Managing physical operations in industries like trucking and logistics is increasingly challenging due to rising costs, labor shortages, safety concerns, fraud, and outdated technology, but artificial intelligence (AI) may hold the solution, according to a study from vehicle technology provider Motive.
The top five challenges that threatened physical operations in 2023 include rising costs (59%), economic instability (51%), labor shortages and talent retention (45%), supply chain disruptions (42%), and operational inefficiencies (36%), the company said. The results came from “The Motive Physical Economy Outlook 2024,” a survey of 1,000 leaders across the physical economy such as trucking and logistics, construction, oil and gas, manufacturing, and retail.
Looking into the future, half of leaders think that 12 months from now the economy will be better than it is today, while 18% expect it to be about the same, and 32% expect it to be worse.
Despite that relative optimism, leaders lack a single, 360-degree view of their operations due to data silos and lack of integration, Motive’s survey found. Specifically, nearly half (46%) of leaders are using more than ten individual tools to manage their operations, with 30% saying it’s too many to count. And as a result, 58% say they spend most of their time dealing with reactive issues versus proactively managing their workers, fleet, spend, or assets and equipment. 44% of leaders admit to losing track of vehicles at least monthly.
Technology holds the most promise as a solution to those challenges, the study showed. The top five areas where leaders see AI bringing the most value include tracking assets and vehicles (43%), more accurate decision-making (40%), expense planning (39%), reducing administrative work (39%), and detecting fraud (38%).
In addition, 69% of physical operations leaders think AI will have a positive impact on their jobs and nearly a third expect AI to address labor shortages. And 73% of leaders agree that roads are safer with AI-enabled cameras and 64% say AI is crucial for preventing accidents and coaching drivers.
"Over the past year, leaders in the physical economy grappled with rising uncertainties, escalating costs, increasing fraud, and a scarcity of skilled labor," Shoaib Makani, co-founder and CEO of Motive, said in a release. "The need for transformation is evident, with limited visibility and data silos hampering profitability and heightening safety risks. Leaders recognize technology, particularly AI, as a game-changer for automating proactive decisions, improving visibility, and enhancing safety, effectively addressing industry challenges and presenting opportunities across this critical sector of our economy."
