Artificial Intelligence (AI) is changing the business world, transforming operations across industries. However, while it shows promise, 70% of business implementations fail due to a lack of understanding, poor data quality, and a lack of total-business buy-in.
Business leaders globally face the same challenges – turbulent economic conditions, skilled labor shortages, cyber threats, and pressure to enhance the customer experience. AI can alleviate some of these pressures through its ability to mimic human decision-making.
It is not about replacing people – on the contrary, it returns time to employees to focus on strategic and value-adding activities. Additionally, embedding AI offers cost-saving opportunities, freeing up capital to reinvest elsewhere.
From enhancing customer experience and building connectivity, to forecasting demand, and optimizing inventory management, AI is reshaping how businesses operate in today's digital age.
Connecting the dots.
Firstly, AI enhances operations through its ability to make fast decisions, based on data, improving efficiency and productivity. As an example, AI can:
- Reduce human errors.
- Speed up processes.
- Automate repetitive tasks.
- Optimize planning decisions.
Plus, much more. But what does it all mean for business success? The answer – enhanced customer experience, ongoing brand loyalty, and an opportunity to reinvest in your customer.
How? By enhancing how customers interact with your business.
Customer experience (CX), from the first point of interaction, is essential to business success as it impacts sales, operations, retention, and value. Research by Harvard Business Review, highlights the direct link between CX and annual revenue, reporting that customers who have positive interactions with a brand spend 140% more than those who report a negative experience (1).
However, a good customer experience isn’t just framed by marketing, it’s a total business effort across product, price, promotion, online experience, and on-time delivery – all of which are underpinned by supply chain efficiency, from manufacturing, to logistics, to end customer.
As quoted by Lisa Callinan, “Customers are influenced by their experience of the supply chain – even in the simplest terms, it’s easy to see that a late delivery can disappoint, whereas an expedited delivery can delight” (2).
Digitizing the supply chain and leveraging AI can revolutionize supply chain operations and management, directly influencing customer experience. This means the supply chain becomes a strategic enabler for growth and a competitive point of difference - offering ways to grow, optimize costs, and remain agile. Many household names such as Amazon and Apple use supply chain expertise to enhance customer experience.
When done well, a digitized supply chain can offer significant improvement and cost optimization, allowing for an avenue to reinvest in the customer, whether it be in price, promotion, or business expansion.
While the benefits of digital transformation using AI are justifiable, the challenges presented by AI must not be overlooked. Queries of ethics, transparency, cyber security, and talent remain a concern. However, to fully embrace the future of AI in business, companies need to overcome these challenges. This involves defining the right use cases, investing in AI capabilities and infrastructure, and creating a culture of innovation - centered around leveraging the supply chain as a strategic enabler for growth. By doing so, businesses can unlock the full benefits of AI, transforming their operations, and staying ahead in an increasingly competitive marketplace.
The TMX whitepaper, ‘AI: An Indispensable Ally’, not only outlines ways businesses can approach these challenges, but reviews ways AI can be embedded into the supply chain. We spoke with Dr. Kim Oosthuizen, Head of Artificial Intelligence at SAP ANZ and PhD of AI in business; Aaron Ling, Founder and CEO of LXOpt Ltd; and Glen Borg, Head of Simulation at TMX Transform on how businesses can consider AI – where to start, where it should be used, the future employee, and remaining competitive.