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Three Ways to Apply AI for Supply Chain Optimisation
July 3, 2020 Blog


Managing supply chains in the modern era is a complex juggling act, to say the least. Businesses have to be able to meet rising consumer expectations and demands and collaborate as effectively and efficiently as possible with different parties and entities across the supply chain – all while mitigating ever-present risks and market uncertainties.

Legacy supply chain models, which were built on siloed data and error-prone manual processes, are proving to be ineffective systems in an age of immediacy. Organisations need to transform and optimise their supply chain by tearing down silos and increasing visibility and transparency to ensure that operations are more agile and open to collaboration.

Artificial intelligence (AI) is a technology that helps businesses maintain control over their data and processes. One critical attribute of AI is its ability to sift through massive amounts of data quickly and cut through the “noise” to provide comprehensive analysis and insights. With these capabilities, AI can optimise supply chains in several important ways.


Establish Real-time End-to-End Visibility

AI can connect data across siloed systems. Its ability to correlate data from disparate sources gives businesses a complete view of all the information across ecosystems and sheds light on the problem of “dark data” – or data that is collected and stored, taking up valuable space, but is unstructured, uncategorised and ultimately left unused.

When it comes to multi-component orders, AI can monitor and correlate relevant data and assess things like order status and financial risk. It can even scour for information about market and supply changes that can lead to delays. If a link in the supply chain is disrupted, businesses can easily identify which orders are affected, with alerts for late deliveries sent automatically.

These processes and queries, which take hours to do manually, can be carried out in a matter of seconds with AI. Automating simple tasks and having a greater level of visibility helps enterprises manage supply chain complexities with ease and efficiency.


Unlock Valuable Predictions and Insights

By being able to process petabytes of data across any number of internal or external systems in real-time through cognitive automation, AI can offer recommendations and predictions beyond what humans are capable of.

As previously illustrated, AI simplifies the search for necessary information across diverse systems. But AI can go beyond that to predict disruptions and other problems before they occur so companies can take preventative or corrective measures. While a logistics operator may be able to make educated guesses based on a handful of data points, AI-based predictive analytics provide higher levels of accuracy and analysis by reviewing thousands of data points at once.

From keeping track of inventory levels to evaluating supplier selection, having the capability to draw on data-driven insights can help organisations uncover new savings opportunities they couldn’t see before, make faster and more informed decisions, increase efficiencies and reduce costs.


Boost Productivity and Operational Efficiencies

Based on the examples provided so far, you may have an idea about how much time and effort can be saved with AI-enabled supply chains. To give you a clearer picture, let’s take a look at some actual numbers from real-world use cases.

According to a study conducted by IDC, organisations that used IBM’s Sterling Supply Chain Business Network with Business Transaction Intelligence to transform into a “smarter” supply chain were able to:

  • Increase operational efficiencies by 30 staff hours per week
  • Improve their ability to handle data-related issues
  • Improve visibility and save up to six hours per week for warehousing technical teams
  • Enhance customer satisfaction with much better support

However, AI is not just about crunching data. It is also making waves in other areas of the supply chain, such as logistics (computer vision, autonomous robots and vehicles) and customer service (chatbots and conversational AI).

These are just a few different ways that AI can be applied to optimise supply chain performance. Recent global events have brought on unprecedented supply chain challenges. Technology such as AI will play an even greater role to empower businesses to automate processes, increase efficiencies, manage critical inventory, meet customer demand and mitigate disruptions.

Besides Sterling Supply Chain Business Network, IBM is offering a number of its key supply chain solutions for free during this uncertain period. IBM’s global team is also available to share their expertise to help you optimise your supply chain.

For further info and to take advantage of IBM’s various no-charge offers, click here.