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AI, Human Ingenuity, and the Next Era of Supply Chains
Episode 1480 • 15th September 2025 • Supply Chain Now • Supply Chain Now
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In this episode of Supply Chain Now, Scott Luton and Tevon Taylor welcome Gaurav Malhotra, Partner and Supply Chain Technology Leader at EY, to explore how artificial intelligence is transforming supply chains today and where it’s headed over the next five years. Gaurav shares how EY is helping organizations embrace emerging technologies to create competitive advantage, avoid “pilot purgatory,” and build more cognitive and resilient supply chains.

They cover practical misconceptions holding companies back from adopting AI, the foundational elements required for successful implementation, and real-world examples of immediate impact in logistics, predictive maintenance, and warehouse operations. Gaurav also discusses how organizations can invest in workforce education, reskilling, and culture change to ensure that humans remain at the center of AI adoption. Looking ahead, he offers his perspective on how agentic AI will reshape supply chains into adaptive, orchestrated ecosystems while freeing people to focus on creativity, critical thinking, and enterprise differentiation.

Jump into the conversation:

(00:00) Intro

(04:13) A personal story family pilgrimage to Kauai

(07:34) The intersection of supply chain and humanitarian efforts

(09:52) Ey’s role in global supply chain

(15:20) Misconceptions about AI in factories

(18:09) Overcoming pilot paralysis

(22:29) Immediate benefits of AI in supply chain

(26:25) AI’s impact on supply chain efficiency

(27:18) The role of agentic AI in factories

(31:43) Human element in AI-driven supply chains

(36:17) Upskilling and reskilling for the AI era

(43:05) Future predictions for AI in supply chains

Resources:

This episode was hosted by Scott Luton and Tevon Taylor and produced by Trisha Cordes, Joshua MIranda, and Amanda Luton. For additional information, please visit our dedicated show page at: https://supplychainnow.com/ai-human-ingenuity-next-era-supply-chains-1480

Transcripts

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[00:00:21] Voice Over: Welcome to Supply Chain Now the number one voice of supply chain. Join us as we share critical news, key insights, and real supply chain leadership from across the globe. One conversation at a time.

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[00:00:44] Tevon Taylor: I’m doing great. How about you?

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[00:00:55] Tevon Taylor: You’re lucky. Dallas is 105 today, so we’re hot.

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[00:01:54] Tevon Taylor: Are? No doubt

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[00:02:19] Tevon Taylor: Let’s do it.

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[00:03:07] Gaurav Malhotra: I’m good, Scott. How are you?

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[00:03:23] Gaurav Malhotra: It’s just a very, very beautiful time of the year, honestly, both weather-wise, everything that goes around here in Chicago, the amount of events and social settings that the city has to offer. I mean you just can’t ask for anything better, right?

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[00:03:45] Tevon Taylor: No, I love the deep dish. That’s my favorite pizza up there. One piece will fill you up for the day, right?

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[00:03:52] Gaurav Malhotra: Work out extra cuisines wise, you all know, right? I mean Chicago, you name the cuisine and you name the type of restaurant you want and you find it right here essentially.

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[00:04:24] Gaurav Malhotra: Yeah, it’s interesting, Scott, that you asked about that, but me and my family have been following this monastery as disciples of the monastery for 20 plus years and the monastery is based in Kauai, up in the mountain in Kapa, and we feel very fortunate and blessed to be associated to it. So to your point, this is just a few weeks ago, we had our annual pilgrimage, that’s our annual tradition to be able to go there and we make this a bit of a pilgrimage and a little bit of a vacation where we break the day up and do all the things monastery related that we’re supposed to be doing, including service, et cetera. And then given kids we keep part of the day for other things related to social and enjoyment and stuff like that, we’ve just been very fortunate to have that format, to have that affiliation in all the teachings that’s come out of that to us as a family essentially. Given the supply chain topic that we’re talking about here, just a connection that you may find interesting.

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[00:05:34] Gaurav Malhotra: So the monastery actually has a temple there that is fully hand carved, built over decades. So one of a kind in the world honestly. And it has had its own set of supply chain uniqueness tied to it, given it was hand carved in India, brought over across the ocean by very skilled artisans who then were coming over decades to Kauai and finishing the unfinished stones and then assembling them because there’s only a few of them that are all over the world that can actually do things like that. And now it’s fully assembled a marvel of its kind that hopefully a lot of people get to go witness and enjoy and get the blessings from essentially.

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[00:06:53] Tevon Taylor: To your point, there’s a supply chain behind everything. I mean most people, including myself before I got into supply chain, you just think something appeared there or it happened there. You didn’t realize all the pieces that go in place and especially something on an island, you assume that’s where it was, everything was done, you didn’t think it was done somewhere else and brought over. And I love that because everything can go back to the simple pieces and parts that go into a supply chain to make something look complex, but it evolved from somewhere else, right?

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[00:08:27] Scott W. Luton: Wow. It is fascinating. Tevon took Gaurav’s incredible experience that he and his family had, the humanitarian logistics and those professionals that have really been able to really dial that in and level it up to do incredible things now and really the greater supply chain efforts that go around responding to these awful, awful disasters, it is nothing less than amazing, huh?

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[00:09:04] Scott W. Luton: That’s right, and I can’t go further. I got to give a plug to a great nonprofit partner of ours that the acronym is ALAN, that’s the American Logistics Aid Network and they do outstanding humanitarian work all around the globe. So give Kathy Fulton and the ALAN team a call. Alright, so Gaurav back to our topic at hand. I’ll tell you I’m looking forward to when your book’s coming out because you’ve got more than 25 years of industry and consulting experience, what you bring to the table and a lot of that of course as I mentioned earlier, supply chain, trade planning, compliance and tons and tons of technology. So I want to level set for just a minute. Tell us about your role at EY and we know EY does a lot of things in global supply chain, but give us a couple of highlights of what are some of your favorite things that the organization does to serve this industry and push it forward.

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[00:11:30] Scott W. Luton: Gaurav. Okay, we can make a whole episode around your last response and there’s a couple things I want to pull out Tevon and get you to and also hear what your thought there was competitive advantage. It’s amazing. Supply chain has always been able to create competitive advantage but now it’s expected to and now it has such a unique and powerful ability to deliver in very powerful ways. We can start and start with just delivery service levels and then secondly, no islands of excellence. Did you hear as he talked about getting the right outcomes in an integrated in a holistic fashion? As I like to ponder a lot, Tevon in this golden age of supply chain tech that Gaurav could probably share a whole bunch of perspective around we have a terrific opportunity to go bust down silos, but in some cases we’re creating more silos because of all the capabilities we have. But Tevon, what’d you hear there in what Gaurav does and of course the role EY plays in global supply chain.

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[00:13:13] Scott W. Luton: Well, you could have been very successful, Tevon, I’ve seen you work, but Gaurav, kidding aside, I’ll tell you as the fearless supply chain technology leader in this age of truly, it’s remarkable what we’re accomplishing moving just one element, moving so much from reactive to proactive mode, right? It’s some of my favorite big time trends. It’s an amazing time to be in supply chain tech right now. Gaurav, is that right?

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[00:14:47] Scott W. Luton: That’s right. Completely agree. Alright, so let’s bring the power. That’s another phrase that Gaurav used that we’re going to have a lot of fun with throughout because he’s bringing the power of technology to make things better in global supply chain in a very holistic manner. Let’s get into AI adoption in supply chain. We have a lot of conversations around this because I think the more examples, more use cases, the more really practical stories that we can bring to our audience, the better they can wrap their head around the immense opportunities and hopefully find more progress in their own organization with innovative technology. But let’s talk about misconceptions first, Gaurav. What’s one common misconception you often hear about, especially when it comes to AI in factories and compare and contrast that with the reality that you’ve seen yourself.

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[00:16:57] Scott W. Luton: Tevon, I love these three misconceptions that Gaurav put out there and my favorite one is probably the third one where your data doesn’t have to be perfect. Gosh, if you wait on, as I heard it put the other day, if you wait on your data to be perfect, you’re never going to get around to driving real incredible transformation. Tevon, what’d you hear there?

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[00:17:50] Scott W. Luton: I’m with you and this trend that’s been around for years, how the small can almost out mighty and outcompete the big because the grand equalizer that is technology. I find it all fascinating. Let’s talk about pilot paralysis, Gaurav. So a lot of organizations when I read this phrase I’m like, yep, I’ve been there a time or a hundred. From your experience, what are the critical foundational elements that companies got established before attempting to implement AI at scale?

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[00:19:04] Scott W. Luton: That even better. Gaurav, pilot purgatory.

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[00:19:07] Scott W. Luton: Hear that Tevon? I like that even better. I’m sorry, go right ahead.

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[00:20:10] Gaurav Malhotra: You have to have an enterprise wide strategy around those when it comes to AI in particular. And data is obviously a big component of that. We just talked about it. And once you have that and the right guiding principles to support those foundational principles that are aligned to your enterprise strategy, well understood by all the right stakeholders, then you move further into the journey which relates to the function in question, the use cases, the prioritization, the value, and the outcomes you’re going to receive through it. The final point is how do you have a continuous improvement loop to it? Because this is not a one and done, the technology continues to evolve. You have to have a governance and a mechanism that is looking at this on a continual basis.

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[00:21:13] Gaurav Malhotra: I mean obviously you’ll say I’m biased, right? But the team in India is a dominant team.

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[00:21:43] Tevon Taylor: Yeah, I don’t know if I want to talk about Aggie football just yet, I’ll jinx them. But AI is not an algorithm. It is about data, process, people, leadership and aligning those. So that’s your foundation. If you don’t have that foundation, the pilot will stay the pilot and you’re going to be in that purgatory. So you absolutely have to have those things lined up like you mentioned.

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[00:22:57] Gaurav Malhotra: There are many leading large organizations, some cases small as well, that have leveraged this again in a structured, methodical manner, getting huge bold benefits and they cut across the spectrum. So again, in the logistics and transportation space, companies like UPS and others — and this is public knowledge — are leveraging this technology embedded into their current processes and technology and leading to huge, huge benefits from the standpoint of route optimization and fuel savings that they’re able to get. And that’s being replicated through the LSP patch particularly because obviously logistics service provider, this big thing from the standpoint of route optimization and fuel cost. And by the way, that then translates into driver satisfaction, the driver hours that they’re able to reduce and leverage them for other things in the equation. You then go into the manufacturing side of the house. We all know when it comes to preventive and predictive maintenance, particularly now around predictive maintenance, this technology is being widely leveraged both for equipment monitoring and then through that monitoring, being able to detect and then send the right level of alerts, in some cases also do autonomous actioning to reduce the downtime to better the maintenance and the life of the equipment in question.

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[00:25:07] Scott W. Luton: I love those examples and I want to add a few more and Tevon, these might ring a bell with you because we’ve talked about some of these together in previous shows. Freight invoice auditing — some of these big-time shippers, you can’t throw enough people at auditing and getting invoices right. And it creates such a resource suck, for lack of a better phrase, tons of friction. AI is being applied in incredible ways to really alleviate that. Parcel shipping — “where’s my stuff?” That can take thousands of hours each week answering and taking care of the consumer and giving them information. AI is changing that game dramatically. And one of my favorite recent examples, not too long ago, we had a big-time CPG player that a lot of folks would recognize — taste of new generation, I’ll put it — and they were deploying big-time agentic AI and decision automation solutions out amongst their warehouses and get this, they had at one point per month in this part of their warehousing ecosystem, 14,000 exceptions that required manual interventions per month. 14,000. And do you know where they took that number to? Once they acted on the art of the possible and brought in agentic AI to eliminate decisions or enhance their team’s ability to make better decisions, they took that 14,000 number down to 27. You heard that right — 14,000 to 27. You think people had some more time on their hands to protect, not do as much overtime and enjoy their weekends. I mean it’s remarkable. Tevon, your thoughts.

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[00:27:05] Scott W. Luton: That’s right. And better environments, more success, better days for your people. And that’s my favorite element to this whole golden age of supply chain tech story that we continue to build chapter by chapter. So Gaurav, speaking of agentic AI, it’s just remarkable what’s going on. Let’s dial it in more there because we’re truly hour by hour unlocking more and more of the autonomous supply chain. And I hope I’m using that word correctly because Gaurav, as you mentioned, folks are throwing that around left and right out there. So let’s talk about this. Are there specific areas where agentic AI is already demonstrating — beyond what we’ve referenced — maybe already demonstrating its potential in factories and in supply chain? What else are you seeing there?

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[00:29:07] Gaurav Malhotra: That’s what some of the examples that we all talked about earlier and or some of the newer ones, particularly from an end-to-end perspective, is what companies are starting to use agentic for. And I’d say particularly around unforeseen macro conditions, whether that has impacted ocean drastic patterns that now a company is having to react to see how they can still meet the service levels or minimize that disruption, and they’re using agentic to be able to analyze the network across the patch globally. And then through that analysis, this technology then gives them the recommendation. In some cases acts on it. You can use these types of alternates to minimize the disruption and still be able to hopefully meet your service levels to your customers essentially. The second is now around this whole network analysis, not around a disruption but call it around these tariffs and everything. I mean how do we use this technology to quickly analyze our historics if you will, and then tell us how should our network overall be placed so that it is much more resilient to these type of unforeseen and or even foreseen changes and we still are cost effective both internally but then more importantly to our customers.

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[00:30:47] Tevon Taylor: We’re moving from just offering and analyzing to taking action within certain guardrails. But the way I look about agentic, I look at it like, hey, don’t just tell me something’s going to fail, schedule how to fix the failure or the part, adjust the production, right? So it is taking it the next level where engaging in that action part that you never saw before. It’s not just analyzing, it’s analyzing and taking action.

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[00:32:24] Gaurav Malhotra: I think first it starts with all of us getting a deeper, good understanding of this technology because it’s almost a given that we can’t escape this, so we have to embrace it. And I just tell everybody that we get an understanding and embrace it because to your point, it’s something that is only going to complement things and that embracement should be with that level of understanding. Once that’s done, I think what this is going to do is leave humans for really creative critical thinking and through that creative and critical thinking focus on unique things that are highly complex in nature that they need to focus on because their involvement is necessary and then divert the rest of their attention and the rest of their energy towards the enterprise differentiation in other ways that they are able to contribute to essentially. And that’s how supply chains — again, we’ve now talked about many times that this leads to the potential that we’ve all been waiting for and it is going to get real. And through that now humans all have to focus towards those creative critical things as well as differentiation further. And that differentiation can be new channels, new products, new offerings, new business models that we can then think about versus running and executing on supply chain mundane tasks if you are right.

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[00:35:04] Tevon Taylor: Yeah, two things. One is I’ll quote the late Fred Smith. He said, if you don’t like change, you’re not going to like extinction either. So that’s the first. So you do need to embrace it, but I love that point, humans will be in the loop. There are things that humans excel at, like creative problem solving and navigating ambiguity that you’re just not going to see AI do in the short term. But more importantly, there should be other things you’re focused on trying to invest in things. I mean, think about your daily — I think the point was made — adding productivity over the mundane task. There are things you could be doing versus the mundane task that if you had AI doing that, it’s just going to further things all humans are doing. But I do like Fred’s quote because he said it quite a bit, he’s right. We’ve got to embrace that change, embrace AI or face extinction of whatever job function or whatever you’re doing.

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[00:36:12] Gaurav Malhotra: There we go. We’ve got the gig in common there, Tevon.

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[00:37:09] Gaurav Malhotra: I think in line with the discussion that we just had, Scott, I see this to be one of the most important elements that can set a company aside in a positive manner through again the evolution and the journey we’re on so to speak. And this cuts across industries, by the way. And yes, almost every one of our clients and or every company that you hear of is focused on that piece of one: how do we ensure that we uplift our current workforce to again have a deeper understanding and embracement of this technology? We call it AI in everything we do because the applicability is such in whatever shape or form in everything we do. And it starts with first an education, a deeper understanding, and I see many of my clients and other organizations leveraging different formats to be able to uplift that education within their workforce as a whole.

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[00:39:39] Gaurav Malhotra: We’re going to have a bunch of prompts that we will either send out or will be sent out on our behalf because of whatever workflow and algorithms we have, and they’re going to do a bunch of actions for us, if you will, and make our lives easy, give us the responses and our insights. And then that same thing is going to start to translate into the enterprise world not too far from there.

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[00:41:18] Tevon Taylor: I’m starting to laugh because you say value stream mapping and that seems like just yesterday, but we’re aging ourselves. I had a customer actually email me yesterday and I said a term that’s a little old-fashioned in supply chain and they replied and said, that’s old-fashioned. Then they came back because they realized they were being ageist. But when it comes to approaching it, upskilling, reskilling — that’s table stakes. There needs to be AI training, that cross-functional rotation, kind of dipping your toe into what’s changing. I wrote down the parallel to the internet because again, it seems like yesterday we’re listening to the dial tone of AOL and we’re like, this is so cool. The websites were horrible looking, there wasn’t really a lot of data, but our brains didn’t wrap around where we’d be today. Just like in 20 years from now, we’re going to go, how did we not see this? But the most important thing that I’d say is that companies really need to realize that it’s not the technology alone that delivers the value, it’s the people. So the people are still delivering the AI, the people are still supporting it, just like pilots still are flying planes that are highly automated compared to what they used to be. It’s the people behind it. That’s really what’s going to make this happen.

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[00:43:27] Gaurav Malhotra: I think that is paramount. Keeping humans at the center of this. I think Tevon just said it’s technology and yes, it has a large potential, but just an enabler if you will — and yet a huge enabler — but humans are the ones that are necessary to be able to think through the right leverage with the right outcomes and value that gets driven through it. And humans are the ones that have to embrace it, drive the right change and uplift themselves and the community and ultimately the organization through the cycle, if you will. And time and time again, even through this, we have seen that organizations that have kept humans at the center through it — in fact, we have an approach, and this is through research with Oxford University, where we talk about this from the standpoint of humans at the center, so to speak, exactly the term we use — is so necessary. And if you don’t, this transformation is not going to lead to the right results sets that you’re looking for, the right level of adoption that you’re looking for, not within the organization, but then outside as well. But humans have to be at the center, want to think through how to leverage and bring it all together and convert those, what I call moonshot and or bolder things, to reality, ultimately to adoption.

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[00:46:06] Tevon Taylor: It’s a simple story and I could tell many stories of success and failure based on this key point. So if you bring your operations, your sales, your marketing, the planners, the frontline employees — if you bring them into the pilot or the design phases, guess what? They’re going to embrace it a lot faster. They’re going to adopt it. It’ll be part of your culture. If you don’t, then you’re going to recognize the pain and suffering of not including them because then there’s going to be the fear factoring. And storytelling happens if you don’t tell a story. And what I mean by that is if you don’t involve your employees on the front end, they will make up their own stories and start storytelling amongst themselves. Next thing you know you’re fighting that machine versus them going, this is amazing, right?

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[00:47:30] Gaurav Malhotra: Yeah, it’s a tough one, but obviously a valid question, Scott. One, I’ll start by saying — and this is based on history with several other emerging technologies, RPA, IoT, blockchain, VR, AR, et cetera — this certainly has a much broader, much deeper potential in supply chains and more, and it’s a given. We can’t run away from it. There is a notion that within five years, or at the point of five years or so, this technology in almost every case may become more intelligent than humans, if you will. And that’s a scary thing to kind of think through. But that’s the evolution. That’s where we’re headed. And by then, I do think for a lot of the organizations, this technology will lead their supply chains to a much tighter orchestrated, cognitive, autonomous supply chain — no question. And supply chain practitioners, supply chain individuals are going to be thinking about bringing very unique, bold differentiation through other elements.

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[00:49:43] Scott W. Luton: Gaurav, well said, well said. And Tevon, what I heard there from someone in the know, that’s a lot closer to the bleeding edge of technology than I am, is there’s lots of reason for very practical optimism about where we’re going. And yes, there’s some uncertainty and there’s anxiety, but there was with any technological revolution throughout history, right? And those that see it for the opportunity that it is and find practical ways of upskilling and finding opportunities and learning new things, they’re going to be in better position to enjoy the fruits of all of this incredible innovation and transformation. But Tevon, what did you hear there?

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[00:50:53] Scott W. Luton: That’s so true. That is a — you can take that prediction to the bank, Tevon, that’s a great call out. So one last thing. One of the things that Gaurav mentioned was the intelligence factor and how it’s really going to — I mean, gosh, it’s rivaling the human intelligence factor. We’ve already talked about the differentiating things between them, but it’s amazing. It’s really amazing. Play around on ChatGPT if you don’t believe me. But I want to just a little throwback, folks. Go watch — there’s a great movie that came out, I think it was 2013, and our loyal listeners and watchers know I mentioned this before — but Joaquin Phoenix was in a very unique movie called Her. And I watched that movie and I was fascinated with it before I even began to understand artificial intelligence. And now I think it’s even more relevant than it was 12 years ago. So go find it. I’m not going to ruin the ending, but it will make you think along a lot of lines that we’ve touched on here today. Alright, Gaurav, great, outstanding episode. I want to make sure — I bet you’re really busy keynoting, working, delivering value, bringing the power. I bet you travel a lot as you work with leading businesses and innovative leaders out there. But how can members of our audience track you down and have a fun shop conversation with you?

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[00:52:23] Scott W. Luton: Outstanding. And we got to get ahold of some of those pictures from that outstanding pilgrimage. I’m so glad that you’ve been with us, Gaurav. Alright, so Tevon, before we sign off here, before I thank everybody, I got to get your patented key takeaway here today from what we heard from Gaurav.

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[00:53:15] Scott W. Luton: Oh, absolutely. Good, practical, actionable takeaways. And I would just add to your key takeaway there, as Gaurav was talking about — the right strategy to avoid that pilot purgatory, man, targeted building trust along the way, including the people, that transparency that you need and applying it to the right problems. And folks, you don’t start with the solution. You don’t grab a hammer and go chasing nails, right? As the old analogy goes. You try to figure out what the problem is first, right? What are we trying to solve first and then work backwards to find the right solution, AI or otherwise. But what an outstanding conversation here today. Gaurav Malhotra, partner and supply chain technology leader with EY. Gaurav, thank you so much for being here. And we’re going to have to go through your agent on that rock-and-roll tour, I’m sure, sharing your expertise around the globe, but we’re going to have to have you back for a second coming soon.

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[00:54:19] Scott W. Luton: You bet. We’ll do it on the scene up in Chicago and consume some terrific pizza and tasty adult beverages, Tevon, as we do it. But Tevon Taylor, the one and only Sheriff Taylor, as you’ve earned the new nickname around here, always a pleasure to knock out these conversations with you.

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[00:54:37] Scott W. Luton: Appreciate what you do out in the industry. And folks, make sure you connect with both Gaurav and Tevon on LinkedIn. But hey, to all of our audience members out there, hope you’ve enjoyed this episode as much as I have — lots of practical, actionable expertise from our guests here today. But you’ve got some homework: you got to take one thing, at least one thing that Gaurav and Tevon shared here today, put it into practice, share it with the team. Deeds, not words. That’s how we’re going to keep transforming this incredible global supply chain ecosystem that we all play a role in and leave no one behind. So with all that said, Scott Luton here challenging all of you out there: do good, give forward, be the change that’s needed, and we’ll see you next time right back here on Supply Chain Now. Thanks everybody.

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