Global trade management has always been a highly complex, risky, and strategic business process, despite it being underappreciated at many companies historically. However, if there is one good thing about the tariff wars we’re in at the moment, it’s that global trade management is now in the spotlight, including the role and importance of Global Trade Intelligence (GTI) technology. What is Global Trade Intelligence? How is AI transforming the way organizations manage cross-border trade? What are some concrete use-cases? And how are GTI solutions delivering business value? Those are some of the key questions I asked Ken Wood, EVP of Product Management at Descartes Systems Group on a recent episode of Talking Logistics.
What is Global Trade Intelligence?
To level-set for our audience, I began by asking Ken to define Global Trade Intelligence. Ken describes it as, “The intersection between content and tools to support international trade activity.” As he explains in the short clip below, each company’s requirements for this can vary:
Ken mentions that there is also another dimension which is content coming from public data sources that include global trade flows and activities. This allows companies to do data mining on sources and activity levels associated with goods. This can be especially helpful today in managing fast-changing tariffs and in finding alternate sources of supply. This ability is where the concept of trade intelligence comes into play.
AI and Denied Party Screening
To share some real world use cases for AI in GTI, I started by asking Ken how AI can impact denied party screening. Ken notes that by using the contextual capabilities from generative AI, for example, these solutions can do a better job of sorting through data to arrive at more accurate matches. He says this has significantly reduced the number of false positive hits for their customers.
Agentic AI
Another use of AI in GTI is the creation of agents. Ken states that there is so much room in logistics and supply chain for Agentic AI to create value. “We’re just at the front end of that. It’s about giving AI agents access to the context of the applications and the workflow in order to do things on your behalf.”
One application of this technology, as Ken explains in the clip below, is to enable users to mine global trade data using natural language queries, which provides them with insights faster and in a more intuitive way.
AI and Product Classification
Another area where AI can help with GTI is in the complex and time-consuming process of product classification. Ken notes the whole process is underpinned with the very large data repositories from the World Trade Organization, as well as country-specific interpretations of the data. You have to know what the product is, what it’s made of, where it came from and sometimes what it’s packaged in. You also have to know how the ever-changing tariffs stack on each other.
“These complexities give you incentives to go back and look at product classifications more carefully,” Ken says. “One of the things large language models and generative AI are good at is understanding the contextual relations between the totality of the product descriptions and the totality of the regulations to arrive at an appropriate classification for trade professionals to evaluate. And that contextual knowledgebase continues to grow.”
The Future of AI in GTI
Moving forward, how will AI-driven innovations in Global Trade Intelligence continue to evolve? Ken mentions that there is an ever-expanding trove of trade data and government regulations that can be mined to better understand legal and financial trade risks. Trade professionals might also leverage this data along with changing regulations and trade deals to adjust bills of materials for more favorable classifications.
Ken also thinks improvements in making natural language models easier to use will make it easier for trade professionals to do their jobs and scale their ability to positively impact business results. The key is to view AI as a valuable tool, not an end in itself, because there will almost always be a human in the loop when it comes to global trade compliance.
Cost Justifying a Global Trade Intelligence Solution
One of the hardest things to do when bringing in new capabilities or technology is defining the cost/benefit for CEOs and CFOs. I asked Ken how companies can justify investing in an AI-enabled global trade intelligence solution. He offered some great suggestions, so I encourage you to watch the full episode for his insights and advice, not only on that question but on all the topics we covered. Then keep the conversation going with your own comments and questions.
