Picture this: Your customer emails a request for a quote for 50 widgets. Imagine if that request could process itself – instead of your already stretched customer service reps adding to their long list of to-dos:
Checking inventory, verifying pricing, entering the data into the ERP and sending back a quote – all while your reps focus on building customer relationships.
When the customer replies, the sales order is automatically entered into the system, inventory updated and the warehouse notified to prepare the shipment.
This is the reality of the latest wave of AI technology: AI agents.
Despite the futuristic name, AI agents aren’t robots waiting to step in and do your team’s work. AI agents are primed to transform how your team works. They take care of the repetitive tasks that can slow your business down.
The term “agent” comes from the word “agency,” which means the ability to do things with minimal human intervention.
AI agents act based on their understanding of the environment and the instructions they are given. At their simplest:
- You tell the AI agent what you need it to do.
- You’ve trained it on the task using examples and rules it needs to follow.
- Once it understands, it can start working.
- Before it finishes, the AI agent will confirm its work was accurate.
Let’s go deeper into the order-processing example to show how AI agents can transform operations:
For years, distributors have worked to make taking and processing orders easier. Early on, everything had to be done manually. Sales reps would make a call or handwrite a sales order. Then, the emergence of EDI and e-commerce portals introduced not only more channels but an opportunity to take orders in new ways. Customers could put their orders on an e-commerce-enabled website, and large customers could send their orders from their systems directly to a distributor’s.
But those solutions didn’t modernize and standardize the other ways a customer could send an order:
- Fax
- Phone
Manual work still plagued the process and introduced errors and inconsistencies that would affect a distributor’s ability to fulfill the order down the line. Enter OCR and other template-based systems, which are coded to read a PDF or an email and translate them into what the ERP system needs to process it.
While that technology partly solves a big pain point for distributors – and introduces automation into the process – it has limitations in accuracy, input quality and real-time processing. It also has limited context for what it’s processing, meaning it doesn’t always know what the words on the page mean and it may incorrectly map text to the wrong fields in your system.
This is why AI agents can go beyond what these solutions have done. In this use case:
- They aren’t bound by a template.
- They use generative AI and machine learning to understand unstructured data from multiple formats, so they have context.
- They can handle unique company requirements, such as volume pricing, order splitting or customer-specific naming conventions.
- And they can interact with ERP systems in real time to validate orders, which reduces errors and uncovers inconsistencies that humans can then review.
AI agents can be simple (reacting to a situation based on predefined rules or patterns) or complex (model- or goal-based). Some improve over time by learning from experience. Some of the most useful in distribution are collaborative, working with reps to find information faster and perform repetitive tasks more efficiently.
There are a lot of applications for AI agents in distribution. A few examples include:
- Personalized recommendations to a rep after analyzing buying patterns to suggest cross-sell or upsell opportunities
- Quote generation from customer emails, historical pricing data, inventory and contracts.
- Invoice matching by comparing invoices with purchase orders, receipts and contract terms
- Shipping notices pulled from real-time order, inventory and logistics data in your ERP and warehouse management systems
Again, this isn’t about replacing your team. It’s about doing more with less. AI agents are cost-effective, letting distributors scale without increasing headcount for the tasks no one on your team wants to do – such as entering data into an ERP. Your reps want to be talking to the customer and managing the relationship. People buy from people.
Having an AI agent is like having something on your shoulder to tell you, “I should recommend that this customer buy this particular product.” Or “Oh, what’s that part number again?” View an AI agent as an assistant with a perfect understanding of your business helping out.
Right now, many of the people you hired are locked up behind the screen. AI agents can set them loose; it is about making sure that the high-value people you hire for your company can do the things they were hired for.
Sahitya Senapathy is the CEO of Endeavor.ai.
