Why Most Logistics Companies Are Automating the Wrong Tasks (And What to Do Instead)

The Unspoken Challenge of Drayage and 3PL

Most logistics companies looking to enable AI are doing it for all the wrong reasons: they want to automate small levers; email notifications, invoicing assignments, and tout this as transformational. But it's clear, in no time, that these efforts save minutes, not hours.

In a world of thin margins and even thinner delivery windows, transformation comes from empowering the identity of the workflow intelligence, not from accomplishment.

Case in Point: Driving AI-Driven Intelligent Dispatch Prioritization

The Challenge: An independent 3PL in Ontario was always playing catch up with unexpected carrier delays and had to prioritize LTL shipments on the fly with manual redirecting - if drivers were present.

The Automated Solution: They deployed AI to generate a real-time dispatch prioritization solution that:

• Automatically prioritized re-redirecting shipments based on:

• Driver availability and access

• Predicted delay likelihood based on traffic, weather, and routing history

• Potential contractual penalties resulting from delayed deliveries

• Load balancing across various facilities

• Real-time equipment statuses at port drop-off locations

  
  

The Results:

• 19% reduction in missed SLA penalties

• 5X quicker determinations for dispatch

• Happier carriers due to more proactive load reassignments

• 12% increase in truck utilization

  
  

What We Generally Disagree With:

"Start small—automate simple admin tasks first."

It's easy to start small. But true ROI resides along the most complex decision trees within logistics. Administrative automation is a Band-Aid—there's no need to save seconds—you need a workflow transformation that addresses the root of the problem.

The antiquated way solves the symptoms, not the disease: ineffective decision-making under extreme duress.

Where You Should Actually Start

If you're serious about undertaking AI automation, here's where to do it within logistics:

1. Document Decision Points Over Tasks:

• Where does human latency cause delays?

• Where do systems break down when key personnel are unavailable?

• What decisions rely on the same dataset again and again?

  
  

2. Document Your Unwritten Rules:

• Your training for AI only matters to how you actually decide something, NOT your operation's documented SOPs.

• Identify the instinctive "feel" factors your best dispatchers use.

• Identify any tribal knowledge that's not necessarily written down but well known by your team.

  
  

3. Train on Real Time Inputs:

• For example, GPS positioning, delivery windows, real-time plant life, and load weight.

• Do not input dummy data or hypothetical scenarios, as these do not represent day-of decisions.

• Train on decisions made multiple times per day.

  
  

4. Avoid Automation for Vanity's Sake:

• Do not automate because it's easy or attainable.

• Understand what factors are marginally impacting customer service vs. profit margin - and align to those.

• Some decisions compound - better routing improves better fuel usage, driver morale, and more accurate on-time deliveries.

  
  

  

  
  

The Controversial Truth About Logistics AI - People want automatic vehicles and warehouse robotics right now. The more seductive middle layer is automating decisions - where gains are faster with less risk. Analyze the data you're already compiling and let that drive your daily decisions without employing any sort of robot or sensor.

Companies winning at logistics don't have access to the most sophisticated technology capabilities; they're making better decisions faster with what they already have.

Where to Go From Here

Stop thinking about AI as task replacement; think about task support decision reinforcement. Your dispatchers aren't going anywhere, but they need an intelligent layer to supplement them every day so that their decisions become ten times better.

Can you afford to empower such transformational capability? Can you afford NOT to revamp the way your operation makes decisions?

Contact Knowbie today for expertise on custom solutions for AI automation fit for your operation - whether it's revenue generation from operations adjustments to discovering better customer service or productivity with intelligent tools, Knowbie can assist with execution and solutions tailored to your needs. Contact us today!