IBM touts AI cure to secure supply woes

While enterprises around the world reel from supply chain shortages as a result of the ongoing COVID-19 pandemic, IBM says artificial intelligence (AI) has the potential to help solve challenges now and prevent disruptions like this in the future.

“Even the smallest upset can create a dramatic and resonating effect on the global supply network,” wrote Jonathan Wright, cognitive process re-engineering team lead at IBM, in a blog post. “No company can afford not to have a multi-dimensional, dynamic supply strategy that is capable of responding to disruption.”

And COVID-19 has, without question, turned the industry on its head and given it a hard shake. This week Gartner weighed in on reports that the semiconductor market would contract in 2020 as a result of the virus, predicting it would decline 0.9%. Semiconductor shortages are expected to have ripple effects on related industries including the server and storage markets, which research firm IDC predicts will decline 3.5% and 5.5%, respectively, this year.

Using AI, IBM claims enterprises can not only make the best of a bad situation but help them respond faster to disruptions and uncertainty in the future.

“Most supply chain leaders are still in the reactive phase of how to deal with this pandemic,” Wright wrote. “Using AI, organizations can turn unstructured real-time data into insights that help predict disruptions and vulnerabilities, providing near-term visibility.”

AI can even pull insights from weather forecasts and social media to give advanced warning of potential problems before they happen. And these predictions can help enterprises diversify their supply chains and mitigate risk.

These insights also open the door to more efficient operations and lower costs by informing things like inventory allocations and prioritization. “Using analytics, AI and visualization tools, it’s possible to model and then built flexibility and optionality into structural supply chains,” Wright wrote.

IBM says it is already working with a client in Europe to develop a heat map of the company’s suppliers to better understand the effect COVID-19 may have and enable them to source components from alternative suppliers.

Meanwhile, Wright suggests data-sharing platforms — like those offered by IBM — can help strategic partners to understand how disruptions to one company’s supply may impact the others. “No one can predict the future, but we can be much smarter and strengthen the global supply chain by leveraging the power of AI.”

―SDX Central