Current Trends in Artificial Intelligence and Supply Chain
Artificial Intelligence, or AI, is broadly defined to include any simulation of human intelligence processes by machines. While machine learning has played some role in supply chain management for many years, recent breakthroughs in the areas of big data, algorithm development, and processing power have substantially increased the use of AI in supply chain management.
AI is currently being used to help automate a number of aspects of supply chain management including demand forecasting, product planning, and predictive maintenance. Based on recent advancements, there will likely be a continued increase in the use of AI in supply chain in the coming years. Here are some current trends that supply chain managers should be aware of to stay competitive.
Predictive Analytics and Demand Forecasting
AI’s ability to quickly provide a sophisticated analysis of high-volumes of data enables it to identify hidden patterns to increase efficiency, decrease costs, and enable automated planning. Companies are using more and more forecasts to help with supply chain management, including competitor pricing data, store and product data by day, and weather data. In addition, applications are being developed and tested to provide predictive analytics on key machinery, which includes predictions regarding machinery break downs and the creation of alternate production schedules.
Supply Chain Software
AI is increasingly being used in supply chain software to help automate various processes, making systems more efficient. For example, it is currently being used by some companies to automate the time-consuming process of classifying goods for import and export.
AI is being developed that enables machinery to sense and adapt to changing conditions and changing priorities in the warehouse. This makes logistics more efficient and less expensive.
Conversational interfaces, or chatbots, are being introduced to increase efficiency and to improve customer experiences. When done correctly, these automated systems can decrease transactional costs and the sales cycle time.
The use of AI in supply chain management is becoming increasingly competitive, as companies are in a bit of an arms race to determine who can best leverage AI to increase efficiency, reduce costs, and improve customer experiences. The result is that in the coming years, AI is likely to be the deciding factor impacting supply chain management and supply chain superiority. Therefore, it’s essential that supply chain managers are constantly aware of and incorporating AI advances in supply chain systems.
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