Noodle.ai and diginomica recently gathered for a chat about AI’s superpower ability to tamp down some of the stress involved in managing supply chains during the pandemic by providing short term predictions and maybe a path forward beyond the crisis.
We’re all extremely busy #shelteringinplace – we get it – so here are three TL:DR points that answer Den’s question: “Can AI solutions could provide value for supply chain in the context of a pandemic?”
Signals in the data
Right now, demand and inventory planners in consumer goods companies who deal with millions of possible decisions daily have jobs that just got a whole lot more complex. They are completely overwhelmed with demand or the lack thereof. Is this elevated consumption? Hoarding? Which parts of my portfolio are spiking vs. declining? Answer: Look for signals in your data using Ai and data science:
With the complexity of what we’re dealing with here the opportunity to listen to the data and to learn and to emerge stronger is better than ever. I think bringing in this new generation of data science driven technologies, a very comprehensive set of data that you crunch on supercomputers to give your operators the best insights, that’s the right approach.
We see a beginning, a sustained middle, and a recovery within this crisis:
Right now, we’re seeing three phases to this. I think back to Winston Churchill, ‘we’re at the beginning of the beginning.’ We may be getting closer to the end of the beginning, but that period of really immense stocking up, elevated consumption, and whatnot may be waning. We do believe that over the next several weeks, as people are bedding in with work at home and learn at home, that some of those consumption patterns will change. I don’t think consumption’s gone up, but purchasing sure has; we’ll all begin to smooth and gain a little bit of stability. And then, probably three months out, there’s a transition back to normalcy.
Taming the mother of all bullwhips
Noodle.ai built a product that begins to tackle this problem.
…with Athena Insights and Demand Signal AI….we can look at what is actually happening in Italy, and look at the pattern of the correlations and how they’re like what’s happening in New York now, and then overlay them on the future as those things spread to different geographies. The models get smarter with experience. And then certain economies will emerge. And as the virus passes, and assuming people go back to work, you can apply this in a temporal manner across your supply chain and across brands. It’s really important to understand all the different signals, all the different data sets that can be very predictive of when things are going to come back. We absolutely believe that how companies emerge from this is equally important to how they handle it when they’re in the middle of it.
When we show decision-makers these pre-built AI applications, it becomes really clear that there’s no reason to try to build this in-house. Allot of companies even don’t know these applications exist.
It’s a super exciting time because it’s this step change in technology. When you boil it down AI is just math, and most ERP systems use addition, subtraction, multiplication, division, most planning systems ignore probability theory. What AI systems are is very high dimensional multivariate calculus combined with probability theory and a learning mechanism. It’s all those things together which makes the old technology look like a spit wad. AI is more of a bazooka.
Is there a demonstrable ROI? Yes.
The areas in which we’re focusing are so sensitive, right? A 1% change in fill rate or a an increase of inventory turns – matters even during normal times – let alone right now. There are 10s of millions, hundreds of millions of dollars of benefit, of value, that people are seeing from our applications per year on a recurring basis.
The silver lining
We hope this crisis will be the catalyst for a world committed to being more prepared the next time. Let’s all:
- Adopt nextgen technology for the supply chain
- Learn from the insights in these new, dynamic datasets
- Employ better management for less waste and a smaller carbon footprint
Noodle.ai is doing its part to help supply chains run better during this difficult time and emerge out of it quickly. It’s what excites us about logging on to work every day from our #shelterinplace locations all over the planet.
