Artificial intelligence (AI) is transforming the way we do business, and the supply chain industry is no exception. With AI, companies have access to unprecedented levels of data that can be used to optimize processes and improve efficiency. However, a question remains: are suppliers ready for the changes AI will bring? We’ll try to answer that question and take a look at how artificial intelligence is impacting the supply chain and what suppliers need to do in order to keep up.
What is Artificial Intelligence?
AI is rapidly changing the supply chain landscape. By automating processes and increasing visibility AI is helping create a more efficient and cost-effective supply chain. However, as AI continues to evolve and become more widely adopted, suppliers must be prepared to adapt their operations to stay ahead of the curve.
In its simplest form, AI can be defined as a computer system that is able to perform tasks that typically require human intelligence, such as visual recognition or decision making. AI can be used to automate repetitive tasks, such as data entry or order processing. Additionally, AI can be leveraged to provide real-time visibility into the status of orders and inventory levels across the supply chain. This increased visibility can help identify issues early on and prevent disruptions further down the line.
AI is already having a significant impact on the supply chain, and this impact is only expected to grow in the coming years. As suppliers begin to adopt AI-powered solutions, they will need to invest in both technology and talent. Those that do so will be well-positioned to compete in the future landscape of a digitized supply chain.
AI for Suppliers: The Right Moves to Make?
The advent of AI is posing both challenges and opportunities for the supply chain. On the one hand, AI can help to improve efficiency and accuracy in various areas of the supply chain, from material handling to forecasting. On the other hand, AI-powered automation is causing some jobs to disappear, while also creating new ones.
One area where AI is having a major impact is material handling. Automated guided vehicles (AGVs) equipped with sensors and lasers can navigate warehouses and factory floors without human intervention. This not only increases efficiency but also reduces the chances of errors or accidents.
In addition, AI can be used to improve forecasting accuracy. By analyzing past data and trends, AI-powered software can make more accurate predictions about future demand. This information can then be used to optimize stock levels and production schedules. As a result, businesses are less likely to experience disruptions due to out-of-stock items or excess inventory.
The latest AI technology is also changing the way suppliers interact with their customers. In many cases, customers now expect supplier interactions to be automated and personalization options to be available. For example, when ordering products online, customers often expect to receive recommendations for similar or complementary items. To meet these expectations, suppliers need to invest in AI-powered customer relationship management (CRM) systems that can act somewhat as an automated customer service alternative.
AI can also be used to monitor customer purchase patterns and predict future demand. This information can then be used to adjust production schedules and inventory levels to meet customer needs. This technology can also be used to identify potential issues in the supply chain and recommend solutions, improving efficiency and reducing costs.
AI is having an impact on the staffing as well. As more jobs become automated, new skillsets and job roles are emerging. Companies need to ensure that their employees are trained in these new skills to remain competitive. Additionally, businesses are now investing in AI-powered recruiting and hiring solutions to find the right talent for their organization.
In general, AI is a great benefit for supplier organizations. As more customers leverage AI and other forms of technology, suppliers must keep pace and invest in technology specifically suited for the order-to-cash side of the equation.
Artificial Intelligence has already had a major impact on the supply chain, and it will continue to do so in the future. AI can help streamline processes and improve efficiency, allowing suppliers to provide better customer service while reducing costs and saving time. This technology is here to stay, so suppliers must prepare now and embrace its potential. With the right preparation and attitude towards AI, suppliers can ensure that their business remains competitive in today’s ever-evolving global economy.
Ernie Martin is Founder and Managing Director of Receivable Savvy. He brings over 25 years of experience in financial supply chain management, marketing and communications and draws upon his extensive experience to share knowledge and best practices with AR professionals. He previously chaired the Vendor Forum of the Federal Reserve Bank of Minneapolis and his resume includes time at several well-known brands and companies such as Tungsten Network, Delta Airlines, CIGNA Healthcare and Georgia Pacific as well as a number of years as an independent consultant.
