Stanton Chase uses cookies to ensure you get the best experience on our website. Learn More
I disagree | I accept

How A.I. Can Help the Supply Chain Through the Crisis

May 2020
George Sphiktos
Share LinkedIn Share E-mail
How A.I. Can Help the Supply Chain Through the Crisis Cover Image

As businesses look toward recovery, Industry 4.0 offers promise of security

As companies and industries scramble to plan for business in a post-pandemic world, artificial intelligence is being increasingly utilized as a means to further interconnectedness throughout the supply chain. From driving demand and streamlining distribution to reducing costs and freeing up time for humans, A.I. has the potential to not only help the business world get back on its feet but to highlight ways that we can avoid future crises in manufacturing – or, at least, encourage a faster recovery across hard-hit industries.

The COVID-19 lockdowns have underscored the importance these systems play in our lives — from the beginning of the supply chain all the way to the end consumer. If we can better understand what that future looks like, we will be more prepared to harness this intelligence for business, for good, and for progress.

Manufacturing

Each sector of the supply chain is already wrapped up in A.I. Across manufacturing sectors, costs are being reduced, maintenance is being performed faster, and predictions are preventing downtime. At the same time, quality is rising, humans and robots are collaborating, and products are easily more individualized to cater to consumer preferences. These are all a result of A.I. and a part of Industry 4.0, reflecting the way products are provided today putting digitization to use in manufacturing.

CIO Magazine from IDG Communications confirmed that A.I. will play a significant role moving forward: “The manufacturing sector is a perfect fit for the application of artificial intelligence. Even though the Industry 4.0 revolution is still in its early stages… A.I. is destined to change the way we manufacture products and process materials forever.”

In an early April article titled “The Rise of the AI-Powered Company in the Post-Crisis World,” Boston Consulting Group wrote that “AI will help companies detect new consumer patterns and deliver ‘hyperpersonalized’ products to online consumers,” citing historical examples of companies that were able to successfully increase both profit margins and sales growth in global economic downturns.

Distribution

While A.I. may never fully replace workers, it can guide decisions, enable more accurate financial predictions, and ensure timing is appropriately considered. In a world defined by time delays, unforeseen events, human error, and an overkill of data that is often not always relevant, it is crucial these aspects of distribution move smoothly from start to finish.

“Many different businesses — including distributors — can benefit from AI, and that the technology becomes more effective and more accurate when fueled with more data,” the National Association of Wholesaler-Distributors wrote in July 2019, and this is even more true today.

Marketing information companies like Nielsen have been using A.I. to create connected information systems that would bring together almost an infinite number of data points from manufacturers, retailers, and consumer sales to identify and predict supply-chain trends, opportunities, and challenges.

Around the world, the distribution of products to consumers will continue to change, taking on new shapes as more and more A.I. technologies emerge. Use of A.I. in sectors like manufacturing can make both business and life easier for the distributor and the consumer — especially in challenging times.

Consumers

Amazon, Netflix, eBay, Fortnite: As consumers become more aware of the multitude of options available to them, these leading brands are using A.I. to drive demand and disrupt traditional business-to-consumer (B2C) markets. But the clock is ticking.

“Time is of the essence,” NAW notes. “Distributors currently have a big leg up on would-be disruptors in the form of information and time. A.I. runs on momentum, and in the A.I. world more data points mean better customer experiences, which means more data points. Right now, distributors have an information advantage.”

COVID-19 has created even more pressures and, as Scott McKenzie, Nielsen’s Global Intelligence Leader, stated recently, “There is an even greater demand now for faster, more frequently updated data.” This allows us to be more agile and responsive to the new conditions we are all facing.

This data-focused approach is crucial to staying ahead of fast-moving trends and savvy consumers while understanding the potential concerns and challenges. A leading requirement of this is the ability to filter through tons of data and focus on what is truly relevant in order to make an impact. This is where A.I. plays a crucial role – and will get even better with time as a result of improved algorithms – in achieving unprecedented efficiencies and allowing real-time supply chain responsiveness. These new efficiencies can free up time for humans, allowing them to focus on creativity, which A.I. cannot do in the same way. It is in this respect that A.I. brings a real benefit to humans.

As we continue to see artificial intelligence alter systems and models across the global supply chain, “the focus shifts to recovery,” writes BCG. It is during this transition that “more companies are likely to deploy A.I.-enabled solutions to reignite topline growth.” At every step of the process, Stanton Chase is partnering with companies who need top-tier leaders.

About the Author:

George Sphiktos is Director at the Stanton Chase office in Washington, D.C., with a focus on A.I. and Analytics. Over the past 35 years he has traveled, worked, and serviced clients in more than 50 countries. He considers himself a global citizen, fortunate to have first-hand experience with so many logistical and supply chain challenges and changes over the years.

George has a longstanding passion for artificial intelligence, honed during his 34 years at Nielsen.

For more about how to find leaders well-versed in preparing for intelligent transformations, or for other A.I.-related questions, he can be reached at g.sphiktos@stantonchase.com.

Contact a Stanton Chase office near you

Find an office