6 Ways Supply Chain & Procurement can Benefit from Generative AI

Generative AI tools can be used to improve search capacity, automate tasks, identify patterns, and make predictions that would otherwise be time-consuming. The result? Significant savings in time and money, as well as improved decision-making.

• Generative AI can help find information more quickly and easily by searching through large datasets and identifying patterns.
• It creates predictive models that can help professionals forecast demand, identify risks, and make better decisions.
• It helps supply chain professionals become more agile by automating tasks and providing insights for better decisions.

The following as some potential applications of generative AI for supply chain and procurement teams.

1. AI boosts the search ability of supply chain and procurement organizations

Instead of relying on limited data provided by traditional search engines or reports, generative AI can make the search more organized and interactive. Generative AI is different from web search keywords (traditional web search, web crawling, ranking, bids in paid search) or reports, which often require updates on a regular basis. It can answer questions about what, where, when, and why, and it can be customized to individual needs. This means that users can get more relevant information with more targeted prompts. Generative AI can also be used to track trends, gather market intelligence, determine pricing, calculate costs, benchmark performance, and find lists of distributors or suppliers.

2. AI reduces preparation time for reports, presentations, and even procurement RFPs

It can assist in generating the initial draft and quickly getting things started. In short, AI can improve productivity at the individual level. In the long term, AI could become more integrated and be offered as an embedded or add-on service.

3. AI provides predictive models

This application is based on dynamic data, where large datasets can be very complex and time-consuming to analyze. The range of applications includes network design in supply chain and logistics, lean inventory control, and dynamic demand forecasting.

4. AI also helps normalize human bias

In addition to predictive analytics, AI can be used for decision support with potential trends and forecasts. This means that buying organizations do not have to rely on the intuition of managers, market intelligence reports, or close-loop model calculations. AI can perform the computations based on historical data and potential scenarios and outcomes.

Also read: ChatGPT: What Procurement Leaders Need to Know and Do Right Now

5. AI drives supply chain agility by reducing supply chain costs and cycle times

It provides a set of recommended data and key attributes, policy and reward profile scenarios to assist managers. This includes finding the targeted cost per shipment and taking appropriate action to reduce the cost per unit, which has a direct impact on the P&L statement.

6. AI helps create a digital-first supply chain

Processes become more integrated, automated, and intelligent in ERP systems such as order management, inventory management, production planning, raw material ordering, and supplier inventory control.

Conclusion

Generative AI is a powerful tool that can be used to improve the supply chain and procurement professions. By using this technology, professionals can save time, improve their decision-making, and make their organizations more agile.

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