3PLs and AI – A Historical Combination

3PLs and AI –  A Historical Combination

I am not much for predictions, but here’s one you can bank on: When artificial intelligence (AI) is truly applied to logistics operations, that combination will be a defining moment like few that have come before.

I believe that the use of AI in logistics will be as impactful as these historical developments in U.S. freight transportation history:

  • The Transcontinental Railroad that connected the East and West Coasts (1869).
  • Almost 90 years later, the creation of the U.S. Interstate Highway System (1956) that connected most everywhere else.
  • The patenting of the shipping container leading to intermodalism, envisioned by trucker Malcom McLean (1956 again), efficiently connecting America to the world.
  • The Amazon effect. Jeff Bezos’s online bookstore ignited an ecommerce revolution that changed all aspects of transportation, connecting everything to everyone’s home.

Yes, there is a lot of hype about what AI can do. But I am not talking about ChatGPT or Google’s Bard version of consumer-facing AI. I mean specialized applications written for transportation, logistics, and supply chain management. In two years or less, 3PLs will have deployed customer-facing AI-driven solutions that will rival, or better said, build on, those watershed moments in U.S. transportation history.

I am not alone in this opinion—84% of 3PLs responding to our annual survey on the third-party logistics market say AI is the most impactful technology they can use. That is the highest percentage of tech use ever reported in the 20+ years we have been conducting our 3PL market research survey.

Why do 3PL respondents overwhelmingly say that AI is the most impactful technology ever? Because they see what I see: external and internal applications of AI-driven solutions.

The external customer-facing applications are the more exciting benefit, one where the 3PL’s AI expertise is applied to remaster their customers’ supply chains to drive improvements in their overall business process and, by extension, the ability to serve their customers’ customers even more efficiently.

3PLs already are building internal AI solutions to address their operations, and to build out networks to connect with new partners. It won’t be too long before the offerings to their customers materialize, going beyond traditional logistics and supply chain solutions…to what? To guidance, advice, and consulting, which will truly drive transformational enterprise change.

Beyond the practical solutions, AI will unleash the creativity of “what is possible?”