AI: Companies turn to technology to manage chains – 08/18/2023 – Tech

Some of the world’s biggest companies are turning to artificial intelligence to navigate increasingly complex supply chains as they tackle the impact of geopolitical tensions and pressure to eliminate links to environmental and human rights abuses.

Unilever, Siemens and Maersk are among companies using artificial intelligence to negotiate contracts, find new suppliers or help identify those linked to issues such as the alleged crackdown on Uighur Muslims in China’s Xinjiang region.

While AI has been used to help manage supply chains for years, the development of so-called generative artificial intelligence technology is offering new opportunities to further automate the process.

More and more multinationals are grappling with the need to stay informed about their suppliers and customers amid disruptions during the pandemic and heightened geopolitical tensions.

New supply chain laws in countries such as Germany, which require companies to monitor environmental and human rights issues in their supply chains, have boosted interest and investment in the area.

Navneet Kapoor, Maersk’s vice president of technology, said “things have changed dramatically in the last year with the advent of generative artificial intelligence”, which can be used to create chatbots and other software that generate responses to human requests.

In December, the world’s second-largest container shipping group entered a $20 million capital round for Pactum, a San Francisco company that says its ChatGPT-like bot has been negotiating contracts with suppliers for Maersk, Walmart and the distribution group Wesco.

“When there’s war, Covid or supply chain disruption, you need to get in touch with suppliers,” said Kaspar Korjus, one of the founders of Pactum, who said the startup’s chatbot had been negotiating contracts worth up to $1 million on behalf of “dozens” of Fortune 500 companies. “.

Like other multinationals, the German industrial conglomerate Siemens has accelerated efforts to reduce its reliance on Chinese suppliers.

Since 2019, Siemens has employed the services of Scoutbee, a Berlin startup that this year launched a chatbot capable, according to it, of responding to requests to locate alternative suppliers or vulnerabilities in a user’s supply chain. “The geopolitical aspect is an important topic for Siemens,” said Michael Klinger, a supply chain executive at the company.

Scoutbee Chief Executive Gregor Stühler said Unilever, another customer and maker of Marmite edible spread and Magnum ice cream, was also able to identify new suppliers when China went into lockdown during the pandemic.

Evan Smith, chief executive of New York startup Altana, said the company, whose customers include Danish shipping group Maersk as well as US border authorities, had analyzed customs declarations, shipping documents and other data to build a map that connects 500 million businesses around the world.

Customers can use its AI-enabled platform to track products from suppliers in Xinjiang, Smith added, or track whether their own products are being used in Russian weapons systems.

“Just to start, building the map required us to connect billions of data points in different languages. The only way to work with this volume of raw data is artificial intelligence.”

Up to 96% of supply chain professionals are planning to use AI technology, according to a survey of 55 executives conducted this month by logistics group Freightos, although only 14% are already using it.

Nearly a third of respondents believe that the use of artificial intelligence would lead to significant job cuts at their companies, adding to concerns about the technology’s impact on job security.

Translated by Paulo Migliacci