September 29, 2023 | Supply Chain Software
Businesses of all sizes have had to deal with supply chain disruptions in recent times. With too many of these disruptions, they need a robust plan about how to effectively deal with supply-related risks. Along with this, they need to accelerate innovation, enhance customer experience and get end-to-end supply chain visibility all while keeping costs in check.
And to do all this, they must have the capability to derive meaning from the vast amount of data generated in supply chains, most of which is unstructured. This includes not only internal data but also data from external sources that can be crucial in a highly connected working environment.
Ineffective data management leads to inaccurate decision-making, ineffective risk management as well as missed opportunities.
While leveraging technology is vital in the above-mentioned endeavors, it is also key to building supply chain resiliency, which has become a buzzword in the industry. In simple words, resiliency defines the ability of a business to respond swiftly to disruption.
The question now is: how do you identify the right supply chain technology for your business that can address all ongoing issues and achieve the desired results?
The answer is AI.
Technology that is AI-powered can help a business identify potential risks, act proactively and use data in the best possible way. The entire approach in supply chain management changes from reactive to proactive, with insights derived from real-time data and market events.
Accurately predicting customer demand has been a key challenge for businesses across several industries. This has largely been due to the use of traditional methods that rely on historical sales data to estimate demand. A mere review of past data isn’t suited for the fast-changing business landscape today. These methods also do not consider any external factors and their likely impact on demand.
AI-powered supply chain software addresses this issue by unifying all internal and external data in a data lake. It can process a vast amount of data and detect patterns. It also integrates a warehouse management system with other supply chain systems, enabling a business to access real-time data, match vendor demand data and replenish materials quickly.
Additionally, supply chain managers can look beyond macro-level forecasts and forecast demand at a granular level.
For a long time, inventory management has been associated with siloed data, manual processes and lack of visibility across vendors that lead to suboptimal decisions and unnecessary costs.
All these issues can be addressed by an AI-powered supply chain management software that provides a unified view of real-time inventory across different locations, suppliers, vendor-managed inventory and inventory sitting across different ERPs. Synchronized visibility across inventory and warehouse management allows a business to automate replenishment, lower costs and avoid potential shortfalls.
The rapid development of generative AI is expected to impact supply chain management in many ways.
For example, it can expedite data analysis by analyzing large volumes of data from different sources and generate meaningful insights to support decision-making. It can simplify day-to-day operations, improve search capacity and automate tasks.
In procurement, large language models can be used to analyze, compare and summarize supplier bids, enabling sourcing managers to choose the right supplier.
While there can be several use cases of this technology in supply chains, there are also growing concerns of deploying AI in an intelligent and responsible manner.
Given the huge potential of generative AI, it is important to focus on using AI intelligently and breaking it down into micro-steps and processes to ensure they serve their intended purpose, explains Neha Shah, president and co-founder of GEP, in a recent interview with Supply Chain Digital magazine.
The popular opinion today is that generative AI tools can be a game-changer for supply chain and procurement. And as generative AI continues to quickly evolve, this can just be the right time for organizations to gain better understanding, invest in technology and build an agile and resilient supply chain.
Know how GEP is using AI to transform procurement and supply chains for its clients