Do More with Less: Assist, Augment, and Automate Work with AI

We’ve got a challenge on our hands: the demand for national production is on the rise, but the availability of skilled labor in the distribution and manufacturing sectors is dwindling. How do we tackle this? By boosting the productivity of our existing workforce.

Solving the Distribution Productivity Problem

The wholesale distribution sector thrived during the 1990s and 2000s but hit a stagnation point about 15 years ago. While this is unfortunate, it presents a unique opportunity for innovation today. One key reason for this stagnation is the underinvestment in technology. Many distribution segments have been slow to adopt new software, relying on core operating systems from the 1980s.

But this is changing. We are on the brink of a Distribution Renaissance with the mass adoption of AI, pushing these sectors to embrace new technology at an unprecedented rate. Instead of picturing dark warehouses, autonomous delivery trucks, and robotic order picking, think of a more iterative transition. This transformation will integrate into current systems and leverage the strengths of today's workforce, ushering in a new era of productivity, resiliency, and enhanced capabilities.

Operating at “Top of License”

The concept of working at “top of license” is crucial in healthcare, where every worker performs the most impactful work they are licensed to do. This concept is equally applicable to the distribution sector. For instance, an experienced Warehouse Manager designs workflows that Warehouse Associates implement, or a seasoned Customer Service Rep handles complex inquiries while newer reps manage data entry. Ensuring everyone operates at “top of license” maximizes efficiency and quality while minimizing costs.

AI-in-Action: Returns Management

Example 1: Customer Service

• Manual Process: Ted, a customer service representative, spends four hours processing return requests and handling customer inquiries.
• AI Assists: Ted uses AI to verify return eligibility and respond to common inquiries, cutting his processing time to two hours.
• AI Augments: AI analyzes customer interactions and suggests responses in real-time, reducing Ted’s time to 30 minutes per interaction.
• AI Automates: AI autonomously handles basic customer service tasks, allowing Ted to focus on more complex issues and customer relations.

Example 2: Supply Chain Management

• Manual Process: Liz, in procurement, manually tracks parts orders and updates schedules.
• AI Assists: AI processes supplier emails and alerts Liz to updates.
• AI Augments: AI suggests schedule updates based on supplier responses.
• AI Automates: AI autonomously handles supplier communications and schedule updates, while Liz focuses on troubleshooting.

Identifying the Right AI Applications for Distribution Sectors

When considering AI applications, evaluate:

• Infrastructure Readiness: Ensure your organization has the necessary data and workflows.
• Cultural Readiness: Assess the organization's willingness to adopt new technology.
• Cost-Benefit Considerations: Determine the ROI, balancing efficiency, quality, and capability improvements against costs and risks.
  
  

Transforming Returns, Warranties, and Repairs with AI

For returns, warranties, and repairs, AI can revolutionize processes by:

• AI-Assisted Returns Management: AI helps customer service reps by verifying return eligibility and processing returns more quickly.
• AI-Augmented Warranty Claims: AI analyzes warranty claims data to identify patterns and predict issues, enabling proactive maintenance.
• AI-Automated Repairs: AI-driven diagnostics can autonomously identify and initiate repairs, reducing downtime and increasing efficiency.
  
  

Final Thoughts

By adopting a thoughtful approach and aligning AI applications with customer incentives, we can enhance productivity, profitability, and worker fulfillment in distribution settings. Embrace AI not as a replacement, but as a tool to empower your workforce to operate at their highest potential. The future of distribution sectors lies in the seamless integration of AI to boost productivity and drive innovation.