Johannesburg, 02 Sep 2019
Artificial intelligence is one of eight top strategic technology trends that can potentially and significantly disrupt existing supply chain operating models, as identified by Gartner.
Glen Riffel, Supply Chain Executive at Altron Bytes Managed Solutions, agrees. He says: “Artificial intelligence (AI) will change the way forward as to how we think about our supply chain and its efficiency. Today’s supply chain complexities demand additional support, creativity and – more importantly – the ability to accommodate our ill-prepared workforce and developing economy.”
He explains: “We don’t have the luxury of time when it comes to automation; we have to implement it now, we can’t wait for people to be upskilled, for instance, because then we’ll lag behind our competitors.”
When implementing AI, local businesses tend to want to implement the same capabilities that they see in first-world markets. However, cautions Riffel, there’s a need to be responsible and take into account a workforce that may not be ready for AI, as well as the country’s developing economy. “The typical supply chain encompasses a diverse workforce with different skills levels, ranging from general workers to accountants and MBAs. The solution has to be relevant to all levels, it must be simple to operate yet offer complex capabilities.”
While introducing AI in your supply chain will streamline and eradicate mundane day-to-day tasks, the real leverage lies in automating data collection, which enables quicker and better business decisions to be made. AI collects information from sensors on the various pieces of equipment and combines this with maintenance records. The resulting data is analysed to predict the best time to repair the equipment, which in turn assists the business to plan proactively to ensure the right spare parts are available in the required locations when needed.
“The company can do forecasting, planning and procurement against that data. The resulting intelligence impacts both warehousing and logistics, allowing the business to better plan usage, repairs or supply against a particular demand, specific to that geographical region.”
Future supply chains will necessitate the use of AI and integrate even more data collection. Without taking advantage of the latest technology, supply chains will become inefficient and unable to compete. With higher end-user expectations, and demands throughout the supply chain for faster turnarounds, industry requires the improvements AI can supply.
“Employing AI across the supply chain makes people’s jobs easier, it enables them to make better decisions quicker, and it removes more mundane tasks from the day-to-day business,” says Riffel.
Smart warehouses and autonomous moving vehicles
The most familiar AI examples in industrial settings are warehouse robots that automatically pull products from shelves for shipping. An example would be pharmacies in hospitals, where robots are used to pull prescriptions from the shelves.
Riffel says: “This use of AI can protect warehouse workers from dangerous tasks such as operating at heights or driving forklifts, while at the same time improving accuracy and safety.”
With AI, you can control multiple pieces of equipment stored in vertical storage units in your facility from a single panel, which lessens the need for numerous low-skilled workers. It also means you can use the full height of the warehouse to store stock, as well as assisting with inventory management. Predictive modelling uses AI to examine customer trends, identifying which products to stock and where to keep them in the warehouse. Predictive modelling can also assist in reducing forecasting errors and revenue losses from not having the right products immediately available – or too many of the wrong thing.
“There are too many variables at play for humans to accurately predict the appropriate inventory levels in real-time. We need a higher level of thinking. AI can solve these inaccuracies, making your facility more efficient.”
Autonomous moving vehicles were introduced more than 10 years ago in Europe to replace manually operated forklifts in large warehouses.
However, adds Riffel: “I think we would all agree that embracing this type of technology, unless used to protect employees and improve their safety, cannot be condoned in our local environment, where we’re looking at an unemployment rate of over 27%. While we certainly need to harness the technology that is beneficial for business, we also have a responsibility towards growing the capabilities of our workforce. So we need to implement the technology in a way that is compatible with our unique environment.”
Another way in which to improve supply chain efficiency is to ensure constant communication with your suppliers. Artificial intelligence allows for synchronisation throughout the supply chain, which will help the warehouse to prepare to receive shipments at a given time. Shared information about predicted downstream customer demand will allow suppliers to improve their delivery lead-times. By sharing information, all parties can plan accordingly.
He concludes: “We know where we want to be; AI provides another way of getting there, quicker and at less cost. We can adopt the same technologies as the rest of the world, but we need to be responsible in how we do so and consider our unique environment when implementing any new technology, but particularly automation. In my opinion, this is a board imperative, and not just an HR issue.”
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