The integration of artificial intelligence and automation has become a foundational investment for businesses operating in the increasingly volatile world of supply chain and logistics.

AI and automation aren’t new technologies. For years, operators have been exploring their capabilities, for everything from simple rules-based algorithms to sophisticated decision-making and robotics. Today, AI holds the potential to revolutionize the entire supply chain by optimizing inventory management, anticipating changes in demand, and fostering collaboration through real-time data accessibility.

Despite concerns about automation threatening jobs, it can create new opportunities and redefine the definition of what we consider to be a typical human task. In many cases, the technology allows operators to work smarter. Baby Boomers are reaching retirement age, and younger, more technologically literate generations are entering the workforce, making now the time to embrace the capabilities of AI and automation. 

The logistics industry is experiencing a change in the labor force. Gen Z and Millennials are steering away from taking jobs in traditional manufacturing and supply chain operations. One study conducted to gauge Gen Z’s interest in that kind of work found that only 14% of Gen Zs would consider a job in this sector. At the moment, 76% of supply chain organizations are undergoing a labor shortage because of the lack of new talent. Younger generations may have preconceived notions about what industrial work means, based on historical working conditions. Compared to industries such as tech or entertainment, supply chain and logistics fall short in offering workers flexibility and career mobility opportunities.

Younger generations entering the workforce today are familiar with the digital technology that’s designed to enhance their productivity. A recent survey of supply chain professionals found that 35% of workers’ time is spent manually handling data. Younger workers expect tools and processes to be tailored to their needs, which means employers must adapt the work environment and drive efficiency through technology adoption.

Startups in the logistics sector are deploying machine learning and “human-centered” AI to optimize the workload in warehouses, ultimately freeing up workers to focus on higher-value tasks. Gen Z and millennials’ familiarity with emerging technologies enables them to adapt quickly to these automation solutions, driving organizational transformation and fostering a culture of continuous improvement and innovation.

As the dynamics of the retail landscape continue to evolve, the adoption of AI and automation in supply chain logistics emerges as a pivotal strategy for businesses to remain competitive and sustainable. A tech-savvy workforce brings fresh perspectives and enhanced technological ability to supply chain organizations. By embracing newer technology, companies can achieve new levels of efficiency, sustainability and profitability, while simultaneously harnessing the innovative potential of younger generations to drive transformative change in the industry.

Zhenni Liu is a partner with MaC Venture Capital.