In recent years, supply chains have become increasingly complex and, as a consequence, produced more data for companies to interpret. That need for additional interpretation - so firms can make the most informed decisions about everything from partners to purchasing - comes with a cost. It may take even a highly qualified person dozens of additional hours to figure out what all that extra information means, whereas it would take a software program based around artificial intelligence mere seconds.
For that reason, AI has increasingly become a critical weapon in the arsenal of many companies at various steps of the supply chain, including industry titans like pharmaceutical giant Merck, according to CIO. Simply put, companies of all sizes have a financial incentive to improve the efficiency of their supply chains, and for larger firms in particular, the areas for investment - when taken correctly - can lead to notable improvements in the bottom line.
Positive and negative data
Data itself is a simple statement of fact; in some cases, those facts can be great for a business while in others, it can highlight a serious issue, according to Transforming Data with Intelligence.
Consequently, the more companies can do to make sure they cultivate and collect data on an ongoing basis, the better off they will be as it relates to seeing where they stand, and potentially identifying trends before they even arrive.
Just like anything else, there are ripples caused by any change in a supply chain, the report said. If one logistics firm three steps away in the supply chain has a two-day delay in its operations, that will be felt - potentially with magnified impact - at every additional step. Being able to see such an issue arising - thanks to AI - gives partner companies the ability to react with greater agility.
Working hand in hand
Because AI is increasingly common, it's also vital that companies do more to make sure they collect as much data as possible through devices connected to the internet of things, according to Business Insider. Global spending on AI is already surging, but for many businesses, that expenditure should be accompanied by a solid investment in IoT tech to ensure the full value of both is realized. Of course, many firms see that value proposition as one worth pursuing in the years ahead; while global IoT spending is expected to hit a little less than $250 billion this year, it should rise to as much as $450 billion by 2023.
Any supply chain participants that have not made at least some investment in these tech options within that time frame may find themselves falling behind the competition in short order.