Implementation of AI in Different Processes of Supply Chain Network

AI: Transforming Supply Chains by Lowering Costs, Meeting Demands, and Ensuring Reliability.

Reflecting on the past, where warehouses depended on manual labor for quality checks on thousands of products or tasks fraught with safety concerns, today, AI effortlessly handles these tasks with precision, eliminating errors and ensuring utmost safety.

The supply chain constitutes a comprehensive network spanning from suppliers to final buyers, encompassing the strategic processes of raw material procurement, manufacturing, and culminating in the final product's delivery to end consumers. It stands as a pivotal cornerstone within any business operation, often serving as the critical determinant in achieving success or encountering setbacks.

The 2020?pandemic?and other?geopolitical?disruptions have shown that how weak supply chains can hinder the overall performance of any business and how seriously supply chains affect the business. So now businesses are more and more investing in digital solutions to make their supply chains more optimized and efficient.

Artificial intelligence (AI) in the present day, is one of the main factors in the digital era in which every industry or business is adopting it and making a use of it. With implementation of AI businesses are automating their tasks and getting ahead of their competitions. This graph below portrays the results of AI adoption in the supply chain and manufacturing businesses and how the trend is increasing as results from 2022 and 2025 shows significant differences in the adoption of AI percentages and how important is AI for businesses.?

Global AI adoption rate in supply chain and manufacturing businesses (2022 and 2025)

Source:?Statista

Supply Chain Automation is only possible with the use of AI technology. There are different branches of the supply chain which can be automated like digital workers, warehouse robots, autonomous vehicles, RPA, etc.

• Warehouse automation is done to drive efficiency, reduce costs, and drive safety. With automation, shortage issues of inventory can be resolved and some high-risk tasks of warehouses can be automated by robots to achieve more productivity with no safety concerns. It is an increasing trend and big names like Amazon are implementing it.

Below is a link for Ocado, a tech company and how they have automated their grocery sector by the help of robots.

• Automated quality checks are possible with the use of computer vision (CV) systems which help in automating the task of quality checking with 100% accuracy. These systems are best as they perform 24/7 without tiring or taking rest unlike humans and error free. Hence help in saving time and providing results. BMW uses this technology to scan car models on their assembly line which previously was done by humans.4

See the video in the link below of how BMW implemented computer vision (CV) systems.

• Automated inventory management is done by AI/ML and automates repetitive tasks related to inventory management like scanning and can provide real time forecasting and predicting the demand. The days of forecasting on historical data have gone, now AI predicts and forecasts on live data. It also does inventory optimization and helps in preventing the Bullwhip effect. Ikea is using a demand forecasting tool with AI embedded in it to make accurate forecasts and improved decisions making.

Predicting the future isn’t magic, it’s artificial intelligence. Dave Waters

• Transport Automation is also an increasing trend as most of the mode of transportation is road and there is a prediction that there will be shortage of truck drivers so Amazon and Tusimple are automating their transport network. Nuro a startup , is also focused on this topic and building self-driving delivery vehicles. It has replaced the seats with storage spaces and is revolutionizing the last mile delivery of groceries.

To recapitulate, Artificial Intelligence is changing how the supply chain was. With implementation of AI in any part of the supply chain, you can not only move ahead of the competition but you can make it to the top with reduced costs, improved efficiencies and more accurately forecasting what is coming ahead which you would not be able to see without the help of AI. Hence AI is the way forward in the supply chain process from start to end and has changed the ways of how businesses were done in the past.