Once upon a time, businesses could expect extended periods of relative stability. One of the biggest changes to the business world over the last twenty years is the move from stability to unpredictability. In particular, supply chains are being negatively impacted by external events far more frequently than ever before. Disruptive events include the recent pandemic, political events, labour shortages, and climate change that results in forest fires, hurricanes and other extreme weather. These events are causing supply chains to face higher levels of risk and more potential disruption to business activity.

According to Gartner, 97% of supply chains have experienced a disruptive event in the last two years.  52% of these supply chains have experienced disruptions as high-impact events. In their 2020 survey, Gartner found that only 17% of supply chains were fit and that many were left behind after experiencing a disruption. As a result, manufacturing and other activities are dealing with bottlenecks and shortages of critical commodities and products. Shippers of all sizes need to re-evaluate supply chain strategies to try and balance transaction costs, supply chain fluidity, velocity, flexibility and resilience.

A focus on the supply chain as a whole, not just its parts, has become crucial. Ports are a part of the complex supply chain ecosystem and they, along with stakeholders and customers, play an integral role in the global economy.  As ports are a pivotal link in the supply chain, helping to move goods across modes of transportation, it takes great foresight to keep ports agile and running.

Many forward-thinking organizations are looking at applying artificial intelligence to develop models that can increase the resilience of the entire supply chain. The more resilience in a supply chain, the more fit it is. Gartner describes a fit supply chain as one that is able to move ahead after dealing with the most high-impact disruptive events. The 2020 Gartner Supply Chain Disruption Management and Impact Survey found that only 17% of supply chains were fit.

AI can help ports and their stakeholders improve planning by providing intelligence and “what-if” scenarios. What would happen if a major mode of transportation, such as rail, was to suddenly shut down? With so many moving parts in the whole logistics operation, it can be overwhelming to try and plan for every unexpected and uncontrolled problem. Panic situations can lead to poor decision-making or decisions based on faulty information.

The use of AI can provide ports and their stakeholders with analytics tools to examine the impact of disruptive events, which can then lead to the creation of a predictive model and a recovery model. The predictive model would act as a warning while the recovery model would recommend actions that quicken a return to full-scale operations.

These two models offer ports several benefits. The predictive model allows ports to understand the probability of disruptions. They can then investigate alternate sourcing options in advance and establish business agreements. The recovery model allows ports to explore a range of contingency plans and recommends potential actions that lead to a return to full-scale operations.

By collaborating with its stakeholders, ports will be able to respond more efficiently to an event and to recover more quickly. This greater agility leads to improved performance for the port and the stakeholders after a disruption.

To provide ports all these benefits, an AI solution must analyze all available data, including internal and external historical and geographical data, along with data regarding supplier performance and other metrics, then develop a plan to optimize the resources available, present recommendations for future investments along with mitigation strategies to help the continuation of logistics operations.

Nuvoola is an example of a company that helps ports improve resiliency. Its LUKE AI for Supply Chain and Logistics (SCL) is a SaaS solution comprised of three distinct sets of advanced analytics related to visibility, fluidity and resilience. The visibility module integrates multiple sources of data and processes them to provide a complete view of information, such as daily throughput, railcar volume, cargo volume, and more. Real-time performance is then monitored with a fluidity dashboard that provides detailed insights on things like gateway cycle time, outbound time, average time spend by location or commodity and more. Finally, the resilience module uses predictive analytics to alert ports about potential disruptions and their impacts on business. This is done thanks to a wide variety of data including A6 and A6A forms from CBSA, and data from Transport Canada and Environment Canada. These analyses increase the ability to react to disruptive events and to recover from them without significant impact on operations and customer timelines.

It is expected that supply chain disruptions will become more frequent and less predictable. To avoid increased pressure on business and damage to reputations, ports must find innovative ways to become resilient. Click here to more about Nuvoola and how it can help improve your port’s resiliency.