While we don’t think about it, self-driving trucks and cars use artificial intelligence (AI) to make decisions.  But AI can be easily fooled.  For example, these vehicles stop when a stop sign is placed at the side of a highway.  Imagine the havoc of this happening on I-95 in rush hour.  Clearly, AI doesn’t yet understand the context of how a stop sign should be used – i.e., they don’t understand common sense.   (Source: Prof. Bruce Porter)  But this is changing – albeit the change is slow because, for example, nowhere is it written that a stop sign shouldn’t be on I-95 unless there is a toll booth.

However, AI has a role in the supply chain:  from predicting demand more effectively to developing the “optimal” deployment and all the way to case picking in the warehouse.  For example, truck sensors can be used via the Internet of Things (IoT) combined with predictive analytics to determine that a part operating in a dusty environment needs to be replaced.  The demand for the part can be pushed to the supplier.  So now, wear data can be used to drive demand – what a difference from “average demand over time.”

 

Hunter Harrison, CSX’s “savior,” has died.  The man who was bringing “precision railroading” to CSX had vastly improved two Canadian operations – but had struggled to get anything but chaos from CSX.  His successor is a loyal minion – but lacks a strong operations background.  Maybe this is why CSX’s stock fell 7%.