AI's presence in the supply chain industry is not new, but the emergence of ChatGPT is expanding its role and impact. At a recent conference, companies heavily emphasized their AI capabilities, with ChatGPT being a focal point of discussion. The consulting firm KPMG described generative AI as a form of AI that can create original content by building on patterns found in existing text, audio files, images, and software.
While most supply chain software providers offer similar foundational functions, it's the last few percentage points of differentiation that can make a significant impact. Generative AI, combined with existing AI capabilities, is becoming a key battleground for these providers.
IBM showcased its generative AI capabilities within its supply chain business, demonstrating how it can track parts shortages and provide an integrated view for decision-making. LevaData, another supply chain software provider, introduced its generative AI capabilities for materials sourcing. Overhaul, in partnership with Microsoft, unveiled a generative AI solution called RiskGPT, which aims to identify risks in supply chain operations.
The introduction of generative AI brings consistency and systemization to addressing supply chain risks. It also holds potential for training on compliance issues, eliminating subjectivity and streamlining decision-making processes.
AI and machine learning have applications beyond generative AI. They can enhance expertise, automate mundane tasks, and enable professionals to focus on strategic activities. Additionally, AI can facilitate the integration of environmental, social, and governance (ESG) principles into decision-making processes, enabling companies to assess the alignment of potential partners with their criteria and values.
Despite technological advancements, there are still challenges to overcome. Locus, a dispatch management platform, uses AI and machine learning internally to optimize delivery operations. However, widespread adoption in on-the-ground operations may take time due to factors such as change management.
In conclusion, the supply chain industry is witnessing the expansion of AI's role, particularly with the introduction of generative AI capabilities like ChatGPT. Differentiation in the market now hinges on these advanced AI functionalities, which have the potential to revolutionize decision-making, risk management, and sustainability practices.
