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Supply Chain AI: 25 Current Use Cases (and a Handful of Future Ones)

Published

11 mois ago

4 novembre 2024

Supply Chain Ai: 25 Current Use Cases (and A Handful Of Future Ones)

When it came out, ChatGPT seemed like magic. It has led supply chain vendors to discuss how they currently use artificial intelligence. Further, virtually every supplier of supply chain solutions is eager to explain the ongoing investments they are making in artificial intelligence.

Any device that can perceive its environment and can take actions that maximize its chance of success at some goal is engaged in some form of artificial intelligence. AI is not a new technology in the supply chain realm; it has been used in some cases for decades. More recently, many other cases have emerged.

Optimization is used in supply planning, factory scheduling, supply chain design, and transportation planning. In a broad sense, optimization refers to creating plans that help companies achieve service levels and other goals at the lowest cost. In mathematical terms, optimization is a mixed-integer or linear programming approach to finding the best combination of warehouses, factories, transportation flows, and other supply chain resources under real-world constraints.

Machine Learning occurs when a machine takes the output, observes its accuracy, and updates its model so that better outputs will occur. Demand planning engines have natural feedback loops that allow the forecast engine to learn. The forecast can be compared to what actually shipped or sold.

Since ML began being used in demand forecasting in the early 2000s, ML has helped greatly increase the breadth and depth of forecasting. Now, ML forecasting is not just monthly or quarterly; weekly and even daily forecasting is now possible. We have moved from product-level forecasts at a regional level to stock-keeping unit forecasts made at the store level. More recently, demand planning applications based on machine learning have improved forecasting by incorporating competitor pricing data, store traffic, and weather data.

We are no longer just forecasting demand but also when trucks and factory machinery are likely to break down (predictive maintenance), the optimal amount of inventory to hold and where it should be held (inventory optimization), and labor forecasting in the warehouse. This type of forecasting can forecast the number of employees required to perform estimated work down to the day, shift, job, and zone level. ML can also be used to generate labor standards for warehouse workers.

ML techniques like clustering, data similarity, and semantic tagging can automate master data management. Without accurate data, companies face the garbage in, garbage out problem.

In terms of supply planning, if key parameters (like supplier lead times) are no longer correct, then the planning becomes suboptimal. ML is being used to keep key parameters and policies up to date. It is also being used to predict whether an SKU believed to be in stock at a store is actually out of stock.

Supply chain risk solutions use ML and other forms of AI to predict which suppliers are included in a company’s multi-tier supply chain. This is becoming increasingly necessary as customs will hold up shipments at the port if it believes the shipment contains products made with slave labor from China, even if those components came from their supplier’s supplier’s supplier and represent a minuscule portion of the total cost of the product. Shippers’ end-to-end supply chain predictions are based on applying AI to OpenWeb searches, import/export records, data from sourcing platforms like ThomasNet, federal logistics records, and other data. These predictions accelerate a company’s ability to verify how its extended supply chain is constructed. Customs uses the same technology to determine which shipments should be denied entry.

Natural Language Processing is used to classify commodity classification for use in imports and exports and in real-time supply chain risk solutions.

The Harmonized System is a commodity classification coding taxonomy that forms the basis upon which all goods are identified for customs. It is used by customs authorities worldwide. Using the right product classification allows companies to pay the correct tariffs. Paying the right tariffs is necessary to avoid government fines and calculate the true landed cost of products. The problem is that there is an incredible gap between how products are described commercially and how they are expressed in the national customs tariff schedules. This has resulted in error rates as high as 30%. The combination of natural language processing and expert systems has been used to automate and significantly improve the classification process.

Real-time risk solutions also use natural language processing to read online publications and other data sources, make sense of what they read, contextualize the data into information, and report supply chain disruptions caused by weather, geopolitical events, and other hazards in near real-time. Every step in that value chain has search terms associated with it. The names of the suppliers, carriers, logistics service providers become search terms. Those search terms are paired with terms signaling a problem – those terms might be “bankruptcy,” “plant fire,” “port explosion,” “strike”, and many, many other terms. So, the term “Haiphong” when combined in an article with the phrase “port fire” would generate an alert.

Reinforcement Learning is a form of machine learning that lets AI models refine their decision-making process based on positive, neutral, and negative feedback. For example, if you want to train a vision system to recognize a dog’s image, you will start by using humans to look at tens of thousands of images of animals. The humans label the pictures as dog, not dog, or unclear. The computer is then presented with those images. The system would say, “this is a dog” or “this is not a dog” and it learns whether its conclusion was correct.

Drones use this form of AI to improve inventory accuracy in a warehouse. Reinforcement learning allows the drone to recognize warehouse racks, pallets, and cases and get close enough to inventory to scan the barcodes. Similarly, reinforcement learning has been applied to security camera footage in the warehouse to ensure workers are following standard operating procedures.

Simultaneous localization and mapping (SLAM) allows a vehicle to construct and update a map of an unknown environment while simultaneously keeping track of the vehicle’s location within it. This technology allows mobile robots to move autonomously through a warehouse.

Drones and autonomous mobile robots using SLAM are in an early adoption stage for last-mile deliveries. Autonomous trucks will revolutionize logistics.

Autonomous trucks are not yet feasible, but we are probably just a couple of years out from being able to transport goods from a distribution center to a retail facility autonomously.

Causal AI is a technique in artificial intelligence that builds a causal model and can make inferences using causality rather than just correlation. Cause-and-effect relationships in an extended supply chain can be an intricate web that is difficult to unravel, but these relationships govern business operations. A causal model graph represents a network of interconnected entities and relationships, enabling the system to understand how various factors influence each other to create an optimized outcome. By leveraging causal knowledge and data graphs, Causal AI can navigate complex business scenarios, anticipate outcomes, and recommend optimal courses of action. Georgia-Pacific has demonstrated an application of Causal AI to improve touchless commerce dramatically. The solution was used to detect and correct both common and uncommon order errors or discrepancies in near real-time.

GenerativeAI is the new kid on the block. GenAI can generate text, images, videos, or other data using generative models. Some warehouse management suppliers are exploring using GenAI to generate end-of-shift reports or talking points used at standup meetings at the beginning of a shift.

Several supply chain application vendors are investing in GenAI to improve their user interfaces. The idea is that a user will make a request, and the system will take them directly to the answer they seek. GenAI can also help interpret complex charts and planning outputs. If a planning system indicates that a plan shows high costs or an inability to achieve targeted service levels, GenAI can help explain the upstream constraints driving that outcome.

Planning vendors are also interested in using GenAI to solve the black box problem. The black box problem occurs when planners don’t understand how the planning engine produced the plan it did. If they don’t understand it, they don’t trust it, and they then produce a much less optimal plan using Excel.

In the longer term, GenAI will help some planning vendors generate autonomous plans. When disruptions constantly occur, there is no time to constantly create and analyze scenarios on how to react best. Autonomous planning can improve a company’s supply chain agility. However, it is worth noting that a few planning suppliers can already generate autonomous plans based on ML and attribute-based planning rather than having to rely on GenAI.

The post Supply Chain AI: 25 Current Use Cases (and a Handful of Future Ones) appeared first on Logistics Viewpoints.

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Federal Industrial Partnerships and Supply Chain Realignment Under the Trump Administration: Pharmaceuticals, Semiconductors, Critical Minerals, and Energy

Published

2 jours ago

3 octobre 2025

Federal Industrial Partnerships And Supply Chain Realignment Under The Trump Administration: Pharmaceuticals, Semiconductors, Critical Minerals, And Energy

In the months leading up to the 2026 midterm elections, the Trump administration has launched a broad initiative to negotiate agreements with companies across as many as thirty industries. According to reporting from Reuters and other outlets, these deals involve a range of mechanisms, including tariff relief, equity stakes, revenue guarantees, and regulatory adjustments.

The purpose of the initiative, according to administration officials, is to strengthen U.S. national and economic security by encouraging companies to expand production domestically, reduce reliance on China, and ensure the availability of critical products.

For logistics and supply chain leaders, this represents a significant change in the relationship between government and industry. Federal agencies are no longer simply regulators or supporters of infrastructure. They are becoming active participants in corporate strategy, investment, and supply chain design.

Structure of the Deals

The administration’s approach is not uniform. Each agreement varies depending on the sector and company involved. Examples include:

Pharmaceuticals: Eli Lilly was asked to expand insulin production, Pfizer was pressed to increase output of its cancer and cholesterol drugs, and AstraZeneca was encouraged to establish a new U.S. headquarters. In exchange, companies have been offered tariff relief or regulatory flexibility.
Semiconductors: A portion of grants provided under the CHIPS Act has been converted into equity stakes, including a reported 10 percent stake in Intel.
Critical Minerals: The Department of Defense took a 15 percent stake in MP Materials, secured a floor price for future government purchases, and facilitated a $500 million supply agreement between MP Materials and Apple for rare earth magnets.
Energy: The Department of Energy has asked companies such as Lithium Americas for equity stakes in exchange for federal loans supporting domestic mining and battery production.

The unifying theme is the use of federal leverage, such as tariffs, financing programs, or regulatory approvals, to secure commitments from private companies that align with stated national security objectives.

Agencies as Dealmakers

What distinguishes this initiative is the scale of inter-agency involvement. The White House has described the approach as “whole of government.”

The Department of Health and Human Services is leading negotiations in pharmaceuticals.
The Department of Commerce, under Secretary Howard Lutnick, has overseen transactions in steel, semiconductors, and industrial manufacturing.
The Department of Energy is linking financing programs to equity arrangements in energy and mining.
The Pentagon has led negotiations with defense contractors and suppliers of critical minerals.

Senior officials, including White House Chief of Staff Susie Wiles and supply chain coordinator David Copley, are directly involved in negotiations. The presence of Wall Street dealmakers, such as Michael Grimes (formerly of Morgan Stanley) and David Shapiro (formerly of Wachtell, Lipton, Rosen & Katz), illustrates the administration’s transactional orientation.

Financing Mechanisms

The administration is using multiple sources of capital to finance these arrangements:

International Development Finance Corporation (DFC): Originally designed to support development projects abroad, the DFC has proposed expanding its budget authority from $60 billion to $250 billion. If approved by Congress, it would fund projects in infrastructure, energy, and critical supply chains within the U.S.
Investment Accelerator (Commerce Department): Seeded by $550 billion pledged by Japan as part of a bilateral trade agreement, this entity will direct capital into U.S. strategic sectors, serving as a replacement for an earlier proposal to establish a sovereign wealth fund.
Existing Programs: Agencies are repurposing funds from programs such as the CHIPS Act and Department of Energy loan guarantees, often converting grants into equity holdings.

Together, these mechanisms represent one of the largest coordinated federal interventions in U.S. industrial and supply chain development in recent decades.

Implications for Supply Chains

The administration’s policies carry several direct consequences for logistics and supply chain management.

1. Reshoring of Manufacturing

Many of the deals include explicit requirements for expanded U.S. production. This will increase demand for domestic transportation, warehousing, and distribution capacity. It also implies higher utilization of U.S. ports and intermodal corridors, as inputs shift from finished imports to raw materials and intermediate goods requiring processing inside the United States.

2. Critical Minerals and Energy Security

The focus on rare earths, lithium, and other inputs for advanced manufacturing indicates a restructuring of upstream supply chains. Logistics providers should expect increased flows from domestic mining regions, such as Nevada’s Thacker Pass lithium project, to processing and manufacturing centers. This represents a shift away from reliance on Asian supply hubs, particularly China.

3. Government as Stakeholder

Equity stakes and long-term purchase agreements create a different operating environment. Logistics providers serving these industries may find demand more stable due to government-backed contracts. However, these arrangements may also impose compliance requirements and reduce flexibility in adjusting supply networks.

4. Public-Private Coordination

Federal involvement in freight and industrial infrastructure financing could accelerate long-delayed projects. Rail expansion, port upgrades, and domestic warehouse capacity may benefit from this investment. Companies positioned to partner on these projects may see long-term opportunities.

Risks and Concerns

Several risks accompany this shift:

Policy Reversal: Executives have expressed concern that a future administration could unwind or renegotiate these deals. Supply chains built around government-backed agreements may face uncertainty if political priorities shift.
Equity Demands: Some companies are wary of ceding ownership stakes to the federal government. This creates hesitation in sectors where ownership control and investor confidence are sensitive.
Market Distortions: Critics argue that selecting which companies receive government support could disadvantage firms excluded from the arrangements, altering competitive dynamics within industries.
Implementation Capacity: The scale of proposed financing, particularly the expansion of the DFC, requires congressional approval and capable management. Delays or political opposition could slow execution.

Policy-to-Supply-Chain Impact Table

Policy Mechanism
Industry Example
Government Action
Supply Chain Impact

Tariff Relief
Pharmaceuticals (Pfizer, Eli Lilly)
Tariff exemptions in exchange for expanded U.S. production
Increases demand for domestic warehousing, distribution, and cold-chain logistics for added output

Equity Stakes
Intel (10% stake), MP Materials (15% stake)
Federal ownership through converted grants or Defense Production Act
Creates long-term stability in supply flows, but may add compliance requirements for logistics providers

Purchase Guarantees
MP Materials with Apple
Pentagon set floor prices, Apple committed to $500M supply contract
Locks in demand for rare earth shipments, increasing domestic transport flows from mining to manufacturing

Federal Loans Linked to Equity
Lithium Americas (DOE loan, 5–10% stake requested)
Loan support tied to partial government ownership
Supports new mining and battery projects, creating future logistics demand for raw materials and finished batteries

Investment Accelerator Funding
Commerce Department
$550B in financing, partly funded by Japan, allocated to U.S. manufacturing and freight infrastructure
Potential expansion of ports, intermodal rail, and distribution centers, reducing bottlenecks in supply chains

Expanded DFC Financing
Multiple critical industries
Proposed budget growth from $60B to $250B for U.S. supply chains and infrastructure
Large-scale capital for freight corridors, warehouses, and strategic materials, enabling reshoring of production

Case Examples

MP Materials

The rare earth mining company received federal backing through a 15 percent Pentagon stake, floor pricing commitments, and a supply agreement with Apple. This illustrates the administration’s template: equity participation, purchase guarantees, and private-sector co-investment.

Intel

The conversion of CHIPS Act funding into a 10 percent federal equity stake in Intel highlights the new approach to semiconductor supply chain security. By tying financial support to ownership, the government ensures both accountability and a direct role in strategic sectors.

Lithium Americas

A Department of Energy loan of $2.26 billion, paired with negotiations for a 5 to 10 percent federal equity stake, demonstrates how energy supply chains, particularly those tied to electric vehicles and batteries, are being secured through mixed financing and ownership arrangements.

Long-Term Outlook

The administration’s strategy marks a departure from the traditional U.S. model of private-sector–led industrial development. Instead, it resembles coordinated industrial policies pursued in other economies, though with American characteristics.

For supply chain professionals, this means that:

Government will play a larger role in shaping sourcing, production, and distribution decisions.
Access to federal financing and contracts will become a key factor in strategic planning.
Logistics infrastructure may receive substantial investment, creating new opportunities for providers.
Companies must assess political as well as market risks when designing long-term supply chains.

The Trump administration’s pre-midterm industrial deals reflect a significant realignment of government and industry roles in the United States. By leveraging tariffs, financing programs, and direct equity stakes, the federal government is reshaping supply chains across pharmaceuticals, energy, critical minerals, and freight.

The initiative is intended to secure domestic production, reduce reliance on China, and ensure access to strategic inputs. For logistics leaders, the result will be increased reshoring activity, new demand for domestic infrastructure, and closer integration of supply chains with federal priorities.

At the same time, risks remain. The durability of these arrangements depends on political continuity, effective implementation, and the willingness of companies to partner with government under new terms.

In this evolving environment, logistics and supply chain professionals will need to monitor policy developments as closely as they do market trends. Supply chains are no longer shaped solely by efficiency and cost considerations. They are now integral to the nation’s industrial strategy.

The post Federal Industrial Partnerships and Supply Chain Realignment Under the Trump Administration: Pharmaceuticals, Semiconductors, Critical Minerals, and Energy appeared first on Logistics Viewpoints.

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Supply Chain and Logistics News Sept 29 – Oct 2nd 2025

Published

2 jours ago

3 octobre 2025

Supply Chain And Logistics News Sept 29 – Oct 2nd 2025

This week in supply chain news, major companies are demonstrating a mix of strategic adaptations and responses to global pressures. ExxonMobil and Kinaxis are collaborating to develop a next-generation supply chain management solution specifically for the complex oil and gas industry, aiming to increase resilience and provide comprehensive visibility. In a push for network efficiency, FedEx has launched a new direct cargo flight between Dublin, Ireland, and Indianapolis, Indiana, bypassing congested coastal hubs to reduce transit times. The pharmaceutical sector is also focused on resilience, with Eli Lilly and Amgen announcing significant U.S. manufacturing investments to bring critical drug production back to North America. Conversely, General Mills is restructuring its supply chain by closing three manufacturing plants in Missouri as a cost-saving measure in response to changing consumer spending habits. Finally, the U.S. government is imposing new tariffs on imported wood products and furniture, effective October 14, 2025, in a move to address what it identifies as a threat to the domestic industry and supply chain security.

The News of the Week:

ExxonMobil and Kinaxis are Developing a Next-Generation Supply Chain Management Solution for Oil and Gas

The oil and gas industry supply chain is one of the most complex in the world. It involves myriad complex production assets both onshore and offshore, transporting highly volatile products around the globe through pipelines, tank farms, ports, ships, rail, and truck. The end product could be gasoline, petrochemicals, natural gas, hydrogen, or any of hundreds of products from asphalt to motor oil. Disruptions to the oil and gas supply chain can have serious consequences for end users. The industry needs more comprehensive supply chain solutions that increase resilience, provide complete visibility across all aspects of the supply chain, and enable swift responses to business challenges and opportunities. Kinaxis and Exxon are collaborating to digitalize various sectors of Exxon’s business. They aim to leverage Kinaxis’s Maestro software to enhance planning and decision-making processes. Through this collaboration, the two companies aim to share solutions tailored to the oil and gas industry, which currently lacks supply chain management solutions that cater to their specific needs.

FedEx Expands Global Air Network with New Dublin- Indianapolis Route

In an effort to shorten transit times and strengthen its international network, FedEx has launched a new direct cargo flight between Dublin, Ireland, and Indianapolis, Indiana. The new four-day-a-week service bypasses traditional, more congested coastal gateways, which is expected to reduce shipping times by a full day for goods moving between Ireland and the U.S. Midwest. This strategic expansion is a response to the growing trade between the two regions and demonstrates how major carriers are adapting their networks to create more direct and efficient routes to meet evolving customer demands.

Eli Lily and Amgen Announce Massive U.S. Manufacturing Investments

In a major push for domestic drug production, pharmaceutical giants Eli Lilly and Amgen have announced huge investments in new U.S. manufacturing facilities. Eli Lilly is planning a new $6.5 billion factory in Houston, while Amgen is expanding its Puerto Rico plant with a $650 million investment. These moves are a direct response to the global supply chain vulnerabilities exposed in recent years and represent a significant effort to boost the resilience of the U.S. pharmaceutical supply chain. The investments aim to bring critical drug production back to North America, creating jobs and reducing reliance on overseas manufacturing.

General Mills is Closing Three Manufacturing Plants in Missouri

General Mills is closing three manufacturing plants in Missouri—a pizza crust facility in St. Charles and two pet food locations in Joplin—as part of a multiyear supply chain restructuring effort. The company expects to incur $82 million in restructuring charges, including asset write-offs and severance costs. This action is part of a broader trend among food and beverage companies to implement cost-saving measures in response to consumer spending pullbacks. The closures follow previous organizational actions by General Mills, such as job cuts and the closure of its innovation unit, and are intended to improve the company’s competitiveness.

US to Begin Furniture, Wood Import Tariffs on Oct. 14

New tariffs on imported wood products, including furniture, will take effect on October 14, 2025, following a Section 232 national security investigation. The initial duties will be 10% on softwood lumber and 25% on upholstered furniture, kitchen cabinets, and vanities. On January 1, the tariff rates are scheduled to increase to 30% for upholstered furniture and 50% for kitchen cabinets and vanities. The executive order provides for lower tariff caps for imports from specific trading partners, such as the U.K., Japan, and the European Union. These new tariffs are intended to address what the administration has identified as a threat to domestic industry and supply chain security.

Song of the week:

The post Supply Chain and Logistics News Sept 29 – Oct 2nd 2025 appeared first on Logistics Viewpoints.

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Call for Speakers: Ready to Drive Real Change in Intelligent Operations and Resilient Supply Chains – ARC Industry Forum 2025

Published

3 jours ago

2 octobre 2025

Call For Speakers: Ready To Drive Real Change In Intelligent Operations And Resilient Supply Chains – Arc Industry Forum 2025

Call for Speakers – ARC Industry Forum 2025

The ARC Industry Forum is the premier event where operations, supply chain, and technology leaders gather to shape the future of intelligent and resilient enterprises. In 2025, supply chains face unprecedented disruption, but also unmatched opportunity. We are seeking speakers—executives, practitioners, and innovators—who can share strategies, frameworks, and real-world experiences to inspire and guide their peers.

Sample Session Themes

To help illustrate the types of topics we feature, here are a few recent examples:

The New Frontier of Operations and Supply Chain: AI, Resilience, and Intelligence – Exploring how AI, analytics, automation, and connected intelligence converge to deliver agility and resilience.
Building Resilient Supply Chains in the Age of Shifting Geopolitics – Addressing the regulatory, tariff, and policy challenges facing global supply networks.
Unlocking the Power of Knowledge Transfer in Enterprise Systems – Showcasing best practices to fully leverage enterprise and knowledge management systems.

These examples are only a sample of the many tracks available. Additional sessions will cover digital transformation, sustainability, cybersecurity, workforce strategies, and other timely topics.

Submission Guidelines

We invite proposals that highlight real-world case studies, practical lessons, and strategic frameworks. Presentations should be vendor-neutral, educational, and tailored for an audience of senior executives and practitioners.

If you are interested in speaking, please submit:

A proposed session title and abstract (150–250 words)
Key takeaways for attendees
Speaker bio and organizational role

To submit a proposal, or simply for more information, contact us now

The post Call for Speakers: Ready to Drive Real Change in Intelligent Operations and Resilient Supply Chains – ARC Industry Forum 2025 appeared first on Logistics Viewpoints.