January 30, 2024 Unlocking End-to-End Automation in Trucking

In the face of rising costs and supply chain challenges, the trucking industry is turning to automation for cost-effective, agile operations.

The trucking industry is navigating a maze of challenges, including an extended period of low demand, which puts pressure on costs and impacts both operational effectiveness and profitability. In response to this, trucking and similar logistics companies are embracing automation and artificial intelligence (AI) technologies to automate tasks and maximize efficiency. As the sector continues to navigate headwinds this year, embracing end-to-end automation in the shipment transaction process will be crucial for maximizing efficiency and competitiveness. As new technologies emerge and get stronger, it will be paramount for the trucking industry to continue to automate select front office and back office operations activities and evaluate new innovations in real time to keep pace and stay competitive.

Front Office

Automation of customer acquisition activities is becoming more common in the trucking industry as companies see what technology can do to boost performance and efficiency. In front office operations such as pricing and proposal development, which often involve extensive manual processes, the implementation of AI enables trucking companies to redesign their service models, saving time and money. By utilizing technology, front office employees can focus on higher-complexity tasks such as customer acquisition, growth strategies and competitive defense, rather than mundane tasks.

On the customer service side, using AI chatbots and voice assistant applications enables customer conversations to be both thoughtful and streamlined. AI software, driven by NLP (natural language processing) and ML (machine learning) algorithms, is taught, and fed with the required information to answer diverse queries, error free. This is now commonly the first line of contact for customers looking for answers to questions.

As AI is adopted in the front office, customer care satisfaction rates are expected to increase dramatically as customers engage with knowledgeable “agents.” The revamped functions can also end up costing a fraction of what they used to and be scaled up much more agilely with a changing business, positioning the company for future automation initiatives. 

Operations

The potential of AI in the realm of operations is endless. The trucking industry is already benefiting from automated systems and AI technology that can optimize routes, reduces idle time and minimizes unnecessary detours, leading to more efficient use of labor and assets (tractors and trailers). Automated systems, powered by AI, reduce loading and unloading times, minimize manual work and optimize truck space, leading to decreased operational costs and improved delivery times. Advanced safety measures, through automation, eliminate accidents, mitigate risks and improve overall safety in the logistics environment.

New technologies and innovative business models are making automation more accessible and widely adopted within operations. The Robots-as-a-Service (RaaS) model is a prime example, gaining traction for its affordability and flexibility. This model allows businesses, especially small and medium-sized enterprises, to use robots on a pay-as-you-go basis without substantial capital expenditures.

Back Office

Companies are beginning to actively incorporate technologies to reduce costs of back office functions historically characterized by extensive paperwork, manual data entry and administrative procedures. AI, robotic process automation and process mining are transforming companies’ back office operations to optimize processes, improve efficiency and reduce costs.

For trucking companies, brokers, truck stops and logistics service providers, the shift toward automating back office operations is streamlining critical freight management functions, such as invoicing, invoice audits, and document processing. With the use of AI, the processing of invoices, bills of lading, rate sheets and other documents is more easily managed.

In the near future, back office functions could run lights out. They aren’t outsourced, offshored or nearshored — they are “no-shored.” By harnessing the capabilities of AI to streamline back office operations, companies are positioning themselves for the future of trucking. Those that have embraced these tools can maintain a competitive advantage over entities still adhering to conventional business methodologies.

Impacts and Opportunities

Automation is modernizing the trucking industry by using technology to eliminate service gaps and optimize productivity. The changes taking place today are just the beginning of a new, more responsive trucking and logistics industry. For those that have fallen behind the power curve, investing in AI and automation will be crucial for regaining momentum after the challenges of the past year. These innovations enable smaller companies to pass on technology investments made by more established companies that achieve the same end goal but require additional aid and expensive resources. Many AI-based initiatives do not demand the same depth of technological expertise, making them ideal for any company seeking to modernize its processes. AI and automation will level the playing field, as cost-effective and user-friendly technologies continue to emerge, offering an advantage for those that capitalize on it.

The views reflected in this article are the views of the author and do not necessarily reflect the views of Ernst & Young LLP or other members of the global EY organization.

Brian Lynch is the EY Americas Transportation Sector Leader and an executive director in the EY-Parthenon Transaction Strategy and Execution practice, Ernst & Young LLP. Brian leads strategy and transaction engagements for corporate and private equity clients with a focus on supply chain. Prior to joining the EY-Parthenon team, he spent several years in the transportation industry, including leadership roles with two global logistics companies.

Subscribe to Industry Today