New laws now make it mandatory for companies to monitor environmental and human rights abuses in their supply networks. As a result, multinationals are turning to artificial intelligence (AI) to navigate the growing complexity of their supply chains.
Unilever, Siemens, and Maersk are already using AI to negotiate contracts, find new suppliers, and even identify those connected to the alleged repression of Uyghur Muslims in China’s Xinjiang region. Generative AI is offering more opportunities to further automate the process of keeping abreast of suppliers amid disruptions, including geopolitical tensions.
New supply chain laws in Germany now require companies to monitor environmental and human rights issues in their supply chains. And, in December, the world’s second-largest container shipping group helped provide $20mn in funding for Pactum, a San Francisco business that says its ChatGPT-like bot is negotiating contracts with suppliers for Maersk, Walmart, and distribution group Wesco.
Siemens accelerated efforts to reduce its dependence on Chinese suppliers. Since 2019, Siemens employed Scoutbee, a chatbot that responds to requests to locate alternative suppliers or vulnerabilities in a user’s supply chain. Unilever and the maker of Marmite and Magnums were also able to identify new suppliers when China went into lockdown during the pandemic.
AI Frenzy also scoured customs declarations, shipping documents, and other data to build a map connecting 500mn companies globally. Its AI-enabled platform traces products back to suppliers in Xinjiang, or tracks if their own products are being used in Russian weapons systems.
Up to 96% of supply chain professionals plan to use AI technology, according to a survey this month of 55 executives by logistics group Freightos. However, only 14% were already using it. A third believed that using AI would lead to significant job cuts in their business.