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Bots May Be the Next Big Supply Chain Invasion

I ran into a bot for the very first time back in the year 2000. These computer programs ideally automate tasks normally handled by humans. For me, the bot streamlined a shopping task. At the time, it blew my mind.

I was heading out on a business trip to the Netherlands, and I wanted to capture the trip in pictures with a new camera. My job was to support the rollout of a warehouse management system (WMS) for a 3PL service provider in the small port city of Moerdijk. They also wanted to roll out improved distribution processes to help support the business of some large electronics OEMs.

I was all excited and I wanted to buy the best camera for the trip. I did my research and found out that the Canon EOS Rebel 2000 was market leader of the time. Next, I set about finding the best deal on my chosen model. Although e-commerce was still in early days, I had had a good experience buying a watch a few months earlier so I decided to go online again. As I started my research, I encountered the MySimon.com shop bot. It promised to crawl the Internet to find the best price for the product and collate a list all the vendors that carried the product.

mySimon's proprietary Virtual Learning Agent (VLA) technology took a unique approach to creating mass quantities of intelligent agents that mimicked human behavior and could be “trained” to extract specific information from any merchant Web site. The agents were created by mySimon Product Intelligence (SPIs), non-programmers that interact with the VLA system. mySimon didn’t even necessarily attempt to comprehend a single vendor’s site with a single agent; their arsenal back then was approximately 9,000 agents designed to glean pricing information from 2,200 merchants. Nonprogrammers used a proprietary language to script agents with an emphasis on simplicity, minimizing the cost of adding new vendors or dealing with a redesign. In addition to agents that crawled merchant sites multiple times per day, agents for particularly volatile or esoteric commodities like books and movies would be spawned in real time. Later that year, CNET bought mySimon for about $800 million.

Once mySimon had pointed me to the best bargain, I called the e-tailer, made sure the product was available at that price and ordered it. B&H Video delivered my camera in time for me to take it to Europe and I took the best pictures ever. I knew I was seeing the start of something that had the potential to transform businesses of all kinds.

Now, fast forward to 2016. Bots have taken a different role. Basically, they do several things, including some really sophisticated, complicated tasks. They are software programs that can disguise themselves as humans and have intelligent conversations with the people messaging them. The timing is very good for such bots for a variety of reasons:

  • The ubiquity of the mobile devices. Beyond cell phones and smart phones, much more advanced mini computers offer tremendous computing and processing capabilities.
  • The pervasive texting culture. Most humans know what texting is and would rather text than speak to someone on the phone. The simple user interface of texting lowers barrier to learning. With everyone texting, it's a simple thing to transition consumers from a toll-free number to a chat bot disguised as a human.
  • Texting minimizes differences. Using text people are able across culture, geography, time zones, and different accents. The basic requirement is to be able to have a decent conversation in English. Some systems even correct spelling mistakes automatically, making it even easier to get your point across.
  • Texting apps abound. Texting apps that have soared in popularity. Facebook not only bought Whatsapp for $19 billion, but also launched a Facebook Messenger. There are already more than 900 million people in the platform, and Facebook is working toward making it the chat bot equivalent for businesses of all sizes.
  • Chat bots are always available. Chat bots can provide a 24×7 support. The advent of omnichannel has made users have high expectations of being served when and how they want. This technology offers the always-on availability that is becoming expected.

Next time you are texting or chatting with a company rep, ask yourself if it's a real person or a bot that is offering you technical support, order status, and other help. It's entirely possible that you are talking with a highly sophisticated, artificial intelligence (AI) infused, cognitively intelligent, context aware software program disguised as a human.

I hope that the next wave for bots is in the supply chain. When you think about it, there are a number of promising possibilities.

At a high level, you may be able to replace all your phone call answering infrastructure into these chat bots. Of course, the transition has to follow an agile fashion. It would be important to do a small roll out, learn from it, improve it, add more intelligence to it, and, then spawn that into multiple chat bots. You would need some way to transition to a human if the chat bot is not able to accurately handle the situation. Chat bots lose their value if they undermine the customer experience with the organization.

Here are a few more places I could imagine chat bots in the supply chain:

  • Order status updates. This is specially compelling for e-commerce applications since 3PLs are playing a major role here.
  • Will calls status. Anybody can place an order, pay for it and pick up pretty quickly using this kind of capability.
  • Appointment scheduling for logistics. A truck driver that is ready to drop his load off can interact with the appointment scheduling system through a chat bot.
  • Order placement. Several texting apps in China already do this, but consumers in the West haven’t got on that trend yet.
  • Returns. Today, most people still have to make a phone call to return an unwanted item in order to get a return authorization number. Chat bots could streamline the process and enhance it. The consumer could even upload pictures through the chat bot to be catalogued against the Returns ASN. Further, the process of reverse logistics could be planned better.
  • Enhancing overall customer experience. Recently, I was picking up a rental car and ended up interacting with an operator through a phone handset and a monitor. After I completed the transaction, I picked up the documentation, went to the parking lot, picked up my car, and drove to my client site. It wasn’t as smooth as I would have liked and it required a heavy bandwidth. The first operator hung up without giving me complete information, so I had to go back to the kiosk again and redo the call. A chat bot would have made things much easier, getting the work done while I was still in the airport waiting for my luggage.

So what is the value proposition?

Reducing the human interaction in various supply chain tasks saves money and increases efficiency. Employees can be tasked with more intensive roles within the organization. Smoother experience for the consumers would be another net gain.

So do you want to build a chat bot for your enterprise or supply chain? Let us know your thoughts in the comments section below.

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