Breaking Down Barriers to Implement AI

Artificial Intelligence (AI) has made enormous progress in recent years and its potential applications now extend to numerous areas, including logistics. Although there are a number of reasons that AI is not yet being fully utilized, there are fewer obstacles to overcome when implementing digitalization and AI solutions than you might think.

According to Josef Kamphues, there are a few main reasons why small and medium-sized enterprises (SMEs) do not value AI as much as this technology – with all its advantages – really deserves. Companies have concerns about data security and the complexity of the technology, and they lack AI expertise within their organization and are concerned about supposedly high costs. “These challenges must be addressed if we are to exploit the full potential of AI in industry,” says the head of the Supply Chain Development & Strategy department at Fraunhofer IML.

Talking through the issues

One major obstacle is the shortage of skilled workers, i.e., a lack of specialist knowledge. Many companies cannot find qualified employees, or their existing staff are unable to acquire the necessary knowledge. As a result, the companies’ AI projects frequently fail or never even get off the ground. Another obstacle is the lack of high quality data to use for training. Many AI applications require operational data that is often not available in sufficient quantities. The increased cost of financing AI technologies and a lack of financial resources are also significant obstacles. Other issues holding companies back include a lack of awareness on the part of the management, a lack of legal security, a lack of use cases that would add value, and regulatory obstacles. “As a matter of fact, when we enter into discussions with interested companies, we discover that we can quickly overcome the vast majority of these objections. This technology is still quite new, so there are many myths surrounding it – and they need to be corrected,” says Helena Piastowski, head of the Production Logistics department at Fraunhofer IML. “Of course, AI is not an end in itself – it always needs a use case.” “That’s why we help companies – through the SME Digital Centre Ruhr-OWL, for example – to discover potential fields of application,” adds Josef Kamphues.

“Machine learning algorithms can detect patterns and anomalies that human eyes often miss”

- Dipl.-Wirt.-Math. Martin Friedrich

An impressive example of an AI-driven solution

Martin Friedrich, an AI trainer at the SME Digital Centre Ruhr-OWL, describes one positive example: the implementation of AI-driven solutions in the field of container management at Mühlhoff Umformtechnik GmbH. By using advanced technologies to optimize their logistics processes, not only did the automotive supplier company from Uedem am Niederrhein increase efficiency, they also improved transparency and traceability throughout the entire production process. Container management at Mühlhoff encompasses a wide range of processes – from storage and transportation to tracking and managing containers. In the past, this has typically been a labor-intensive and error-prone field. “With the introduction of artificial intelligence (AI), this has fundamentally changed. AI-driven systems analyze large quantities of data in real time and provide accurate predictions regarding the demand for and availability of containers. Machine learning algorithms can detect patterns and anomalies that human eyes often miss,” says Martin Friedrich. This enables proactive planning and reduces bottlenecks and overstocking. The mplementation of AI technology at Mühlhoff has already yielded some remarkable results. The efficiency of its container logistics has increased significantly, resulting in cost savings and greater customer satisfaction. In addition, by optimizing transportation routes and reducing the number of empty runs, the company has minimized its environmental impact. “Overall, Mühlhoff Umformtechnik GmbH is an impressive example of how AI-driven solutions can revolutionize container management,” Friedrich adds. “By combining innovative technology and well-founded industry knowledge, the company is setting new standards in industrial logistics.”

“By combining innovative technology and well-founded industry knowledge, the company is setting new standards in industrial logistics”

- Dipl.-Wirt.-Math. Martin Friedrich

AI-optimized delivery time forecasts 

The haulage and logistics company ECS GmbH is also on the road to implementing a digitalized arrival time forecast system. As part of a transfer project with the SME Digital Centre Ruhr-OWL, the medium-sized company implemented an AI-driven ETA service for calculating transportation routes and forecasting the expected arrival and departure times. “We’ve been working closely with the company managers throughout the entire project,” says Martin Friedrich. The researchers recorded and analyzed the processes at the Kreuztal-based transportation company. The goal was to optimize delivery time forecasts using AI-driven software, simplify workflows and improve customer service. In order to achieve this, the SME Digital Centre Ruhr-OWL used the findings from an ETA service developed in Fraunhofer IML’s Silicon Economy initiative. “Here we are developing an open source infrastructure for the platform economy of the future,” explains Helena Piastowski. “The ETA service is a wonderful example of how basic AI-driven functions can be made easy to access and use in a financially viable way thanks to open source systems,” she adds.

Leveraging expertise in AI implementation

Josef Kamphues believes that two factors are essential for successfully applying AI: “First of all, when considering AI applications, we need to start with the use case and work backwards. That’s why it’s so important to begin by thoroughly analyzing the specific application options at each company. And secondly, companies should not be afraid to draw on the experience of other companies and leverage the expertise of research institutions and innovative start-ups. This kind of dialogue and collaboration is precisely what we need to avoid some stumbling blocks and thus achieve the desired results from the project in question more quickly.”

Josef Kamphues

Contact Press / Media

Dipl.-Ing. Josef Kamphues

Head of Supply Chain Development & Strategy

Fraunhofer Institute for Material Flow and Logistics IML
Joseph-von-Fraunhofer-Str. 2-4
44227 Dortmund, Germany

Phone +49 231 9743-146

Helena Piastowski

Contact Press / Media

Dipl.-Logist. Helena Piastowski

Head of department

Fraunhofer Institute for Material Flow and Logistics IML
Joseph-von-Fraunhofer-Str. 2-4
44227 Dortmund, Germany

Phone +49 231 9743-454