Supply Chain Management and Machine Learning: An Overview
Gone are the days when we used technology. Now, we live in technology. Machine learning is one such technology that is now being used in a wide variety of businesses. It is an application of Artificial Intelligence. It automates tasks and reduces human interference.
One of the industries where it is being most used is the supply chain management.
Machine learning increases productivity and makes optimization simpler throughout the supply chain. Once you discover new patterns in supply chain software development data, you can revolutionize any business.
Benefits of Machine Learning in Supply Chain Management
- Predictive analytics
- Automated quality inspections
- Optimizes supply chain
- Increase inbound shipment capabilities
- Enhances customer experience
Best Ways Machine Learning is Revolutionizing Supply Chain Management
1.) Collaborative Supply Chain Networks
Machine learning is providing a lot of amazing benefits in collaborative supply chain networks. It is now being used to spot horizontal collaboration synergies among multiple shipper networks.
The top three benefits are:
- Improved supplier delivery performance
- Reduced supplier risks
- Minimized freight costs
2.) Obtain Contextual Intelligence
Machine learning combined with other related technologies is being used to gain contextual intelligence across supply chain operations.
This gives the following benefits:
- Quick response time to customers
- Reduced operational costs
- Lower inventory cost
It also provides new insights into various aspects of supply chain management and improves warehouse management.
3.) Improved Demand Forecasting Accuracy
One of the major challenges faced in the supply chain management is predicting the future demands for production.
Initially, baseline statistical analytics techniques were used. Then, advanced simulation modeling.
And now, it’s the era of machine learning algorithms that are capable of analyzing large data sets quite fast, thus, improving the demand forecasting accuracy.
4.) Improved Supply Chain Management Performance
It provides insights for improving supply chain management performance. It combines the strength of supervised, unsupervised, and reinforcement learning to find the factors that affect the supply chain management performance the most.
5.) Improved Supplier Quality Management and Compliance
It helps in defining product hierarchies and streamlining track and trace reporting. It finds patterns in suppliers quality levels and then creates track and traces data for each supplier. Hence, it saves a lot of time for manufacturers.
6.) Improves Production Planning
Machine learning is now making it possible to manage and optimize multiple constraints more effectively. Manufacturers are using machine learning to reduce supply chain latency for components and parts used in heavily customized products. It is also improving factory scheduling accuracy.
7.) Improve Longevity
It is improving the supply chain equipment management such as the warehouse, transportation, engines, machines and so on. New patterns in the supply chain can be identified by implementing IoT and machine learning. Then you can measure the overall equipment effectiveness, which is an important factor for manufacturing industries.
8.) End-to-end Visibility
A few years back, in various industries, predicting the architecture in real-time with analytical tools was not possible.
Monitoring provides end-to-end visibility and now it is possible with machine learning.
Now, whether it is development dates, contract purchasing or any other requirement, everything is visible.
Visibility is important for long-term business.
Let’s Wrap it Up!
Machine learning is now being used by businesses in supply chain management to detect inefficiencies and add better control to processes. It is transforming the space in supply chain management. Managers just need to evaluate the areas in which this technology is most helpful. If you are taking your business towards digital transformation then machine learning is exactly what you need to increase operational efficiencies.
Also Read: AI and ERP Software Integration Is Valuable