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Predictive Algorithms in Supply Chain



Today's world generates massive amounts of data, much more than could ever be analyzed by people. However, Artificial Intelligence programs armed with predictive algorithms may just be able to sort through the data we create to help us become more efficient in our supply chains. These algorithms are designed to identify patterns within the data generated by supply chains - be it our own supply chain, or the supply chains of the world. Once a pattern is recognized, the AI machine is able to identify the likely outcome if the first few steps of the pattern occur. 

In logistics, predictive algorithms are being used in a variety of ways. Most commonly, AI is used to identify when orders are likely to be placed and what is likely to be in those orders, before they happen. This is done by analyzing the pattern of orders placed, and determining how quickly your customers are likely to need more of a certain type of product. This helps you to ensure that you have the products available when they are likely to be needed and can prepare for the order in advance. 

Other uses of AI in logistics and supply chains is the use of predictive algorithms in route optimization. These algorithms identify patterns in time and distance traveled within routes to identify areas of inefficiency which can be improved. AI can also help to determine when to anticipate increased traffic or congestion on the roads, allowing for routes to be scheduled around these times if possible. 

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