Cognitive Supply Chain- As complex algorithms, machine-learning and artificial intelligence become mainstream, it seems inevitable that they’ll disrupt global supply chains. Companies, whether they’re Maersk or GSK, Jaguar Land Rover or Tesco, increasingly need distribution and inventory management systems that are self-learning, predictive, adaptive and intelligent; so-called cognitive supply chains.
“We’re at a unique moment in the evolution of the supply chain where advanced technologies have matured enough to match the proliferation of data. There is a current transition among leading companies where they’re aggressively reinventing from the inside out,” explains Jesus Mantas, managing partner for global strategy at IBM Global Business Services.
“The typical supply chain in 2018 accessed 50 times more data than just five years earlier. There’s an increasing focus on supply chains to reduce costs across incredibly complex, global operations. However, less than a quarter of this data is being analysed in real time.”
Cognitive supply chains are able to sense in real time, understand implications and trade-offs; they’ll also drive competitive differentiation to the next level
Intelligent inventory management systems still few and far between
The fact is smart, fully digitalised supply lines and inventory management systems that think for themselves are still thin on the ground. Amazon’s anticipatory shipping technology, which calculates demand for items in specific locations and moves them around efficiently, is still a widely used example. Yet it’s not the norm.
“There is a huge appetite to develop cognitive supply chains, which is only set to increase as more success stories come to light. But for many, achieving a fully cognitive one is currently just a pipe dream because of poor quality data,” says Alex Saric, smart procurement expert at Ivalua.
The age-old issue of siloed, unrationalised-data legacy systems, as well as companies that don’t talk to each other, is widespread. And with deploying cognitive supply chains, there is still a risk of being a first adopter, at the same time as there’s the worry of being left behind, while the dread of potential failure can be an even bigger limiting factor.