The supply chain is the complex network of processes and journeys behind every single product you see on a shelf. A break in the chain could cost a company millions — yet those breaks aren’t always as profound as natural disasters or global pandemics. Sometimes, creeping inflation is enough to disrupt a supply chain’s efficiency with high costs.
The solution? Understanding the impact, down to the last detail, of each inefficiency. But you need quick access and analysis of data to do that before you can improve a supply chain. Hint: sounds like a job for AI.
KPMG recently released a report about supply chain trends and how businesses use AI to keep up. Here are some highlights from the report:
Purpose-built AI applications clean and interpret data
Supply chains have a lot of moving parts, from descriptions and product types to quantities and warehouse details. AI applications can clean up data to gather actionable insights and recommendations, including:
- Inventory numbers
- Duplicate products
- Storage recommendations
- Efficient and non-efficient policies
- Order patterns and optimizations
This quick access to data also helps identify and rectify environmental inefficiencies, like where your biggest emissions come from.
Forbes recently reported that purpose-built solutions ensure all parties operate from a single, trustworthy, and consistent data source, eliminating the need for traditional data cleanses, which can be costly. In the supply chain model, these applications can help read descriptions, identify items, and confirm quantities.
AI speeds up sales and operational planning (S&OP)
Think about your existing supply chain — how long did it take to actually execute it? Most companies take over a year between planning and execution because that’s how long it takes to interpret data, predict disruptions and plan mitigations, understand the industry and potential risks, and much more. AI cuts the notoriously long time with integrated business planning (IBP) applications that can use advanced analytics to solve all these issues almost instantaneously.
By using AI to generate low-touch planning, it can help analyze data at scale, identify anomalies, detect patterns of disruption, and suggest solutions. In fact, KPMG’s report states that this low-touch planning improves Return on Equity (ROE) by two to four percentage points.
AI enhances visibility across the supply chain
Imagine all the locations, people, processes, and evolutions your product goes through in the supply chain. Meaning? You can’t possibly have eyes on everything going on at once. At least, that’s the case for about 43% of organizations who don’t have full visibility of their supply chain’s performance. AI control towers centralizes data from all these sources for better transparency within a supply chain.
As AI adoption increases, however, it’s important to implement protocols on data governance and quality.
“Data hygiene is essential to all AI initiatives. It’s got to be clean, trusted, secure, accurate, and reliable. A lot of times, organizations, including CPGs, underestimate the amount of time, effort, and involvement for that.” — Kayla Broussard, U.S. CTO of retail for Kyndryl
Low-code platforms power automation
Automation might be the key to reduced labor costs and improved efficiency — something you can do across many supply chain tasks. Low-code platforms help companies improve and adapt their products to any disruption, like new strategies or world events. The best part? Your supply chain staff doesn’t need to know how to code to use them, which is why two-thirds of organizations already implemented them in their supply chains.
Read the full report from KPMG here.
