AI has transformed the sector and has helped in saving time, increasing productivity and ensuring accuracy along with cognitive automation at reduced costs.
The logistics sector is considered to be the backbone of the Indian economy. With the pandemic outbreak last year, this unorganized market witnessed various disruptions. The surge in online shopping owing to consumer preference further added to the woes. While the coronavirus caused upheaval in the sector, it also expedited the digital transformation of businesses in the industry.
Supply chain visibility along with catering to the customer needs became the dire need of the hour for the sector to survive. Amidst the instability, the industry embraced digital adoption and initiated its tech journey to function optimally. The players realized that in order to survive and thrive as well as to have a competitive edge in the market, digitization emerged to be the ideal solution.
Technological advancements driving the growth of the logistics segment
Expert Market Research in its recent reports states that the global logistics market size stood at $4,967 billion in 2020. It is anticipated to grow at a CAGR of 5% from 2021 to 2026 and is projected to hit the $6,563.3 billion mark by the end of 2026. The report further points out that the Asia Pacific region specifically India is expected to be the leading logistics market at the global level. This study attributes the exponential growth of the sector to be driven by technological advancements.
Incorporating technology in the logistics sector has revamped the entire landscape of the logistics segment. The visibility of the entire supply chain model has improved and also enabled in better procurement of production and sourcing of materials. Amongst the plethora of technologies available, AI seems to have been gaining prominence.
Artificial Intelligence paving the way for the digital transformation of the logistics sector
Every logistics player, be it a global giant or an e-commerce brand offering same-day or swift delivery, all of them increasingly rely on AI solutions. Artificial Intelligence has enabled players in augmenting their predictive capacities. The technology is being used in optimizing operations through demand forecast, operations planning, route mapping, driver behavior analysis process just to name a few. Its application extends to various other processes and activities in the supply chain model. AI ensures that supply chain information is available in real-time to the logistics companies via IoT-enabled sensors.
Adding to it, the solution enables industrial robotics, especially in warehousing operations. It has made the warehouses agile and market-oriented. Facilitated by Big Data, Machine Learning and predictive capabilities, Artificial Intelligence helps improve operational inefficiencies and inventory processing as well as enables logistics players to earn greater profits. AI further strengthens last-mile optimization, return handling as well as smart batching in warehouses. Robots are already being used in warehouses to move, monitor, and locate inventories. With the power of this new-age tech solution, logistics players can harness the power of data platforms and create datasets to regulate patterns in their supply chain models.
Artificial Intelligence upscaling the logistics market
With Artificial Intelligence, logistics companies have access to important information such as billing amounts, account information, dates, addresses, parties involved from the ocean of unstructured invoices received by the company.
AI has transformed the sector and has helped in saving time, increasing productivity and ensuring accuracy along with cognitive automation at reduced costs. It helps automate the admin tasks which are usually time-consuming and aids in demand forecasting. The solution further enables route optimization which helps in reducing the cost of shipping and helps in garnering greater profits. Intelligent systems capture data and then analyze it to enable players to make informed decisions. McKinsey’s recent report projects this very trend. It states that successfully implementing AI-enabled supply-chain management has enabled early adopters to improve logistics costs by 15%, inventory levels by 35%, and service levels by 65%.
It is due to the digital revolution that the logistics system has become an integrated end-to-end process. Be it, customers, e-commerce, logistics players want an option to track the entire trajectory of products right from their source and transportation to their delivery at the doorstep. This is where technology especially AI helps in the seamless management of supply chain models and resolves challenges with reference to supply chain security, transparency as well as traceability.
Artificial Intelligence has already started gaining prominence in the logistics sector and has been playing an integral role in revolutionizing the market. Robotics along with AI is supporting the logistics market and their adoption will continue to spike in the times to come. Owing to the digital disruption, the future of the Indian logistics sector indeed seems progressive!
Source: Business World