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Yossi Sheffi on AI and the future of supply chains


Global supply chains are an extraordinary feat of technological and organizational sophistication. They are also, as the Covid-19 pandemic has shown, vulnerable to unexpected developments. Will that change as artificial intelligence becomes a bigger part of the supply chain? And what will happen to the workers in the process?

Global supply chains are an extraordinary feat of technological and organizational sophistication. They are also, as the Covid-19 pandemic has shown, vulnerable to unexpected developments. Will that change as artificial intelligence becomes a bigger part of the supply chain? And what will happen to the workers in the process?

MIT Professor Yossi Sheffi explores this topic in a new book, “The Magic Conveyor Belt: AI, Supply Chains, and the Future of Work,” published by MIT’s CTL Media. Sheffi, Elisha Gray II Professor of Systems Engineering at MIT, also director of MIT’s Center for Transportation and Logistics, which recently celebrated its 50th anniversary. he spoke with MIT News about the new book.

Q: Why did you write this book?

A: After the pandemic started, suddenly the supply chain ran hot. For the 50th anniversary of the Center for Transport and Logistics in March, we thought of writing the paper that became this book. In the first part of this book, I just explained how complex supply chains are, and how amazing they are. You shouldn’t be disappointed when something isn’t available in the supermarket or on Amazon; You will be amazed that something is there, once you understand what it takes to get it. Supply chains not only underline people’s living standards by ensuring the availability of medicines and daily necessities, but are also critical to addressing modern challenges such as resilience and sustainability. The book then looks at the technologies underlying supply chain and business operations in general, particularly AI, leading to an exploration of future work. This technology moves so quickly that it’s hard to know what will happen, of course.

Q: You can’t predict what impact AI will have, but how do you think about it, and discuss it in books?

A: I saw all the industrial revolutions; the fear of losing a job has always been prevalent. In 1589, William Lee applied to the Queen of England for a patent for a sock-making device. The queen shut it down, fearing she would lose jobs in the industry. When looms were automated in the 19th century, or when Ford started the Model T production line, this fear led to violence.

But with every change in technology, more jobs are created than lost. Every time, people say, “But now it’s different.” Even with AI, there is a chance that more jobs will be created than lost. When ATMs appeared, people thought there would be no more bank tellers. But the number of bank tellers in the US has doubled. Why? Because opening a branch becomes much cheaper. When Ford built cars by hand, they only had a few hundred employees. With the Model T, there were 157,000, but this is not the big story. When people could afford cars, people started driving everywhere, and motels and restaurants popped up all over the US, millions of jobs were created. So you have growth in the profession itself and related fields.

There is little doubt that modern AI can increase productivity and usher in a new era of economic growth if used for good. But I do want to say one thing about why this time might be a bit different: the pace of change. Because unlike electricity or steam engines, you don’t need to build big factories. It is software that, once developed, travels at the speed of light. The government may have to prepare more for retraining and put people in trade schools more quickly. As AI becomes more sophisticated, it will develop wider possibilities.

Q: Taking that insight, how can we see this being applied to supply chains?

A: Supply chains automate quickly. Warehouse full of robots. It is the number one robotics app in China and many other places. Jobs that used to be driving trucks and moving boxes, and professions that were predominantly male, are now increasingly technical jobs, and we are seeing more and more women working.

But in 2015, truck driving was still the number one profession in 29 US states. Autonomous trucks will not enter cities. To get there they had to cross a white line on the street, over a sidewalk, and so on, which they weren’t programmed to do. Instead, the autonomous truck model is now called exit-to-exit, where there will be transfer stations near the highway and outside the city. A truck goes from the factory to a highway exit, then to a transfer facility to unload its goods. This will likely create a lot of new jobs in the first and last miles of autonomous truck travel, and lots of jobs at these stations, including retail service, maintenance, and audit/inspection. It may be hard to imagine, but I can see more jobs being created. I’m an optimist, but that’s my nature.

The reason I love working in this field is because of a combination of things — technology and process — but at the end of the day, a supply chain is a network of people. Ultimately, the supply chain is made up of the people who create, store, move, contract, communicate — all augmented by increasingly sophisticated technology. And technology is a force that adds to many unique human qualities, not a substitute force.

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Written by Peter Dizikes, MIT News Agency

Additional background

Book: “The Magic Conveyor Belt: AI, Supply Chains, and the Future of Work”

https://sheffi.mit.edu/magicbelt




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