Artificial Intelligence, or AI, is fast becoming an essential component of supply chains looking to gain an edge over their competitors. Many different types of AI technology are available, but all work to improve efficiency and reduce the risk of human error. Here, we will be outlining how AI is currently being used in supply chains and the benefits of adopting the technology.
How is AI currently being used in supply chains?
Extracting important data from customers, suppliers and documents
Many administrative tasks within the supply chain are time-consuming and can keep employees away from more complex tasks. By allowing AI to take over these tasks, workers’ time can be used more productively, which improves the efficiency of the entire operation.
Streamline supply, demand, and inventory management.
AI is especially useful for inventory management because it can automatically track the stock coming in and out of the warehouse in real time. Order processing, picking and packing are all time-consuming tasks with a high risk of human error. Using AI for these tasks prevents both overstocking and understocking.
Forecast demand before products are needed
AI systems use intelligent algorithms and historical data to predict customer trends and forecast demands before they happen, giving supply chains more time to prepare, rather than playing catch up in reaction to a new trend.
Optimize warehouse management, efficiency and logistics
Similar to administrative tasks, there are many warehouse management tasks that can be handled by AI systems, freeing up workers to perform more complex tasks. AI can also be used to improve the efficiency of the warehouse operation by working out shorter walking routes and better inventory positioning. Moreover, AI robotics can assist in loading or unloading pallets and moving cargo around the warehouse.
The benefits of AI in supply chains
Smarter planning and efficient warehouse management also result in a safer environment for employees. AI systems can analyse safety data in line with the latest safety regulations to identify risks before accidents happen. AI Robotics can also take over heavy lifting tasks that are more likely to result in injury to a worker.
Better customer service
As a result of improved logistics, accurate stock management and demand prediction, the customer is far more likely to receive the right orders in a timely manner, which directly results in a more positive experience.
Reduced operational costs
AI systems can operate error-free for a longer period than humans, meaning employees don’t have to work longer shifts doing simple tasks that can be completed out of hours by AI systems. This also reduces the risk of errors that will require a financial investment to rectify.
Ability to predict industry trends
As mentioned earlier, AI’s ability to identify patterns in data means that it has the potential to predict customer trends before they happen, meaning OEMs and CEMs can get a head start on their competitors by preparing for these demands, rather than having to wait for stock in reaction to the market changing.
AI systems reduce the dependency on manual labour for many of the warehouse processes, which means these processes become more streamlined. This removes operational bottlenecks and makes it less likely deliveries will be susceptible to hold-ups, resulting in more frequent on-time deliveries.
AI is already being put to great use in supply chains and we will only see further implementation of the technology in the future. Businesses that want to get ahead of their competitors and improve their overall operational efficiency need to be investing in this area to give themselves the best chance at success.
Are you looking for ways to improve the efficiency of your supply chain? You are welcome to get in touch with our team to see how we could assist you.