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Machine Learning and Exception Management in Logistics Technology

Machine Learning and Exception Management in Logistics Technology

Alan Jackson
by Alan Jackson — 3 weeks ago in Supply Chain Management 3 min. read

There has been a lot of talk about machine learning in logistics management. The idea is simple: optimize, infer, implement and repeat.

Machine learning and exception management — a logistics tech game-changer

What is included in the different pillars of logistics management?

A system maximizes the various pillars of logistics management which have order preparation; seller performance management; fleet capacity optimisation (direction); dispatch direction; in-transit dispatch monitoring; and delivery direction.

Then, the system infers the things or bottlenecks inside these columns (logistical processes) that could be fixed, enhanced, or improved. All these inferences or analytics are subsequently’executed’ back to the logistics setup.

The learning mechanisms return from optimisation. Over-time the machine evolves and enhances all of the connected logistics management procedures. This can be machine learning from logistics management.

What is exception management in logistics?

A logistics exclusion (problem) is a deviation from intended or anticipated procedure implementation. Listed below are a couple examples.

  • Shipment heaps are not mapped correctly to accessible fleet alternatives (creating capacity-mismatches and loading/dispatch flaws).
  • In-transit shipments are arrested at a place for two or more hours (or are dividing service level agreements with speeding or unpleasant braking).
  • Consignees did not receive all of the SKUs (stock-keeping components) according to the first purchase order.

Every transport management system (TMS) entails some or several human touchpoints. A individual supervises these procedure or procedure interactions (touchpoints).

This may be anything from assessing the dispatch mission schedule and making sure that the handlers are after the loading routines. In the same way, a number of different touchpoints operate to make sure that the gap between programs and’actuals’ is minimal.

The objective of exception management would be to minimize this gap between intended and on-ground outcomes.

All in all, the machine-learning facet of exception management induces efficiency and accountability within the organization’s and logistics system’s culture.

This could be together with the managers, warehouses, freight forwarders, logistics service providers, consignees (distribution factors), etc..
Also read: Artificial Intelligence helps Supply Chain Analytics make better Predictions

6-stages of machine-learning enabled exception management system.

The 6 stages are Discovery, Analysis, Assignment, Resolution, Records, and Escalation.

Exception management and machine learning 719x719 1 - Machine Learning and Exception Management in Logistics Technology


It finds and reports problems or anomalies over the procedures. This may be through temperature detectors (cold-chain logistics), real time motion monitoring, order traveling monitoring (in-scan and out-scan of every SKU), etc..


It analyses and procedures the matter or exception according to protocols (or even learnings). It categorizes and pushes forward all exceptions — to a mission or to an escalation.


It matches the exception with the ideal person or section (best-suited to solve the exclusion punctually).


It monitors the rate and potency of the individual’s (assignee) resolution. It transfers the’resolution’ through numerous standards and validations before satisfactory’conclusion’.


It investigations and records each exception directly from discovery to settlement. The machine processes those documents to throw-up insights or best-practices for prospective programs.


This is a significant facet of dynamic exception administration. The machine continuously monitors each issue inside the computer system.

  • If in the evaluation or settlement phase, the manager (or system) deems the problem — complicated or critical, then it is escalated through particular’analysis’ and resolution. It mostly includes individuals with various skill-sets or jurisdiction.
  • When the system finds an issue has not been solved in its own time-frame, it is again escalated.

During these 6-stages, the machine always weeds-out inefficiencies from inside itself. It will help disperse a transparent, capable, nimble, and responsive civilization. Not only that, but helps reduce mistakes and flaws, which, consequently, enhances profit margins.

A couple new-age TMS start-ups, such as Fretron, are attempting to capture market share utilizing this 6-stage exclusion administration.

Real-world applications of escalation management in logistics

Let us think about a real-life use-case for an exclusion management system (EMS) — a fast-growing merchant in India focusing on Tier-2 and Tier-3 cities.

  • Their main challenge has been an unorganized logistics (vendor/freight forwarder) system and feeble city infrastructure.
  • Despite the fact that the merchant had opted-in for complete logistics automation, they weren’t able to apply it to the complete extent. The customer was seeking a tech-enabled procedure and culture change.
  • The EMS allowed quickly and error-free invoicing which incentivized the carriers and freight forwarders to operate in a coordinated manner. Throughout an pragmatic learning procedure, the machine enhanced upon itself. It attracted a greater level of transparency and responsibility within the logistics positions (from the business).
  • On the rear of machine learning-enabled EMS, the company managed to provide high-definition worth (better shelf options) because of its end customers.
Also read: Top Supply Chain Technology Trends for 2019

Conclusion: Exception management, in logistics, is a game-changer

EMS successfully bridges the gap between tech-induced efficiency and on-ground employee efficiencies. It’s especially effective in unorganized or traditional markets that are riddled with such ‘exceptions.’

If machine-learning backed EMS is used in the right manner, many mid-level companies can scale fast and improve their outlook within the next five years. At this time of COVID-19, scaling faster may be the only option to save your company.

Alan Jackson

Alan is content editor manager of The Next Tech. He loves to share his technology knowledge with write blog and article. Besides this, He is fond of reading books, writing short stories, EDM music and football lover.

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