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26 Jan 2023

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BCG Report Finds Companies Lack in Applying AI to Supply Chains

“The death of supply chain management is inevitable,” according to a new report about AI and its use in supply chains from BCG.

The Boston-based consultant says in this report that to make use all of AI's potential, “companies must think differently about how and where they apply AI. Instead of using it to analyze data and enhance visibility, they need to trust AI’s ability to continuously learn and make decisions that optimize performance.”

BCG analyzed supply-chain KPIs from 2011 and 2020, finding “insufficient progress in addressing fundamental supply-chain problems,” according to the report. Delivery performance actually declined independently of inventory and staffing levels during that period.

So, “to improve supply chain performance, many companies have ramped up their investments in digital technology,” the report states. “Yet we see little evidence that companies are considering AI use cases that enable autonomous decision making. In the absence of entirely new applications of AI, it is not surprising that the decades-old challenges of declining service levels, suboptimal inventories, and excessive manual effort persist.”

Image from BCG.

The full report can be found at BCG.

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