Artificial Intelligence in the Supply Chain

Artificial Intelligence in Supply Chain: Insights from David Ogilvie

In a recent episode of the Interlinks podcast, host Patrick Daly welcomed David Ogilvie principal at David Ogilvie Consulting in Brisbane, Australia, to discuss the pragmatic deployment of artificial intelligence (AI) in the workplace. The conversation delved into the applications, benefits, and challenges of AI, especially in the context of supply chain management and enterprise resource planning (ERP) systems.

AI in Supply Chain and ERP Systems

David's business revolves around two primary pillars: supply chain resiliency and ERP systems. He emphasized the interdependence of these two areas, noting, "For me, supply chain and ERP are hand in glove." His work often involves improving supply chain processes through ERP systems, whether in selection, implementation, or restoration to optimal functionality.

AI's Practical Applications

The discussion highlighted several practical applications of AI in business processes. David shared his experience using AI for research and automation, citing its ability to broaden perspectives and streamline tasks. For example, AI can transcribe and summarize client meetings, significantly reducing the administrative burden. "It can generate meeting summaries... automating that type of activity," David noted, referencing the integration of AI in Microsoft Teams' Copilot feature.

AI vs. Machine Learning

A critical point in the discussion was the distinction between AI and machine learning. David clarified, "AI is the broad field of computer science, whereas machine learning is a subset of AI." He shared an anecdote about a client who piloted a machine learning project for demand forecasting but reverted to statistical methods due to reliability issues. This story underscores the trial-and-error nature of implementing AI solutions and the importance of finding the right applications.

Challenges and Scepticism

Despite the promise of AI, David expressed a healthy scepticism. Drawing parallels to the overhyped blockchain technology, he stated, "Blockchain was touted as something that was going to revolutionize the supply chain... It has failed to make a big impact." While he does not place AI in the same category, David remains cautious, emphasizing the need for practical, tangible results over speculative promises.

Future Potential and Areas of Opportunity

David highlighted several areas where AI shows significant potential. One notable example is anticipatory maintenance in asset-intensive industries. By leveraging data from machinery, AI can predict and diagnose issues before they become critical, much like its use in medical diagnostics. "It's diagnosing which of those machines has got a “cancer”, has got an issue that needs to be resolved," David explained.

Furthermore, AI's ability to enhance quality control in manufacturing through precision improvements was another point of interest. By optimizing machine settings, AI can minimize waste, prolong equipment life, and improve product quality.

Education and Skill Development

As AI technology evolves, the need for skilled professionals becomes paramount. David and Patrick discussed the importance of education and training in this field. Patrick recommended free courses from Google and NVIDIA, which offer foundational knowledge in AI and machine learning. "Those who are really interested in it can maybe get a head start," Patrick suggested, emphasizing the wealth of resources available for learning and upskilling.

Conclusion

The conversation concluded with a cautious yet optimistic outlook on AI's future in supply chain and business operations. While acknowledging the current limitations and challenges, both David and Patrick recognized the transformative potential of AI. As Patrick summarized, "There's a whole world of opportunity there for people who can learn about this and who can insert themselves into that space."

For those interested in exploring the practical applications of AI further, resources from tech giants and educational institutions provide valuable starting points. The journey of integrating AI into business processes is ongoing, and staying informed and adaptable will be key to leveraging its full potential.

You can listen to the full conversation here https://www.albalogistics.com/2024/06/12/artificial-intelligence-in-the-supply-chain/

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