Artificial intelligence is expected to significantly impact supply chains by 2023. AI’s value lies in more than the automation of tasks. It opens opportunities for organizations to focus on strategic problem solving, relationship building and predictive insights. AI brings the latest, best, and most relevant information to employees through intelligent capabilities. Although AI is “smart” automation, its success still depends upon people — the organizations and employees who deploy it.

Artificial intelligence is still in the early stages of adoption within supply chains. In an APQC study of 1,000 participants, roughly 38% have piloted AI, and only 13% have actively used it for more than two years. But the technology’s future is clear: 40% of organizations are currently considering AI for the supply chain.

To reap the benefits of AI, organizations are reconsidering their workforce needs. Contrary to popular belief, people aren’t being replaced by AI. For every percentage of full-time-equivalent employees eliminated or redeployed due to AI, respondents reported an equal or greater increase in full-timers added or hired. Rather than replacing employees, AI is changing the skills needed by supply chain professionals.

Successful organizations must have the right mix of skills within their workforce to support AI and use the technology strategically, so they’re investing time and money in reskilling and upskilling their employees. Their supply chain employees are trained to extract insights from AI and utilize that information for strategic analysis and complex problem solving. Organizations that harness the strength of AI also foster creativity and innovation among employees, skills that are critical to meet the shifting nature of the modern supply chain. Companies that effectively implement AI cultivate supply chain employees’ communication and interpersonal skills, improving their focus on nurturing relationships with stakeholders, partners, and suppliers.

The companies that most effectively navigate workforce changes brought on by AI are those that are committed to change management. Understandably, employees often feel anxious about what new technology means for them. If employees feel the changes to their positions aren’t simply being thrust upon them, but that their employer is building their skills and “future-proofing” their positions, then they’re more engaged. The most successful organizations adopt a formalized and systematic approach for upskilling, cross-skilling, or reskilling employees. One example is Swedish telecommunications firm Ericsson, which embraced automation and began cross-skilling its shared service center employees with a mix of technical, analytical, business and communications skills. The company saw a 30% improvement in efficiency as a result.

Outlook:

Anticipate increased efficiency and resiliency among organizations that invest in both AI and the formalized, systematic reskilling of their supply chain workforce. Across the board, organizations using AI point to the impact the technology has on time, from providing real-time data to reducing delivery timelines and improving time-management practices. With better use of time comes space for a retrained workforce to strategize and effectively adapt to whatever is next.

Marisa Brown is senior principal research lead, Supply Chain, with APQC.