Analyst Insight: The most forward-looking supply chain organizations recognize that one of the most transformational aspects of artificial intelligence is its ability to help improve existing processes and create new ones, bringing operations more closely in line with business strategy. AI offers the ability to tighten up processes, making it easy to turn fragmented workflows into connected, data-driven systems. The result is faster execution, reduced waste, and real-time visibility. 

Everyone’s talking about AI’s potential for improving productivity, but far fewer are using it to improve processes. The pressure to maximize supply chain efficiency has never been greater, as supply chain managers look to AI for improvements to their systems. But as AI tools become more accessible, many companies still struggle to connect automation efforts to strategic outcomes.

There’s one clear reason for this disconnect: Strategic outcomes aren’t linked to systems. Improve the operational processes and you improve the enterprise, which is a core strategic goal for every supply chain.

Before applying AI to a system, apply it to the process. AI technology can instantly create, map, analyze, improve and document processes for maximum performance. These AI tools are affordable, easy to use and available to anyone with an internet connection.

AI doesn’t simply make existing processes faster; it makes them smarter. AI technology accesses data beyond your enterprise, and uses it to maximize operations. It identifies bottlenecks invisible to human teams, and recommends corrective actions that can be aligned with key performance objectives and overall strategy.

The days of extensive process improvement projects are long gone. Today, anyone can access AI to improve their operations. A supply chain manager can upload an operations document to an AI application and have it map the process, analyze it, suggest improvements and document a new standard operating procedure — all in less than five minutes.

All this sounds great, and it is, but it’s not a blanket endorsement to blindly accept and apply AI processes to your enterprise. A key component in achieving effective processes is understanding the cultural and strategic aspects of an enterprise.  AI is based on large language models and knows nothing about an enterprise’s culture. Every solution proposed by AI should be reviewed for both accuracy and applicability to your enterprise.

The most advanced supply chains are integrating AI into process design, before looking at IT systems implementation.  Previously, AI was used purely for analytics, the synchronization of procurement, and inventory strategies derived from demand forecasts. AI was great for number-crunching. Now, generative AI can do much more. 

Technology alone is not the solution. Organizations seeking long-term success are those that treat continuous improvement as a strategic discipline, not an IT project, making it a foundational part of their culture. They empower everyone in the enterprise to look for ways to make things better. New generative AI tools take this approach to the next level.

Resource Link: https://efficiencygroupllc.com/

Outlook: A new generation of supply chain leaders will use AI technology to drive systemic improvement throughout their organization; not just automation. Today, generic AI tools such as Copilot and Gemini are available on every desktop, but offer limited use beyond crafting an email or article. Soon, AI applications that drive strategic performance, like process improvement, will be on every desktop.