How AI and IoT Can Change Transportation Management

Internet of Things Supply Chain

We’re currently living through the greatest boom of technology and progression known to man. With these


new technologies come advancements in every area of business, from customer-facing technologies to predictive inventory to transportation management.

“Smart tech” is revolutionizing the way companies do business—including an impact on your company, whether you realize it or not. In fact, the United States Department of Transportation plans to award 40 million dollars to a single city that best demonstrates how technology can be used to reinvent the movement of people and goods.

Businesses are quickly implementing AI and IoT to streamline operations and optimize data. This technology has already taken hold in major cities, and it’s quickly making its way into transportation management as well.

What will AI and IoT do to transportation management? And what does this mean for your business and clients?


What is AI and the IoT?

Artificial intelligence (AI) is when machines display learning patterns, so they’re able to grow their knowledge through learning. These machines can recognize patterns and collect data to analyze, predict, and track future changes. AI helps automate learning to make smarter, safer, faster decisions in business.

According to Stanford’s Artificial Intelligence and Life In 2030—One Hundred Year Study, AI is going to have a huge impact on all forms of infrastructure. From city public transportation to rural sewage systems to transportation management, AI is able to collect and process data at a rate faster than humans can. This has major impacts on the way businesses understand data and create strategies.

IoT refers to the Internet of Things. This is basically the network of all devices that are connected (usually through WiFi, software, and sensors) in order to exchange data.

Connected devices include (but are not limited to) vehicles, home appliances, electronics, shipping boxes, robots, and even credit cards. The limits for connectivity are endless. In fact, there are currently 15 billion connected devices, and it’s predicted that this will rise to 50 billion in the next two years.

IoT is the wave of the future with regards to transportation management. Analysts predict that 75% of new cars will feature IoT connectivity by 2020. And this is only with commercial use; in the shipping and logistics sector, connectivity could reach as high as 90%.

This is because AI and IoT are able to optimize processes in ways that companies could never before have imagined. In fact, IDC and Sap estimate that even basic usage of AI and IoT can create an instant 15% boost in productivity of delivery and supply chain performance.


Autonomous trucks

Autonomous and semi-autonomous trucks have already driven onto the transport scene. Artificial intelligence enables trucks to sense their location and other objects around them in order to drive with appropriate speeds and directions. From Uber’s self-driving car to Tesla’s Semi, autonomous vehicles are quickly becoming the wave of the future.

Currently, self-driving cars aren’t fully autonomous. Rather, they function like “auto-pilot,” allowing drivers to sit in the passenger seat to do paperwork or sleep while the truck is driving itself. This lack of full-autonomy is largely to do with social and government pushback, which you can read about here.

However, IoT is making it easier for self-driving trucks to be fully autonomous through interconnectivity with warehouses, route planners, and delivery checkpoints. This will make these trucks safer and more efficient than even trained drivers themselves.

Moreover, connected robots and drones are quickly entering the scene as new methods of autonomous delivery. This will especially have an impact on last-mile logistics and e-commerce.


Tracking and reporting

IoT creates real-time insights that can be tracked and reported. This fashions a log of shipments and routes that can manage transportation on both a micro and macro level. With remote monitoring capabilities, companies can quickly see if there are maintenance issues or delays with the truck.

Basically, IoT removes the need for lengthy paperwork—which can often be incorrect or fudged—to get more accurate and updated analysis.


Strong analytics

This tracking and reporting software doesn’t just allow companies to have a history of their trucks and shipments. Artificial intelligence can then analyze this data to create predictive forecasts.

This constant analysis of data can help identify inefficiencies in planning, inventory, stocking, loading, unloading, and even among the workforce. It can then help create a strategy to create more efficient processes.


Optimized traffic

Pattern recognition and incident detection are important aspects of artificial intelligence. AI actually studies traffic patterns to optimize and plan routes based on peak traffic hours, maintenance, and construction.

Because of its learning capabilities, AI machines are able to consistently learn new patterns to keep routes updated and optimized. IoT can then track and collect this information to better create a long-term analysis of transportation planning.


Warehouse management

Artificial intelligence and IoT-connected devices have already made their way into a number of warehouses, including Amazon’s e-commerce warehouses. For example, robot workers are able to pick faster and follow high levels of quality control.

RFID tags are also changing the inventory game. RFID tags are connected to the cloud and share data on the location of a given package or pallet. This means staff doesn’t need to scan every item for inventory or delivery. They can simply load and unload the containers, and the RFID automatically updates the inventory in real-time.

This saves significant time and money while improving the accuracy of stock-keeping. In fact, RFID tags can maintain 95% accurate inventory, while the average inventory rate floats around 65%. Because of these numbers, nearly 96% of major retailers are planning on adopting RFID tech tags.



IoT can help run internal diagnostics on trucks to alert to maintenance issues much earlier than the truck itself can even know. This allows for a safer drive while also increasing the lifetime value of the vehicle.

Moreover, self-driving trucks can react to incidents much faster than a human can, and they’re even able to predict (and avoid) potential accidents before they occur.

IoT is also improving warehouse safety and security by allowing automatic door locking and theft detection. AI can detect unusual movements of both external and internal thieves to alert managers to the potential of asset loss. It can then use that data to identify and improve areas of concern.


Streamlined processes

AI studies multiple factors at once, while IoT connects everything at once. This creates a holistic analysis of all areas of transportation management.

Together, AI and IoT can take a look at the warehouse floor temperature, inventory, safety, and performance of equipment.

They can link warehousing with loading procedures, where sensors can determine the utilization rate of trucks.

This can then be linked to transport, where semi-autonomous trucks provide ongoing updates about location and safety.

Then, AI can determine the speed of unloading and last-mile delivery.

This links together to optimize routing and planning. AI and IoT are able to analyze multiple facets of data to make processes more efficient from A to Z.


Decreased costs

All of these benefits together can help minimize costs. AI and IoT reduce inefficiencies that throw money out the window. They can also help reduce:

• Gas costs by avoiding traffic or stalling.
• Insurance costs by making trucking safer.
• Salaries, since drivers can do work and sleep while on the road.
• Replacement costs, because IoT can quickly alert to maintenance issues.

Reduced costs mean a stronger bottom line for retailers and transport companies alike.


Enhanced customer service

AI and IoT make delivery faster and easier than ever. Customers expect immediate delivery—and warehousing and shipping technology is the only way to manage that demand. IoT also increases the transparency of the transportation process, which consumers value and appreciate.

In particular, IoT’s tracking and reporting capabilities may enable the use of estimated arrival times down to the minute—not the day or even the hour. This will optimize route planning and boost customer service, especially with regards to the last mile and reverse last mile.

Moreover, AI and IoT improve the quality of life of drivers. They don’t have to deal with the headaches of labor-intensive paperwork, and they can spend fewer hours on the road getting to their destinations. This improvement in the trucker lifestyle has a direct impact on client satisfaction and on business profitability.



Artificial intelligence and the Internet of Things are quickly taking over transportation management. These technologies are optimizing shipment and making processes more efficient, productive, and profitable. We expect that trucking capacity concerns will be a thing of the past when AI and IoT data analysis and prediction come into play.

Do you want to be transported into the future on a wave of technology?

Reach out to Redwood today to learn more about how your business can benefit from artificial intelligence and IoT integrations in 2018!