Artificial Intelligence (AI)

Artificial intelligence (AI)

Artificial intelligence is a fast developing area that is impacting procurement and supply chain functions which will continue to shape the profession and next generations.  As artificial intelligence (AI) shapes our personal lives, the real applications within organisations continue to simulate discussion and thought processes that could lead to raising productivity levels, increase growth potential and generate competitive advantage.

Artificial intelligence has advanced from the early programmable simple rules based tasks to something much more advanced.  AI can be categorised in two distinct ways:

Rules-Based Automation

A limited automation process, whereby a machine can be programmed to follow a specific set of rules to deliver a desired outcome.  Consider the application in use on a production line where a robotic arm is programmed to pick up a finished product and pack 20 units into a carton.  The robotic arm will have been programmed to work within these parameters.  If X do Y.

Intelligent Automation

With the rise of innovation and competition of industry leaders in the automation world, technology has progressed to a new level of self learning machines being developed, the technology is designed to use cognitive technology that has an ability to self learn and analyse historical patterns in order to make an operational decision.  Consider the application of chatbots who are now offering real time data to users, or in a supply chain environment where a machine can analyse inventory levels and historical forecasting patterns to make a conscious decision to raise a purchase order for stock replenishment.

The benefits to an organisation after initial investment can remove repetitive tasks from their production process, so releasing workforce to focus on a strategic approach to their business model through the managing of large volumes of data in order to drive process improvements and further efficiencies.  Increasingly organisations are more focussed on the efficiencies that can be driven through new technology application.

However to ensure that technology application is the best fit for an organisations transformation model, it is often efficient in the first instance to consider the processes in place, reviewing these for efficiency and wastes, then identifying the best technology to support a process bottleneck or plausible increase in output.

New Technology in the Supply Chain

New tech can support an arena of organisational growth and development.  Key benefits for AI and robotics in a supply chain can be highlighted as:

  • Production line efficiencies, removal of manual tasks
  • Self optimised inventory management
  • Machine wear analysis and component replacement
  • Planning efficiencies with automated order generation
  • Forecasting analysis
  • Demand planning projection based on consumer data analysis
  • Automated pick, pack and despatch
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