AIMultiple ResearchAIMultiple Research

3 Ways to Improve Supply Chain with Automation in 2024

Written by
Cem Dilmegani
Cem Dilmegani
Cem Dilmegani

Cem is the principal analyst at AIMultiple since 2017. AIMultiple informs hundreds of thousands of businesses (as per Similarweb) including 60% of Fortune 500 every month.

Cem's work focuses on how enterprises can leverage new technologies in AI, automation, cybersecurity(including network security, application security), data collection including web data collection and process intelligence.

View Full Profile
3 Ways to Improve Supply Chain with Automation in 20243 Ways to Improve Supply Chain with Automation in 2024

AIMultiple team adheres to the ethical standards summarized in our research commitments.

The Covid-19 pandemic helped organizations to identify various weaknesses in their supply chains. Supply chain networks are rife with repeatable, process-oriented, and error-prone tasks, ranging from manual documentation errors to picking and stocking errors, shipping and receiving errors, and much more. In the post-pandemic world, supply chain leaders are making more efforts toward eliminating these weaknesses and improving their supply chain operations. 

Automation is an effective way of enhancing existing supply chain processes and introducing new ones. AI and other automation technologies are on the list of the top disruptive technologies that will impact supply chains by 2025 (Figure 1). that Gartner expects supply chain autonomy in 10+ years with hyperautomation initiatives in the supply chain. As a result, organizations need to focus more on automating their operations to overcome the weaknesses in their supply chains and remain competitive.

This article explains 3 areas of supply chain automation to guide organizations toward supply chain resilience and autonomy.

Figure 1. Top disruptive technologies impacting supply chains of the future

A graph showing that supply chain automtion is one of the most disruptive technologies for supply chain.
Source: Statista

1. Warehouse automation 

McKinsey states that even though distribution centers are improving warehouse job attractiveness, employing and retaining warehouse workers is still difficult. Reports also suggest that pandemic significantly impacted the labor supply in the warehousing industry and suggest that this shortage will continue during 2022.

Warehouse automation can help supply chain leaders overcome the shortage issue. Furthermore, warehouse operations include repetitive tasks such as inventory management, supply chain tracking, and doing high-risk tasks, such as operating heavy equipment. Automating such tasks can enable companies to achieve more productivity, worker safety, sustainability, and lower costs.

Even though many businesses (80%) have still not implemented warehouse automation in any way, studies suggest that the warehouse automation market size will double to $30 billion by 2026 (Figure 2).

Figure 2. Global warehouse automation market size from 2012 to 2026

Source: Statista

In 2022, warehouse automation will be a prominent trend in the supply chain and logistics industry; therefore, leaders need to consider it an essential element for a sustainable warehousing future.

Warehouse Automation Examples

1. Supply chain tracking

Supply chain tracking refers to ensuring that your shipments are both sent and received on-time. On the supply side of the equation, shipping your customers’ orders out as soon as possible increases their loyalty and satisfaction. And on the production side of the equation, the timely receiving of intermediary goods will ensure an uninterrupted and on-schedule manufacturing process.

2. Demand/Supply planning & Inventory automation

New sophisticated technologies like Woodman’s badger robots and AI-powered demand forecasting solutions help supply chain leaders automate their inventory operations to minimize the occurrence of out-of-stock or overstock situations.

3. Automated guided vehicles (AGVs) / Autonomous mobile robots (AMR)

AMRs add intelligence, guidance, and sensory awareness to conventional AGVs. This allows them to operate autonomously and collaboratively around humans. AMRs address the limitations of traditional AGVs and make them better suited to complex warehouses and collaborative activities. 

Watch how Ocado, a UK-based technology company, revolutionizes the grocery sector through its warehousing automation systems.

Sponsored

UCBOS can help you incorporate customized automation solutions in warehouse management and other supply chain areas with its no-code supply chain platforms.

Read how UCBOS helped a company from the hospitality sector automate its asset management processes.

A image listing the capabilities of UCBOS's platform that can help supply chain automation.

2. Back-office automation 

Back-office tasks can significantly benefit from automation. For example, supply chain management processes contain various documents such as delivery orders, dock receipts, bills of lading (B/L), and sea waybills. Employees in the supply chain department continuously store and process these documents for various reasons, yet, this is a time-consuming, manual task that inhibits businesses from reaching operational excellence. 

Using artificial intelligence (AI) and optical character recognition (OCR), businesses can achieve nearly end-to-end document automation (involving tasks like data capture, understanding information on the document, and sending the document to the relevant person).

Robotic process automation (RPA) can also be used to improve supply chain back-office tasks. According to a survey done on organizations from around the world, 44% of the participants expect RPA to have a significant or moderate impact on supply chains by 2023. They also stated that a careful implementation of RPA can have significant and positive effects on supply chain productivity and efficiency. Therefore, supply chain leaders need to start focusing more on implementing RPA in their supply chain back-office operations.

See how DHL leverages RPA to improve its back-office tasks

3. Transport automation 

Road transportation is the most used mode of logistics in the world. Almost all the products in your kitchen cabinet are brought through road logistics. Currently, the road transport industry is facing a shortage of truck drivers, and predictions indicate that this shortage will worsen in the future. 

Transport automation is a way out of this truck driver shortage crisis. More supply chain leaders are focusing on this solution and investing in transport automation solutions. The autonomous vehicle market is projected to rise from $1.6 billion in 2021 to $11 billion by 2028. Autonomous things such as autonomous trucks and drones can be used to transport supplies in the network. 

Transport automation examples

1. Amazon

Amazon is making substantial investments in autonomous self-driving truck systems and trucks to get ahead of the curve and overcome the driver shortage issue.

2. Tusimple

Tusimple, an American trucking company, has completed 550 miles of driverless trucking and pans to expand its business by 2023. 

3. DHL

Since drone technology enables faster, low-cost, and no-human contact delivery, it is gaining momentum in the post-pandemic last-mile delivery sector. While many unrealistic pilots of drone technology can be seen in last-mile delivery, DHL’S Parcelcopter is ready to successfully mainstream drone technology in last-mile delivery.

4. Nuro

Nuro is a startup building autonomous self-driving delivery vehicles. Nuro is designed for the last-mile delivery of groceries, food, consumer products, and packages. Their custom-designed R2 vehicles don’t have passenger seats; instead, they are optimized for deliveries and safety, which means they’re small, narrow, use electric motors, and have pedestrian-protecting features.

Investing in self-driving trucks can give you a competitive advantage in the logistics and supply chain industry. 

Watch the video below to see how self-driving trucks are revolutionizing the logistics industry by providing cost-effective, fuel-efficient, and sustainable logistics solutions.

Further Reading on automation:

You can check our comprehensive and data-driven lists of supply chain software and suites. And if you still have more questions on supply chain automation, don’t hesitate to contact us:

Find the Right Vendors
Cem Dilmegani
Principal Analyst

Cem is the principal analyst at AIMultiple since 2017. AIMultiple informs hundreds of thousands of businesses (as per Similarweb) including 60% of Fortune 500 every month.

Cem's work focuses on how enterprises can leverage new technologies in AI, automation, cybersecurity(including network security, application security), data collection including web data collection and process intelligence.

Cem's work has been cited by leading global publications including Business Insider, Forbes, Washington Post, global firms like Deloitte, HPE, NGOs like World Economic Forum and supranational organizations like European Commission. You can see more reputable companies and media that referenced AIMultiple.

Cem's hands-on enterprise software experience contributes to the insights that he generates. He oversees AIMultiple benchmarks in dynamic application security testing (DAST), data loss prevention (DLP), email marketing and web data collection. Other AIMultiple industry analysts and tech team support Cem in designing, running and evaluating benchmarks.

Throughout his career, Cem served as a tech consultant, tech buyer and tech entrepreneur. He advised enterprises on their technology decisions at McKinsey & Company and Altman Solon for more than a decade. He also published a McKinsey report on digitalization.

He led technology strategy and procurement of a telco while reporting to the CEO. He has also led commercial growth of deep tech company Hypatos that reached a 7 digit annual recurring revenue and a 9 digit valuation from 0 within 2 years. Cem's work in Hypatos was covered by leading technology publications like TechCrunch and Business Insider.

Cem regularly speaks at international technology conferences. He graduated from Bogazici University as a computer engineer and holds an MBA from Columbia Business School.

Sources:

AIMultiple.com Traffic Analytics, Ranking & Audience, Similarweb.
Why Microsoft, IBM, and Google Are Ramping up Efforts on AI Ethics, Business Insider.
Microsoft invests $1 billion in OpenAI to pursue artificial intelligence that’s smarter than we are, Washington Post.
Data management barriers to AI success, Deloitte.
Empowering AI Leadership: AI C-Suite Toolkit, World Economic Forum.
Science, Research and Innovation Performance of the EU, European Commission.
Public-sector digitization: The trillion-dollar challenge, McKinsey & Company.
Hypatos gets $11.8M for a deep learning approach to document processing, TechCrunch.
We got an exclusive look at the pitch deck AI startup Hypatos used to raise $11 million, Business Insider.

To stay up-to-date on B2B tech & accelerate your enterprise:

Follow on

Next to Read

Comments

Your email address will not be published. All fields are required.

1 Comments
Oliver Harris
Jan 29, 2021 at 05:39

Improving customer experience with your supply chain organization is the most remarkable result of effectively leveraging RPA. Robotic process automation in transportation and logistics can reduce the overall costs and greatly increase efficiency. This is effectively done in processes such as shipment scheduling, invoice processing, order and inventory processing, communication, etc.

Cem Dilmegani
Jan 29, 2021 at 18:19

Thanks! However, we needed to remove the links as per our policy.

Related research