Building an AI-Driven Supply Chain: Why Data Matters

The advent of Generative Artificial Intelligence (GenAI) is pushing companies to rethink their supply chains, with organizations in the Asia-Pacific especially, striving to pivot quickly. Investments in AI and genAI are estimated to reach USD110 billion by 2028, according to IDC. The research firm predicts that 60% of Asia’s top 2,000 companies will adopt GenAI tools by 2026 to overhaul their core supply chain processes and reduce operating costs by 5%.

The eagerness to adopt and scale AI-driven solutions is often hindered by inadequate data infrastructure. This hinders successful AI adoption due to a lack of flexibility in accessing and managing structured and unstructured data sets, across multi- and hybrid cloud environments. Without the right infrastructure, scaling genAI projects remains a challenge, with only 30% or fewer organizations able to move their pilot projects into full production, according to findings by Deloitte.

Data is the key to AI adoption

ERP systems provide a robust framework for data management, process optimization, and decision-making — these are critical to AI’s successful deployment. And to navigate or optimally utilize ERP systems, a key issue to tackle is data quality according to PwC.

While minor problems like inaccuracies in the data can be resolved rather easily, data latency is a persistent challenge, particularly when it comes to supply chain partners. PwC found in their survey that 26% of businesses reported difficulties in realizing a return on investment from multiple digitalization efforts due to data challenges. This highlights the risks AI projects face when data quality and accessibility are overlooked.

Fortunately, there’s a strong appetite for AI-driven transformation in the Asia-Pacific region. IDC finds that 80% of supply chain organizations in the Asia-Pacific are willing to accelerate digital transformation via AI. By proactively addressing data challenges and increasing investments in data lifecycle management, organizations can unlock the full potential of AI and drive significant business value.

Multi-pronged benefits

On a foundation of good data quality, AI-infused ERP systems can perform efficiently on multiple levels. From automating routine tasks to performing advanced data analysis, and providing real-time insights, these systems are the mark of the future.

With great quality data, AI-infused ERP systems can be beneficial to process optimization as they boost operational efficiency and raise agility in the face of market changes. They also empower employee productivity via the automation of repetitive tasks, which frees up the human workforce for more high-value and creative tasks.

Additionally, these systems allow the organization to leverage advanced analytics on the available data to enhance decision-making and reduce human errors. AI-driven systems provide higher levels of security as they can detect and mitigate potential threats quicker and more accurately than their human counterparts would.

These are key features of a robust AI-powered ERP system; positioning the organization to automate tasks and enabling systems to think, learn, and make data-driven decisions. It democratizes access to valuable insights. Supply chain managers should also seek out an ERP system that offers an integrated suite of AI and business intelligence capabilities for various use cases. This level of dynamism delivers tailored insights that elevate efficiency.

Redefining future possibilities

Armed with these capabilities, the future of make, move, and sell is set for a future where ERP systems understand what workers need to know and how to adapt that knowledge directly to employee workflows.

Users then get the immediate insights they need to do their jobs better. In making this transformation, the script is flipped — with workers put front and center of the intelligence ecosystem, enabling machines to work with them and not against them.

Through real-time, end-to-end visibility, the mutually beneficial relationship of AI and ERP will expand the possibilities of what's possible for industrial operations. Not only will it improve existing processes, rather it will also create a new vision of what is possible — leading to smarter, more resilient supply chain operations.

The views and opinions expressed in this article are those of the author and do not necessarily reflect those of CDOTrends. Image credit: iStockphoto/Andrii Yalanskyi