The supply chain is the source of every part of production. From raw materials to manufacturing to distribution, each step requires the most secure transition possible. Sometimes, though, the supply chain can come with various risks that affect these stages. Security issues arise from these vulnerabilities, and merchandise can be damaged or stolen, leading to more headaches and time-consuming procedures. Artificial intelligence (AI), however, is working to improve that security.
Technology affects all parts of society, and the supply chain is no exception. AI offers a highly innovative form of technology that is changing the game for many supply chain officers and workplaces.
AI encompasses the knowledge that computers demonstrate — separate from human intelligence, but similar in process. Due to its exponentially growing market, experts consider AI as a disruptive innovation, changing the way society operates. It interrupts traditional practices and offers a better method of operation.
This integration is much needed within the supply chain. Global supply chains will find several uses for AI because of a growing lack of visibility — both within workplaces and during transportation. But what exactly are these issues?
Security Issues in the Supply Chain
The overarching theme that recurs across supply chains is visibility. This issue means that managers tend to lack full control or knowledge of every operation occurring throughout the chain. For example, manufacturing supervisors might not know from where their suppliers are getting their raw materials. And in certain circumstances, businesses may not have all the information on their suppliers. Surprisingly, 84% of information security officers say that lack of visibility is the biggest issue across the chain.
With a breakdown of communication and visibility, other issues start to arise. Supply and demand are growing every day as traditional commerce and e-commerce continue to increase. Subsequently, manufacturers need more suppliers, and suppliers need more raw materials. This matter complicates communication further.
A lack of communication will lead to security issues on any level. If managers don’t know what is coming in or going out, inventory miscalculations or even theft could occur. On a smaller scale, employees may encounter phishing emails or other scams. These situations entail scammers and hackers posing as supervisors asking for credentials and business information.
Counterfeits are another security issue within the supply chain. A counterfeit product could lead to complaints or investigations. Beyond that, though, counterfeit products have dangerous implications for those who may need them the most. If the Armed Forces or medical patients, for example, receive faulty products, the results could be grave.
These problems only mark the surface of the many outcomes a lack of security can cause within the supply chain. The effects then ripple outwards. But AI can improve these issues in numerous ways.
How AI Can Help
The AI realm is a powerful concept that uses big data for operations. The systems using this tech can swoop in and automate tasks that were once hassles for workers. Machine learning (ML) abilities within AI allow supply chain management platforms to run on their own, learning as they go. With these automated tasks, the number of security risks will decrease.
Some of the most significant areas of security concerns are surveillance, information sharing, inventory and communication. Accidents or theft can easily occur in these fields. However, with better communication and understanding of how each stage operates, the entire supply chain will be in tune.
AI provides that help with its available resources. Predictive data and data analysis, pattern recognition, real-time tracking and inventory management are examples of what’s within AI’s wheelhouse. Real-time monitoring will help with understanding where the products are, which prevents theft or counterfeits. Data analysis provides better insights into the supply chain’s logistics. Security officers can track quantities of supplier shipments and improve upon that bridge of communication between vendor and company.
An added benefit is AI’s automated nature. What used to take hours or even days now requires little to no time. For example, AI can optimize taking inventory. The dates and times that merchandise arrives and leaves will all be readily available for managers to see. Similarly, businesses can use data analytics to improve company decision-making as well as understand their supply chain.
When daily operations within the supply chain go unmanaged or unchecked, that’s when the system is the most vulnerable. Customers must be able to trust that each part of the system will run smoothly. AI technology can enable every member of the supply chain to bring this to fruition. Monitoring every part of the process through automation will improve security.
The Biggest Factors for AI Use in the Supply Chain
There are three factors within the supply chain that AI can improve upon:
- Customer satisfaction
- Employee treatment
- The company’s bottom line
Businesses, manufacturers and suppliers aim for customer satisfaction. Without it, the entire chain would cease to operate. Next, employee treatment is critical. As the backbone of what propels the supply chain forward, employee conditions must be optimal concerning their health and resources. And lastly, the bottom line is a driving factor for any company. It influences the way businesses make decisions and use AI.
AI is influential for these three factors — and at the root of it, so are the security risks it mitigates. AI can go above and beyond to predict consumer trends and behaviors. It can compile data in real time for business decisions. AI security is one of the primary tools that can ensure customer satisfaction, employee treatment and profits.
With a secure supply chain, employees can use AI to their advantage, improving their working environment. They can focus on necessary tasks instead of dealing with security responsibilities — like surveillance or inventory — that AI can handle.
Customer satisfaction and company revenue go hand-in-hand. As one increases, so does the other. If more companies use big data, customer satisfaction will increase, and subsequently, so will the bottom line. Luckily, AI is the best way to accomplish this.
Optimizing Supply Chains Through AI
Businesses will continue building upon AI’s current capabilities, and AI technology in the supply chain will continue to improve. Automation will keep undertaking bigger responsibilities and optimizing security measures for the entirety of the supply chain and beyond.