• Advertise
  • Contact Us
  • About Us
  • Supplier Directory
  • SCB YouTube
  • Login
  • Subscribe
  • Logout
  • My Profile

  • CORONAVIRUS
  • LOGISTICS
    • Air Cargo
    • All Logistics
    • Express/Small Shipments
    • Facility Location Planning
    • Freight Forwarding/Customs Brokerage
    • Global Gateways
    • Global Logistics
    • Last Mile Delivery
    • Logistics Outsourcing
    • LTL/Truckload Services
    • Ocean Transportation
    • Rail & Intermodal
    • Reverse Logistics
    • Service Parts Management
    • Transportation & Distribution
  • TECHNOLOGY
    • All Technology
    • Artificial Intelligence
    • Cloud & On-Demand Systems
    • Data Management (Big Data/IoT/Blockchain)
    • ERP & Enterprise Systems
    • Forecasting & Demand Planning
    • Global Trade Management
    • Inventory Planning/ Optimization
    • Product Lifecycle Management
    • Sales & Operations Planning
    • SC Finance & Revenue Management
    • SC Planning & Optimization
    • Sourcing/Procurement/SRM
    • Supply Chain Visibility
    • Transportation Management
  • GENERAL SCM
    • Business Strategy Alignment
    • Education & Professional Development
    • Global Supply Chain Management
    • Global Trade & Economics
    • HR & Labor Management
    • Quality & Metrics
    • Regulation & Compliance
    • SC Security & Risk Mgmt
    • Supply Chains in Crisis
    • Sustainability & Corporate Social Responsibility
  • WAREHOUSING
    • All Warehouse Services
    • Conveyors & Sortation
    • Lift Trucks & AGVs
    • Order Fulfillment
    • Packaging
    • RFID, Barcode, Mobility & Voice
    • Robotics
    • Warehouse Management Systems
  • INDUSTRIES
    • Aerospace & Defense
    • Apparel
    • Automotive
    • Chemicals & Energy
    • Consumer Packaged Goods
    • E-Commerce/Omni-Channel
    • Food & Beverage
    • Healthcare
    • High-Tech/Electronics
    • Industrial Manufacturing
    • Pharmaceutical/Biotech
    • Retail
  • REGIONS
    • Asia Pacific
    • Canada
    • China
    • Europe
    • Latin America
    • Middle East/Africa
    • North America
  • THINK TANK
  • WEBINARS
    • On-Demand Webinars
    • Upcoming Webinars
  • PODCASTS
  • VIDEOS
  • WHITEPAPERS
Home » Blogs » Think Tank » Five Ways to Leverage AI in Supply Chain Management

Think Tank
Think Tank RSS FeedRSS

Forecasting & Demand Planning / Supply Chain Planning & Optimization / Technology / Artificial Intelligence / Business Strategy Alignment

Five Ways to Leverage AI in Supply Chain Management

Data Cables
Data cables feed into servers. Photo: Bloomberg.
May 16, 2021
Mike Hulbert, SCB Contributor

It may seem that today’s increasingly unpredictable supply chains have finally bested professional planners, but the reality is that legacy planning software hasn’t caught up to our ever connected and interdependent world. Traditional tools rely on rules-based prescriptive solutions: We make some educated guesses, draw a linear regression on a spreadsheet, and cross our fingers. Deviations from those predictions are “exceptions,” and we manage them with buffers or expedites — locking up working capital, misdirecting production cycles, and frustrating consumers with empty shelves.

There's a better way: restoring perfect flow to supply chains.

The opposite of perfect flow is a phenomenon we call “operations entropy.” It’s the disruption of well-laid plans by forces that are generally thought to be unpredictable. With advances in computers, data storage and machine learning, operations entropy is finally being defeated. Even if your supply chain is starting to leverage AI advancements in prediction, it's easy to go astray. Keep these points in mind to move your organization forward:

Focus on value at risk. Alerts about lack of supply and excess inventory are just distractions from the most critical number in planning: value at risk. All too often planners spend their weeks weeding through alerts without the context or visibility necessary to make informed decisions. Put some compute behind those alerts and quantify the emerging risks to give your entire team visibility into exactly which problems are putting the most dollars on the line. It may still take some time and research to mitigate a thorny issue, but everyone will rest assured knowing they’re working on exactly the right problem.

Don’t settle for anything in a black box. Trust is critical in a high-stakes and maddeningly complicated supply chain breakdown. No AI will have the human intelligence that a planner has, but the AI will have far more rigorously interpreted context than the planner. AI platforms need to expose their reasoning to planners to verify the assumptions, and to give planners the confidence to act on those insights. Making large impactful decisions requires courage and assurance, not just big data and clever algorithms.

Eliminate waste. Waste is the outcome of inaccurate predictions: Inventory buffers mask imprecise demand forecasts, and empty trucks bely logistics oversights. Even factory downtime and defective products can be prevented with better predictive science. Many of these inefficiencies are accepted “business as usual,” but with new predictive tools, it’s time to question every source of waste — like inventory, overproduction, transportation, or even wasted talent.

Turn down the noise. The accumulation of legacy systems of record often adds unnecessary complexity to a planner’s digital workspace. In the course of mitigating a disruption it’s common to have multiple log-ins, redundant alerts, and at worst permissions or visibility issues. AI excels at data manipulation, tagging, categorizing, and correcting many of the data streams that legacy systems produce. AI solutions should make all the relevant data readily available, so planners can focus on mitigating a disruption, not sorting through tangled systems for better visibility on the issue.

Embrace collaboration. The future is human and machine intelligence working together. AI and machine learning applied to supply chain planning is not some future state on an analyst’s hype cycle. The value is proven in production — with the goal of pushing past hyped expectations and seeing real business value.

Supply chain planners didn’t need a pandemic to point out what they already knew: The speed of decision-making within the execution window is critical for supply chains. Now is the time to support supply chain planners and leaders with products built with AI at their core.

Mike Hulbert is vice president of consumer business at Noodle.ai, an AI products vendor for the supply chain and manufacturers.

RELATED CONTENT

RELATED VIDEOS

Wake up to live
“Supply Chains in Crisis”
updates and the latest Supply Chain News!

Subscribe to our Daily Newsletter

Timely, incisive articles delivered directly to your inbox.

Popular Stories

  • Medical drone

    Amazon May Be Proof That Delivery Drones Aren’t Practical

    Last Mile Delivery
  • Warehouse worker

    Why Higher Wages Alone Won’t Solve the Supply Chain Labor Shortage

    Warehousing
  • Adidas

    From Sneakers to Teslas, China Lockdowns Upend Global Supply Chains

    Coronavirus
  • SEC building seal

    Get Ready for the Next Phase of ESG: Mandatory Corporate Due Diligence

    Regulation & Compliance
  • ESG Guide

    Confronting the ESG Imperative in Supply Chains

Digital Edition

Scb may 2022 sm

2022 Supply Chain ESG Guide

VIEW THE LATEST ISSUE

Case Studies

  • 3PL Doubles Productivity With Robots to Fulfill Medical Supply Orders

  • E-Commerce Company Cuts Order Fulfillment Time by 40%

  • Fashion Retailer Halves Fulfillment Time With Omichannel Automation

  • Distributor Scales Business by Integrating Warehouse Automaton Software

  • Fast-Growing Fashion Brand Scales E-Commerce Fulfillment With Whiplash

Visit Our Sponsors

Yang Ming Alithya Barcoding
Blue Yonder BNSF Logistics Generix
GEP GIB USA GreyOrange
Here Honeywell Intelligrated Inmar
Keelvar Kinaxis Korber
Liberty SBF Locus Robotics Lucas Systems
Nvidia Old Dominion Parsyl
Redwood Logistics Saddle Creek Logistics Schneider Dedicated
Setlog Holding AG Ship4WD Shipwell
Tecsys TGW Systems Thomson Reuters
Tive Trailer Bridge Vecna Robotics
Whiplash    
  • More From SCB
    • Featured Content
    • Video Library
    • Think Tank Blog
    • SupplyChainBrain Podcast
    • Whitepapers
    • On-Demand Webinars
    • Upcoming Webinars
  • Digital Offerings
    • Digital Issue
    • Subscribe
    • Manage Your Subscription
    • Newsletters
  • Resources
    • Events Calendar
    • SCB's Great Supply Chain Partners
    • Supplier Directory
    • Case Study Showcase
    • Supply Chain Innovation Awards
    • 100 Great Partners Form
  • SCB Corporate
    • Advertise on SCB.COM
    • About Us
    • Privacy Policy
    • Contact Us
    • Data Sharing Opt-Out

All content copyright ©2022 Keller International Publishing Corp All rights reserved. No reproduction, transmission or display is permitted without the written permissions of Keller International Publishing Corp

Design, CMS, Hosting & Web Development :: ePublishing