Building Supply Chain Roadmaps with AI

View of push-pull models for supply chains.

How Supply-Chain Companies Can Build Roadmaps With AI
September 13, 2019

by Karthik Ramakrishnan and Ben Humphries, SCB Contributors

The supply chain as we know it is on the precipice of tipping from decades of steadily accelerating “push” dynamics to a new “push-and-pull” model.

Four main factors are contributing to this global, industry-wide change:

Today’s increasingly savvy shoppers. Customers live in the digital world and demand a seamless experience. If not, they’ll go elsewhere. This means that the supply chain — which is optimized for “pushing” inventory to customers — needs to add optimization for what customers wants to “pull” to themselves.

The current geopolitical climate. Whether it’s the nationalistic tendencies on display globally, tariff disputes between the U.S. and China, Brexit, or the global focus on sustainability issues, supply chains are more than ever exposed to uncertainty and risk.

Uneven advances in Industry 4.0 and digital supply chain. Factories, supply chains, and stores are becoming more connected, enabling different systems to share information and shrink lead times — but only for companies that are able to act. Production is shifting closer to customers, disrupting long-held patterns of regional trade.

Existing supply-chain technology is at the end of its lifecycle. Legacy software solutions, built to solve a specific, isolated problem such as forecasting or factory planning, are no longer fit for the purpose. To put it simply, this software just can’t keep up.

Enter artificial intelligence for the supply chain. Be it through predictive maintenance in the factory, self-driving trucks in the logistics chain, or automation in the store, AI solutions are emerging to improve efficiency and lower operating costs for supply-chain players. Yet there's a disconnect, as in most industries, around how to fully recognize value from AI. .....  "