The Autonomous Supply Chain, Powered By AI, IoT, and Blockchain
By Jeff Eckel, Product Marketing-Retail & Supply Chain Solutions of OpenText
Few trends receive the level of hype lavished upon AI, IoT and blockchain. To a casual observer, it may seem as though every company wants to position themselves as a leader in these technologies, but real-world use cases are proving more difficult to find.
It’s clear there is potential in these technologies independently, but the real power will come as new ways for them to work together are developed. The applications for these technologies will evolve as we continue to invest in innovation, but as businesses look for ways to use it today, a compelling scenario is developing in the world’s supply chains.
In 2020, the usefulness of AI, IoT and blockchain technologies in the supply chain will move beyond hype and we should witness a surge in use cases across small and large-scale applications and a wide range of industries within both the public and private sector.
Companies are already exploring blockchain-related use cases or implementing AI- and IoT-based environments across their business operations. For example, a combined approach featuring AI, IoT and blockchain could help in logistics and foodservice. A shipment of frozen food could be shipped and the consignment details, including purchase order number, carriers used and last mile distributors could all be written to a blockchain, providing end-to-end traceability. IoT sensors for temperature, humidity and GPS could all be included to help track the shipment’s progress and if a product arrives at its destination spoiled, it would be easier to determine what went wrong and at what point in the journey. AI systems can be layered in, learning from this information to provide added intelligence and recommendations to minimize disruptions in supply.
The word autonomous has been associated with the automotive industry for a few years now however it is starting to find its way into the supply chain as well. The supply chain has been impacted by numerous disruptive technologies in recent years, AI, IoT, wearable devices, drones and now blockchain.
Many companies will be leveraging all three of these technologies and not realizing that they are in effect enabling their own autonomous supply chain. These technologies can bring immense value to a business, however to maximize the return on the investment of these technologies it is important to have a digital foundation or digital supply chain in place. You have to walk before you can run and no matter how appealing some of these technologies are, if you cannot exchange information electronically with an external digital ecosystem then it is going to be difficult to obtain maximum ROI from these technologies.
Digital Business Ecosystems – It is critical to ensure that information being exchanged across a trading partner community is in electronic format. Companies struggle to ensure that 100% of trading partners are exchanging information electronically, however this can be achieved by connecting all trading partners, irrespective of size or technical capability, to the same business network. This helps to ensure that B2B transactions are being exchanged seamlessly and more importantly this information can be leveraged in downstream analytics or AI platforms. Establishing the digital backbone or digital foundation should be job number one for any digital transformation project.
Internet of Things – IoT sensor information can be leveraged to not only identify where a shipment is, anywhere across a global supply chain, but also monitor its condition, for example measuring temperature and humidity. IoT stands to transform many supply chain processes, from improving replenishment processes through to improving the uptime and availability of serviceable assets such as commercial vehicle fleets and production line equipment such as robots.
Artificial Intelligence – Deriving insights relating to supply chain performance is a key goal for many companies. Leveraging analytics to determine the best performing trading partner or understand how many purchase orders have been processed within a specific time frame will help companies to optimize and improve their supply chain operations. But what if you could feed IoT sensor information in to an AI platform to help take decision making to the next level? Taking sensor data from a digital twin of a physical product and feeding into an AI platform will help to determine the ‘likely’ future operational performance of the product.
Blockchain – Blockchain offers some unique capabilities, the main one being a tamper-proof record of information, which could include a mix of B2B transaction information and IoT sensor data. Companies are starting to explore this technology across their supply chain operations, albeit on relatively small proof of concepts. Most use cases for blockchain relate to supply chain track and trace or knowing the provenance of where for example raw minerals were sourced from and which final products they ended up in.
The greater convergence of these technologies will allow organizations to leverage new performance insights to refine business processes. For supply chains, this means improved traceability of goods and the ability to record and secure an archive of all digital interactions between companies and trading partners.
Internet of Things sensors can be used to improve supply chain visibility and improve equipment uptime with predictive maintenance applications. They can also be integrated with other technologies to assist with automatic replenishment processes. In supply chains, blockchain can be used independently to track high-value goods, manage end-to-end recalls, and provide traceability to industries such as food and beverage, or pharmaceuticals and life sciences. Combining much of the data from these technologies, AI can be used to refine inventory management and improve forecasting. On a deeper level, AI can also use the data it receives from supply chain trading partners to monitor their performance and responsiveness to customer demands.
The level of excitement coming from both industry and academia for these technologies has been palpable, and 2020 should continue that trend. However, 2020 should set itself apart as the year more real-world cases began to demonstrate the true power of a converged solution in supply chains.