Purpose-built, AI-driven data solutions that deliver quick value and scale easily are already available to manufacturing. The key to fast time to value is to identify proven accurate AI solutions that have been built for the intended purpose and have access to a large amount of clean data so that the AI can leverage patterns and trends to deliver valuable insights and continue to learn. Many industries are using these tools, so why shouldn’t all supply chain executives facing mounting challenges in planning for and delivering goods use them?
Here are the ways technology and AI can help you get wins right away as you build the foundation for your digital transformation:
Controlling costs requires everything from smooth negotiating with shippers and suppliers to avoiding costly delays that result in manufacturing bottlenecks. The manual processes that dominate much of supply chain management are time-consuming, prone to human error, and vulnerable to version-control issues. In addition, such tasks as transferring information to supply chain partners with spreadsheets or PDFs makes it difficult to keep information secure, up-to-date, and consistent across parties.
While the primary way to avoid costly shipping delays with manual processes is to spend extra time on each order, checking and rechecking addresses, quantities, and deliverables, that means less time is available for other tasks.
When integrated into the manufacturing process, advanced supply chains become a strategic partner for manufacturing.
Transitioning to platform-based automation systems eliminates many of these tedious tasks, reducing errors, increasing security, accelerating processes, and ensuring consistency across products. Comprehensive platforms create transparency within an organization and enable better external supply chain visibility. From the internal perspective, increasing production efficiency and accuracy means fewer errors and less waste. This can lessen the burden on the supply chain function and lowers costs by reducing the amount of spare parts and material needed. Externally, advanced platforms help link disparate data sources and partners across the ecosystem to help identify and rectify delays as they emerge. Digital tools can feed into more robust and accurate processes and mitigation strategies.
Creating reports for regulatory audits or root cause analysis after an issue has occurred are egregiously complex and time-consuming activities when manual systems are in place. Automating these functions can exponentially increase the speed and accuracy of reporting and enable supply chain teams to focus on tasks that bring higher business value.
Advanced supply chain technologies help get the right components, materials, and products to manufacturing more quickly, and with more insights—helping manage downtime and reducing waste. Data-driven insights can identify where issues are occurring and suggest how to fix them. Internal best practices can then be used to drive external improvements across to supplies, shippers, manufacturers, customers, and even regulatory bodies.
When integrated into the manufacturing process, advanced supply chains become a strategic partner for manufacturing. The relationship between supply and build goes from a unidirectional flow of inputs into a process, to a multi-faceted interplay that results in both functions gaining efficiency, actionable insights and lower costs.
For example, advanced insights from the supply chain can automatically update production schedules to help avert bottlenecks and set realistic customer expectations. And, conversely, manufacturing insights can provide the supply chain with the optimal timing and quantities of a given input.
And then there’s security: Security infringements (physical and cyber) can cost an organization time, materials and reputation. Advanced data-based solutions built on AI analytics and machine learning predictive features can help secure shipments and alert relevant parties to any anomalies before they become bigger issues.
Price, quality, customization, customer experience, and convenience all play growing roles for an organization in an increasingly competitive global market.
You and your team can contribute to better product excellence directly by helping source higher quality inputs, replenishing materials in a timely fashion, optimizing machine and process performance and indirectly by helping save costs in other aspects of the business—money that can then be used to upgrade products and processes. Digital tools can provide you with the insights to achieve this and to build the relationships that lead to preferred buyer status, preferential cost structures, and intelligence on when new resources become available before the competition.
To help further, advanced technologies can automate shipments of materials that change little in price or quality, freeing up time for more complex, expensive or customized orders. AI/ML tools can also alert your team to changes in pricing and timing and ensure shipments coincide with manufacturing schedules and warehouse availability.
To fully execute these advantages, the supply chain mastermind also needs accurate, actionable insights on what is driving input needs from other parts of the organization, such as manufacturing downtime and production optimization programs. A data-driven interaction of insights between teams helps ensure that inputs are optimizing—and not hindering—production, efficiency and sustainability goals within departments, across the organization and out into the supply chain.
ESG isn’t just good PR anymore; it’s a strategic imperative. So, the importance of supply chain strategy in meeting your organization’s ESG goals has increased.
The manufacturing industry is also increasingly looking at its social license to operate (LTO), which goes beyond meeting legal personnel requirements to ensuring human welfare for employees, customers, and neighboring communities.
ESG and LTO are particularly important for the workforces of tomorrow. Millennials will comprise 75% of the workforce by 20301. Strong ESG programs create a “best place to work” atmosphere and reflect the values younger generations want in their employers.
1 The (Millennial) Workplace of the Future Is Almost Here — These 3 Things Are About to Change Big Time | Inc.com
But public pressure and expanding regulations on environmental and social concerns extend beyond a business’s four walls to include the suppliers, shippers, and customers in its value chain.
Supply chain management orchestration can allow a holistic approach to transparency, including profitability, fulfillment cost and capacity, inventory risk, customer service, and sustainability outcomes from organizational and supply chain network inventory sources. Data, analytics, and AI can help optimize these goals simultaneously and provide a better understanding of product lifecycles, materials origin, and energy consumption. This can help you better gauge a product’s direct environmental impact to optimize inventory levels and asset use, resulting in a more environmentally effective organization and supply chain. Working with production to drive out losses of raw materials due to downtime or quality issues also has a compounding effect on an organization’s sustainability goals that can reverberate across the entire supply chain. You can become a pivotal source of generating and tracking data such as greenhouse gas emissions (GHG, for Scope 3 compliance) and ensuring the entities your organization does business with follow the proper social license to operate (LTO).
Also, upcoming environmental legislation targeting the supply chain (such as Scope 3 carbon emissions; the forthcoming German Supply Chain Due Diligence Act; and the U.S. SEC’s proposed carbon reporting) make it critical that you understand and implement advanced technology for carbon and related reporting.
Data beyond the organization, such as economic and consumer trends, weather patterns, demand forecasts, and supply constraints, can be used to optimize resource usage.
Those Millennials entering the workforce want to do meaningful, fulfilling work. Automation can eliminate mundane tasks and create exciting environments that compete with tech and other attractive industries. This will allow your supply chain team to attract, train, upskill, engage, and retain a versatile workforce with virtual/augmented reality and gamification.
You’ll be able to “future-proof” your workforce by constantly identifying new functions, technologies, skills, and opportunities to create an evolving supply chain career roadmap. By partnering with and bringing in best practices from other businesses, industries, and academia, you can foster an environment of innovation and achieve thought-leadership status in supply chain career mapping. As the mastermind, you also enable your internal teams to be more masterful and productive: being an integral and integrated partner with internal production and reliability teams empowers employees to fully own the supply chain and beyond, contributing directly to the entire value chain of the organization.