higher wages have alsorisen. China has recently increased its policy of one child to two children to start accelerating labour needs to fuel their economy.

Conclusion

If you are a CEO or a Board Director of a transportation and logistics company, where do you stand in thinking about completed intelligent supply chains, using AI, drones, driverless enablements and dark warehouses.

Is your company ready for a fully digital end-to-end connected smarter reality facing the transportation and logistics industry?

There is no better way to start, than to start.

Tracking your competitors is one powerful way to stay ahead of the game -but dont wait, perhaps a visit to China, or visit an Amazon turbo charged robot warehouse, or bring a number of freshly minted engineering students to your company operations and ask them what would they focus on to drive a breakthrough experience even better take out ten of your smartest high potentials and pull them out of their demanding full-time jobs to think hard about imagineering your future business model. Give them just 30 days to rethink what others simply have not had the courage to say.

You will learn and grow and more importantly these high potential employees will feel an abundance of new energy to advance your company forward. The race to modernize is on and its moving forward with you or without you.

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Advancing AI Smarter Intelligence Everything In The Transportation And Logistics Industry - Industry Series: Blog #5 - Forbes