The future of smart logistics: Harnessing AI, IoT & blockchain: Rohit Chaturvedi

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The future of smart logistics: Harnessing AI, IoT & blockchain: Rohit Chaturvedi

The future of smart logistics: Harnessing AI, IoT & blockchain: Rohit Chaturvedi

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Nov 26,24

GenAI can make adoption even faster by conversing in natural languages with humans.

The future of smart logistics: Harnessing AI, IoT & blockchain: Rohit Chaturvedi

While the future of smart logistics looks promising, realising its full potential requires industry-wide collaboration. Stakeholders must work together to invest in infrastructure, share best practices, and establish standards that promote interoperability and trust, says Rohit Chaturvedi, Partner, Transport and Logistics sector leader, Government, Infrastructure and Development Sector Advisory Services, Forvis Mazars India.

The logistics & supply chain industry has been the backbone of global trade for centuries, evolving from manual tracking systems to sophisticated supply chain networks. However, traditional logistics practices often struggle with inefficiencies, delays, and a lack of transparency. This leads to unnecessary costs and customer dissatisfaction. Today, a technological revolution is reshaping the landscape. Emerging technologies like Artificial Intelligence (AI), the Internet of Things (IoT), and blockchain are redefining logistics by optimising operations, enabling real-time tracking, ensuring data security, and fostering transparency across the supply chain, making it smarter, faster, and more reliable.

The role of AI in smart logistics

AI is at the forefront of revolutionising logistics by introducing advanced capabilities that optimise processes: Generative AI or GenAI is enabling even more creative solutions to enhance profitability and increasing customer satisfaction.

GenAI can make adoption even faster by conversing in natural languages with humans. For example, data collected from IoT and other sources can be queried by a human without any technical background. The GenAI enabled apps can query different sources of data and info and combine them to output the answer to the query. It is also easier for the developers as the explicit programming of all scenarios will be replaced by GenAI ‘s enhanced prowess. Few of the use cases of AI in general and GenAI in particular are:

• Predictive analytics: AI empowers logistics companies with the ability to forecast demand accurately. By analysing historical data and market trends, businesses can reduce wastage, optimise inventory, and avoid stockouts or overstocking. For instance, retailers can ensure products are always available during peak seasons while minimising surplus thus making the supply chain more efficient. Companies can also benefit through better transport management by choosing the right vehicles and right contract (spot, long term, etc.) on different routes and at different times of year.

• Route optimisation: Machine learning algorithms enable AI to identify the most efficient delivery routes, factoring in traffic, weather conditions, and fuel consumption. This not only ensures timely deliveries but also cuts down transportation costs significantly. Companies like DHL and FedEx have already implemented AI-powered routing systems, witnessing notable improvements in efficiency. Route optimisations include choice between point to point deliveries, milk runs, hub and spoke models etc.

• Automation in warehousing: Robotics and AI have revolutionised warehouse operations by automating repetitive tasks such as sorting, picking, and packing. AI-driven robots work alongside human employees to streamline workflows, minimise errors, and boost productivity, paving the way for fully automated smart warehouses.

IoT’s impact on logistics

IoT has brought unparalleled connectivity to the logistics industry, creating a seamless flow of real-time information:

• Real-time tracking: IoT-enabled sensors provide live updates on shipment locations, allowing businesses and customers to track packages with precision. This level of visibility enhances customer trust and enables proactive decision-making in case of delays.

• Condition monitoring: IoT devices ensure the safe transportation of sensitive goods such as perishable food or pharmaceuticals. These sensors monitor parameters like temperature, humidity, and vibration, sending alerts when conditions deviate from the desired range, preventing spoilage and loss.

• Fleet & equipment management: IoT integration into vehicles allows for real-time tracking, predictive maintenance, and fuel optimisation. Fleet managers can monitor vehicle health and driver behaviour, reducing downtime and operational costs.

Blockchain: Enabling transparency and trust

Blockchain has the potential to transform logistics by addressing long-standing issues of transparency and security within supply chains. However, the progress has been slow due to a variety of technical and governance factors . Few of the use cases are :

• Enhanced supply chain visibility: Blockchain’s immutable ledgers enable stakeholders to track goods at every stage of the supply chain in a tamper-proof way, ensuring accountability and reducing fraud. This transparency is especially crucial in industries like food and pharmaceuticals, where traceability is of prime importance.

• Smart contracts: By automating agreements between parties, blockchain may eliminate the need for intermediaries and paperwork. Payments, approvals, and shipment updates can occur automatically upon meeting predefined conditions, reducing disputes and saving time. Walmart Canada, in collaboration with DLT Labs, demonstrated this by using blockchain and IoT to improve billing accuracy for third-party trucking providers. This initiative reduced billing disputes from 70% to less than 5%, leading to significant cost savings and faster payment processing.

• Fraud prevention and security: Blockchain technology secures data and minimises the risks of counterfeit goods entering the supply chain. With encrypted transactions and decentralised ledgers, it becomes nearly impossible to alter records, bolstering trust among stakeholders.

Synergies between AI, IoT, and blockchain

The combined power of AI, IoT, and blockchain is unlocking new possibilities for logistics:

• Data collection and analysis: IoT devices generate vast amounts of data in real time. AI analyses this data to predict trends, optimise processes, and enhance decision-making. Meanwhile, blockchain ensures that the data remains secure and tamper-proof, fostering trust across the network.

• A connected ecosystem: Imagine a logistics ecosystem where IoT sensors track goods, AI predicts the best shipping routes, and blockchain maintains an unalterable record of the entire process. Such integration leads to unparalleled efficiency, cost savings, and customer satisfaction.

• Future implications: The synergy of these technologies is poised to create self-sustaining supply chains as we call it Supply Chain 3 (SC3) at Forvis Mazars. Businesses can respond dynamically to disruptions, enhance sustainability efforts, and deliver exceptional value to customers.

The way forward

Several trends are accelerating the adoption of smart logistics. The surge in online shopping and the demand for faster last-mile deliveries are pushing logistics companies to adopt smarter, more scalable technologies. Moreover, the focus on reducing carbon footprints is also driving innovation in logistics, with AI, IoT, and blockchain playing a critical role in creating greener supply chains.

There are few other challenges such as the costs of implementing the technology solutions needed to meet strict ROI conditions given the logistics & supply chain are usually cost-centres. In addition, use of new technologies such as AI and blockchain may have an impact on the green goals of companies through their supply chains and for the companies running logistics businesses. Lastly, the companies need to look beyond the traditional roles of the supply chain professionals with evolved hiring mindset & suitable organisation, systems and processes.

In conclusion, embracing AI, IoT, and blockchain is no longer optional for logistics companies — it is essential for future-proofing operations and staying ahead in an increasingly competitive market.

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About the author:

Rohit Chaturvedi is a Partner and Transport and Logistics Sector Leader at Forvis Mazars India, brings over 21 years of professional experience across multinational and multicultural settings. He played a role in building the Transport & Logistics vertical at CRISIL from the ground up. Over his career, he has led more than 200 studies in logistics, ports, and roads, delivering strategic insights and solutions.