Building Smarter Supply Chains with AI – Part II

March 7, 2021

Nearly 60% of supply chain professionals anticipate that their departments will rely on AI in some manner by 2025 – MHI.

With the business environment and consumer market changing at an unprecedented pace, businesses are slowly embracing AI-based solutions to make their supply chains more resilient and efficient. Early adopters of AI can proactively mitigate disruptions, drive agility, and enhance supply chain predictability through accurate forecasting and greater network insight. From a business perspective, this will translate into new opportunities for cost savings; risk mitigation; and faster, streamlined processes.

AI opens limitless possibilities for supply chain enhancement. This two-part article focuses on some transformational use cases that can help organizations build future-ready, intelligent supply chains. In Part I, we covered  the role of AI in enhancing the accuracy of supply chain predictions and logistics planning and optimization. Part II will focus on the use of AI in improving transparency and collaboration, and in making supply chains safer and more efficient.

Different industries have distinct sets of challenges and use cases;  the ones that we  covered in these articles are only a small segment of the possibilities of AI. As a member of the Scale AI community, Adastra welcomes innovative ideas for AI application  in supply chains that can help secure funding for eligible projects.

Improving Supply Chain Transparency

A single disruption in the supply chain can have detrimental effects on the entire ecosystem of interrelated processes. Supply chain visibility breaks down organizational siloes and provides stakeholders across the supply chain with real-time data on everything from ordering to delivery. This allows for streamlined responses to any  potential disruptions and roadblocks.

Artificial intelligence enables intelligent, end-to-end visibility so businesses can extract actionable insights to reduce disruptions; increase efficiencies; and discover new opportunities for cost savings. Machine Learning solutions can help businesses accurately predict cycle times and provides real-time alerts in case of a process anomaly.

Real-time visibility improves aggregation of orders across channels and allows for greater  order management control. AI can support real-time supply chain monitoring systems to gain added insights to help organizations monitor and manage inventory based on evolving demand-supply activity.

Organizations are also discovering the benefits of bringing their suppliers and vendors into their smart supply chains. An example benefit is better end-to-end integration. AI-powered solutions can also enhance traceability and accountability across the supply chain by taking down barriers and creating a unified version of the truth for all stakeholders.

Supply Network Collaboration

Managing a network of suppliers can be an extensive task. However, seamless supplier relationships are crucial to the business. AI can help enhance supplier integration and collaboration by automating routine transactions to increase productivity, reduce costs, and save time for all parties. With AI capabilities like anomaly detection and cycle time prediction, organizations can resolve supplier issues more efficiently and reduce the incidence of disruptions.

Supply chains involve lots of paperwork with multiple parties placing, confirming, and paying through purchase orders, invoices, credit notes, and son on. AI solutions like automated document recognition and processing can extract and summarize key pieces of information for effective validation and reporting needs. Automated AI Chatbots can also streamline communication between suppliers and customers for routine purchase requests and trivial conversations. These solutions can reduce manual involvement in these processes, strengthen collaborations, and make the supply chain more efficient.

Transparent supply chains allow businesses to predict future events and work together with the suppliers towards the common goal of serving the customer. Evolving market dynamics and demand can demand the recalibration of supplier relationships or the onboarding of new ones. AI-based predictions can help organizations make smarter sourcing decisions to protect business margins, minimize capital tied up in slow-moving inventory, and effectively fulfill orders.

Efficient and Safe Facilities

Even when your supply chain operates with no apparent issues or disruptions, there is always room for improvement. AI allows you to tap into hidden data and apply optimization models to improve facility planning. Better placement of items in a warehouse can streamline workflows and reduce time and operational costs. AI can also play a role in pallet optimization to increase loading efficiency, reduce the number of pallets to be delivered, and decrease costs and carbon footprint.

Autonomous picking or packing robots – coupled with AI-based planning systems – can reduce preventable errors to warehouse goods, increase productivity and lower costs. Autonomous trucking, while still a few years away, will be a breakthrough in supply chain logistics. Their omnipresent ability will/can …The ability for trucks to be operational round-the-clock will reduce freight times, decrease transportation costs, and reduce the rate of accidents that occur due to driver exhaustion and manual errors.

The use of automated devices, like autonomous mobile robots (AMRs) which can navigate around obstacles, can enhance safety, and reduce the risk of injuries and accidents on the warehouse floor. These devices, which can automate order fulfillment, rely on AI technology and RFID tags implanted in the warehouse floor.

Although AI and Machine Learning solutions have been used in the supply chain industry for over two decades, their adoption is still in the pilot stages as new use cases emerge daily. Artificial intelligence opens the door to endless possibilities for reducing costs, enhancing efficiencies, and streamlining the supply chain with better visibility and control over the ecosystem. Supply chain leaders across the world already use AI to uncover real-time insights and make faster, better-informed decisions. In the current competitive business environment, it is apparent that AI-based smart supply chains will be the next frontier for business growth and superior customer service,  even in times of uncertainty.

With 20+ years of expertise in the AI & Analytics space, Adastra can help you design and implement advanced AI solutions for your unique supply chain use cases. Our experts possess proven experience in custom-building solutions for various aspects of the supply chain, ranging from demand forecasting to automated document processing. Our team  can help you reduce supply chain disruptions, enhance the accuracy of your predictions, and make your supply chain more efficient and future-proof.