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Posted 6 November 2023 by
Adam Lester-George
Content Specialist for Binocs Technology

AI-enabled supply chains: 5 takeaways from Let’s Get Phygital 2023

The 2023 “Let’s Get Phygital” event was a great success, bringing together industry leaders (both in person and remotely) to discuss the fascinating topic “the future of AI-enabled supply chains.” Keynote speaker, author and futurologist, Magnus Lindkvist, was joined by Sanofi’s Head of Digital Supply, Leif Skibsted Jakobsen, and SVP Industry Principal at Logility, Piet Buyck. These three pioneering talks brought unique perspectives, drawing from a wealth of experience and expertise to illuminate the conversation with insights into how AI is reshaping supply chains. Below, we summarize 5 of the key take aways.

Takeaway 1: AI represents a diverse landscape

Leif Skibsted Jakobsen highlighted AI’s diversity by describing the two distinct types that underpin Sanofi’s ‘plai.supply’ mobile app: “expert AI,” which performs specialized tasks with precision, and “snackable AI,” which is user-friendly and quickly digestible for non-experts. This distinction was further supported when Piet Buyck described how Logility’s ‘Garvis’ platform combines a large language model AI (ChatGPT) with AI-native demand forecasting to simultaneously decipher complex data patterns and present the results in human-like text.

Understanding the varied landscape of AI is crucial as they could redefine the trajectory of technological advancement and operational efficiency in many industries, including supply chains. Magnus Lindkvist highlighted this exact point by noting the potential of quantum computing to deliver even more sophisticated forms of AI.

If you ask your questions, the AI system will react to it and explain it; it will not get tired, it will explain it until you understand it and all the information will always be up-to-date, because the information underlying it is digital.

Piet Buyck

Takeaway 2: AI-enabled supply chains introduce visibility

As Lindqvist mentions, the amount of time the average person needs to work to afford one hour of reading light has reduced from 6 hours at the start of the 19th Century to just 8 seconds today. In a similar vein, AI’s rapid advancements are now allowing organizations to illuminate their supply chains, bringing clarity and insight into an often-opaque world at a progressively lower price point.

This is perfectly illustrated by the fact that Sanofi uses Bluecrux’s Axon digital supply chain twin to combine disparate data generated across its own incredibly complex supply chain (featuring 59 manufacturing plants, more than 200 contract manufacturers, with more than 120 distribution centers feeding 6,000 different transportation routes, for shipping 13,000 product references, all managed by at least 10 different ERP source systems). This discussion of AI finding hidden patterns was expanded by Buyck, who highlighted how AI can extend forecasting capabilities beyond simple statistical assumptions that the past will repeat itself. Being able to generate genuine future-looking, predictive insights shows how AI can enhance strategic planning and operational foresight.

Axon can not only map-out the end-to-end value stream of products but it also gives visibility into the concrete, demonstrated lead times of each and every step in the supply chain, and the lead time variabilities. This is super powerful information that we get extremely fast and with very limited business interaction.

Leif Skibsted Jakobsen

Takeaway 3: AI-enabled supply chains offer genuine insights

Piet Buyck opened his talk by highlighting that S&OP processes have basically remained unchanged since the 1990s, comparing their analog nature to a much beloved vinyl record collection. By contrast, he notes that we live in a world where music is, today, accessed digitally, via platforms such as Spotify; supply chain planning should also move in that direction. This transition is something that Lindqvist refers to a “Kansas Moment,” a point at which external pressures cause dramatic change, thrusting individuals and industries into a new reality replete with possibilities previously unimagined.

This is what has driven the development of AI-enabled platforms like plai.supply and Garvis and is what allows them to provide more than just information; they offer a transformed understanding of that information, turning complex data into actionable strategies that can lead to more informed decision-making and responsive business operations.

plai.supply puts decision intelligence in the hands and in the pockets of everybody because we want to help people make the right decisions by providing really actionable insights—not just data and dashboards but insights

Leif Skibsted Jakobsen

Takeaway 4: AI encourages creative experimentation

As Lindqvist mentions, Bluecrux promotes innovation through “The Cutting X”, combining disparate ideas to create novel solutions. This aligns with his championing of a culture that places experimentation front and center, one in which competition drives refinements but creativity drives innovation.

This notion of creative experimentation is reflected both in Sanofi’s decision to commission Aily Labs to develop plai.supply, and in Logility’s acquisition of Garvis. By taking such creative chances, Sanofi’s supply chain specialists are now able to predict 80% of all their low inventory risks—which has been calculated to generate hundreds of millions of euros in inventory savings across the company—while Logility is able to dramatically reduce the latency of their clients’ decision-making capabilities. These examples reinforce the idea that AI can be a catalyst for organizational transformation, fostering a climate where experimentation is not just accepted but encouraged.

What is the alchemy of creation? There’s no recipe, there are no fixed rules, it’s an eternally evolving template or toolbox of ideas.

Magnus Lindqvist

Takeaway 5: AI represents an opportunity, not a threat

Despite Lindqvist’s reference to the AI-enhanced legal algorithm developed by Lawgeex, which reviews legal contracts faster and more effectively than humans, AI is not an existential threat to the law profession. Being able to process large amount of information rapidly, AI will certainly facilitate the work of lawyers, however, lacking a nuanced understanding of human life means that AI will not soon replace them.

In the same respect, Buyck’s talk highlighted the fact that a large language model such as ChatGPT does not ‘comprehend’ the information it processes—it simply connect inputs to contextually probabilistic outputs. For this reason, he unambiguously states that a Planner’s oversight remains critical, steering the AI’s computational power to yield meaningful outcomes. Likewise, Jakobsen notes that Axon’s AI can process vast quantities of raw data from Sanofi’s ERP systems—making connections that humans simply wouldn’t have the time to identify—but the proposed value-mapping must still be guided through multiple iterations by the specialist professionals who have the deep understanding that a machine lacks.

The role of the human will become even more important than before and generative AI will work as a communicator of things that were, up until now, maybe more difficult to communicate.

Piet Buyck

These takeaways from Let’s Get Phygital 2023 encapsulate a multifaceted view of AI’s role in supply chains, revealing the potential of AI to not only enhance current operations but also to serve as a springboard for future innovation and sustained competitiveness in a rapidly evolving business landscape.

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