Today, more than ever, it is necessary to focus efforts on incorporating all the tools that help prepare supply chains to face any disruption, as AI does with its predictive power, which offers amazing results.
In supply chains, artificial intelligence (AI) revolutionizes its operation by predicting possible scenarios and generating key information to obtain optimal operation, which allows the company to meet current consumption needs. Import and export businesses can completely embrace AI to improve their supply chain operations. Randall Castillo Ortega, an expert in importing and exporting, explains the role AI plays in the industry and why itÂ’s important.
To explain how this cutting-edge technology is used in this sector, we should first consider that it is not easy to manage a supply chain. We can even say that it can be difficult, because the objectives collide and the variables change, which implies that the chain must evolve to be more collaborative and less individual. Also, it must be recognized that supply chains are accustomed to working in traditional logistics schemes, which are characterized by being talkative and inflexible. However, by integrating AI, it is possible to predict less stable and highly volatile order patterns of customers, which is a challenge for any supply chain.
In addition, it goes further in predictions to obtain better returns by harnessing the power of internal and external causal data, such as Gross Domestic Product (GDP), the Consumer Price Index (CPI), the exchange rate, trade agreements and industrial production, among others. “This allows for greater accuracy in the scenarios resulting from these predictions, which translates into complete and detailed reports that guide good decision-making,” asserts Castillo.
As if that were not enough, AI can be used to anticipate market changes and demand drivers, bringing better sensory capabilities to the supply chain, product portfolio, capital expenditure decisions, and long-term strategic and capacity planning. In shipping, this technology can examine key data such as order types, delivery times, quantities, locations and modes of transport, to identify the root causes of returns and predict points of failure. While the rigidity of traditional supply chains fades with some of the human qualities of AI, it is able to infer, learn, solve, reason and understand language, to detect the problems that are going to be addressed and then make a demand forecast at a granular level in order to make sound decisions.
These predictive advantages offered by AI, have not only consolidated this technology as a driver of the digital transformation of companies, but it is also considered by 58% of business leaders in the region as a tool that could revolutionize their businesses, according to a study, “Artificial intelligence in Latin American companies.”
Additionally, in the Global Retail Supply Chain Study, conducted by LLamasoft in conjunction with RSR Research, 73% of retailers in the world believe that AI and Machine Learning can add significant value to their demand forecasting processes, demonstrating that the effects of AI on supply chains are well known. With the power to predict, it is not surprising that leaders make the best decisions, which have resulted in strengthened supply chains, with advanced visibility into their potential problems, diversifying their suppliers and with the ability to adapt to new market needs caused by disruptions. “Today, more than ever, it is necessary to focus efforts on incorporating all the tools that help prepare supply chains to face any disruption, as AI does with its predictive power, which offers amazing results,” concludes Castillo.
About Randall Castillo OrtegaÂ
Randall Castillo Ortega has been involved in the financial space virtually his entire professional career. In addition to having founded the financial lending firm RACO, he is also an avid outdoorsman and, along with his family, is a huge community supporter. Â He regularly participates in community ceremonies and events organized to drive a better environment for children and families.