How AI will be a gamechanger in transforming global supply chain

In the last couple of years, the rules of the game within logistics and global supply chains have endured the biggest disruption since the containerisation of global trade in the 1960’s and 1970’s.

While the trade war between The US and China, Covid-19, and Russia’s invasion of Ukraine changed the way we think of redundancy, flexibility, and security of supply, we are now staring into what could possibly be the biggest game-changer yet: The rapid evolution of Artificial Intelligence which has most recently accelerated investments from companies all over the world and spun a global discussion about how the technology will change our society – for better or worse.

The hype was triggered when Open AI’s Generative AI, ChatGPT, attracted 1 million users in just 5 days and 100 million users after two months. In comparison, it took TikTok nine months to hit the 100 million mark.

Generative AI is pushing the frontier and is spawning new startups and use cases like never before, and the race to leverage this new technology at scale is picking up pace. To understand what is at stake, firstly, let us have a look at what this technology offers: Generative AI leverages Large Language Models that can synthesise extremely large amounts of information and generate new information, i.e. ChatGPT not only provides you with existing information, but also with a new version of the thing you need an answer for which is based on what the model is learning. This has the potential to revolutionise information in global supply chains by optimising and automating processes that are either manual or spread across different platforms.

Let me give you an example: Today, around 100 people are directly involved in moving a pair of sneakers from its origin to the end destination – that being salespeople, warehousing staff, customs officers, seafarers, and truckers. In the coming years, we will see a movement towards AI enabled systems that can speed up cumbersome customs procedures, remove roadblocks, and make it easier for goods to cross borders. Moreover, demand forecasting and visibility platforms powered by AI will be developed to help companies optimise inventory levels and provide real-time visibility in the supply chain.

We are staring into a future where rapid technological development will remove roadblocks and intermediaries. Within the next decade, zero touch logistics will overtake manual and cost-heavy processes like analogue bookings and customer service whilst enhancing predictability through online recommendations based on crunching of data, hence making transportation of goods more seamless, efficient, sustainable businesses everywhere.

Accelerating competences
Today, AI-enhanced tools are beginning to get used to increase efficiency and productivity, reduce the impact of a global worker shortage, and discover better and safer ways to move goods from one point to another. But we are only just getting started and in the very near future it will be possible to leverage generative AI to help improve key areas such as sales operations and workflow at the front line through automation.

Going forward, AI development will allow logistics professionals across the industry to greatly expand on ways we can deliver better and more sustainable products and services. We see a coherence between an enhanced use of data science, machine learning and Generative AI, and an increased value in helping our employees make more informed decision; whether they are sea captains using route recommendations to navigate unpredictable weather or sales teams supporting modularised product and price offerings for our customers.

Generative AI will be leveraged to provide personalised, efficient, and impactful support for customers with minimal human intervention. It will also help identify patterns and make recommendations that are tailored to each client’s specific need. This will both improve the customer experience by providing immediate assistance and establishing greater visibility, and free up human capacity to focus on deeper strategic and operational issues.

Regulations are needed
It is also important to approach it with care to mitigate concerns about data security and data protection. Today, most companies are driven by purpose and values, and customers, suppliers and employees must be able to maintain trust in this technology being used in an ethical manner. Awareness and education are the best ways to empower people in times of rapid technological change, and the fast development of AI has further strengthened our focus in this area. Today, the majority of our Maersk colleagues are training in AI and Data Ethics and the number will only grow bigger.

But no company can do this alone. AI is sweeping across industries and changing the way we incorporate technology in our everyday lives, and we have only seen the tip of the iceberg. While people are already benefiting from AI supported functions, we are also seeing examples of alarming pitfalls and misuse such as Large Language Models and deepfakes exhibiting hallucinations or providing fake news. There is also potential for pitfalls if people with malicious intent manage to hack or manipulate an AI system by feeding it false data.

We have embarked on a new and exciting technological chapter which will profoundly transform global supply chains. This is why we call upon businesses, policy makers across the world, and organisations like the EU and World Trade Organisation, to come together and develop a global framework and set of regulations to leverage the best of AI for the benefit of all.

The writer is Chief Technology and Information Officer (CTIO), A.P. Moller - Maersk