How a 16-year-old company is easing small businesses into AI

In the midst of ongoing discussions about the viability of artificial intelligence, the logistics and supply chain sectors are emerging as key areas for authentic applications of this innovative technology. Companies like Flexport, Uber Freight, and various startups are making significant strides, attracting high-profile clients. However, AI's advantages are not limited to large corporations; smaller businesses are starting to benefit as well. One such company, Netstock, established in 2009, has introduced a groundbreaking tool called the "Opportunity Engine". This generative AI tool integrates seamlessly with its existing customer dashboard, drawing data from clients’ Enterprise Resource Planning systems to provide real-time recommendations. Netstock reports that this tool has already generated a million recommendations, with 75% of users receiving suggestions valued at over $50,000. Despite the promising results, some smaller firms, like Bargreen Ellingson—a family-owned restaurant supply business with a 65-year history—initially hesitated to embrace AI. Jacob Moody, the chief innovation officer, expressed concerns about implementing a system perceived as a "black box". Instead of imposing it as a mandatory tool, he framed it as an optional resource for warehouse managers, allowing staff to gradually acclimate to the technology. Moody has observed that the AI tool helps minimize errors by processing extensive reports that inform inventory decisions. Although he acknowledges that the AI-generated summaries are not infallible, they effectively distill complex data into actionable insights, particularly during off-peak hours. One notable outcome is the empowerment of less experienced staff. For instance, an employee at Bargreen’s warehouse, who has no college degree but knows the operations well, can utilize the AI insights to enhance his decision-making. This approach not only boosts confidence among the workforce but also streamlines inventory management significantly. Netstock cofounder Kukkuk recognizes the skepticism surrounding new technologies, particularly when many AI solutions are perceived as subpar. He attributes the success of the Opportunity Engine to the company’s extensive data, accumulated over years of collaboration with retailers and distributors, which informs the AI's recommendations. Importantly, each recommendation can be rated by users, which helps refine the AI's algorithms. Kukkuk differentiates Netstock’s approach from social media platforms, emphasizing a focus on customer outcomes rather than engagement metrics. However, both Kukkuk and Moody express caution regarding the limitations of current generative AI technologies. They prefer to keep the AI supportive rather than autonomous, ensuring human oversight remains essential in decision-making processes. As they navigate this evolving landscape, they remain aware of the potential changes AI might bring to job roles and expertise within their organizations. In a time when many enterprises struggle to implement generative AI effectively, Netstock's initial success offers a glimmer of hope. Nevertheless, as the technology advances, the implications for workforce dynamics and operational strategies will require careful consideration.