Secondmind released new research today indicating that 86% of U.S. supply chain decision-makers surveyed have been left frustrated by AI-powered systems and tools during the COVID-19 crisis.
Secondmind commissioned independent global research firm Census-wide to survey over 250 supply chain planners and managers across the U.S. to learn how AI was helping or hindering their decision-making.
The results, released as part of a new global report, show that despite the frustration, belief in AI’s potential is strong – 92% of U.S. respondents agree that AI-powered tools and software will help them make better decisions by 2025 and over half (67%) of those strongly agree that AI will transform supply chains for the better in the next five years.
MIT Professor Yossi Sheffi told SCMR in an interview that an essential lesson from the crisis is that flexibility and agility are critical to managing the pandemic’s disruptions and the pivot towards a changed future.
“Supply chains will be at the core of the recovery. As supply chains served humanity during this global crisis and will continue to do so when the pandemic subsides and beyond,” he said.
The barriers to fulfilling AI’s potential
But managers in the U.S. who were surveyed by Secondmind cited a number of factors hindering the ability of AI systems to deliver value, all of which fell into two categories:
● Data: a lack of reliable data to feed into AI systems (41%), historic data becoming ‘meaningless’ in times of unprecedented change (17%) and the need to spend significantly more time on manually analyzing and interpreting data (51%) were concerns at a time when accuracy and speed were of the essence.
● Organizational: over a third of respondents (37%) said their leadership teams lack an understanding of what is currently needed on the ground to make faster, data-driven decisions. Furthermore, rigid processes and internal structures prevented over two in five planners and managers from quickly responding to changing market conditions (43%).
A longer road to resilience
Supply chain planners and managers in the U.S. who were surveyed believe that a third of their time (on average 3.05 hours daily) is spent on manual tasks that could easily be automated. As frustrations with current AI systems emerged during the pandemic, more than half (51%) said they spent significantly more time manually analyzing and interpreting data to assist strategic and operational decisions.
Decision-makers in the US who were surveyed state these data pain points are holding them back from working on higher value initiatives that could contribute towards building more resilient supply chains, such as:
● Proactively preparing scenarios and plans for future ‘black swan’ (unexpected) events (30%)
● Spending more time on proactive and in-depth planning for major events such as Christmas and Black Friday (38%)
● Conducting more in-depth analysis, using experience and expertise (57%)
The power of human & AI collaboration
The majority of surveyed managers in the US who use AI systems want their domain expertise to factor into decision-making process. Desirable capabilities included: the ability to modify AI-generated forecasts using the decision-maker’s own judgement (54%), AI that can learn from humans when historic data is unreliable (42%) and if AI could show data or contextual information that impacted a forecast (40%).
Of those in the U.S. who believed AI alone was not enough to inform effective decision-making surveyed, the reasons cited were that human intuition cannot be replicated by a machine (64%), there will always be some events that a machine can’t predict (54%) and expertise developed from years on the job is critical in decision-making (45%).
“COVID-19 has been a wake-up call for businesses operating in global supply chains as they prepare to rapidly accelerate the implementation and deployment of AI in the coming years,” said Vishal Chatrath, CEO and Co-Founder, Secondmind.
He added that for AI to realize its potential, it will be critical for organizations to deploy systems that can cope with sparse or incomplete data environments and promote the effective collaboration between people and AI.
“Our report shows how much people benefit from AI, but also how much AI needs people,” he concluded. “A collaborative approach to decision-making that combines the right skills and capabilities for each task is essential, particularly when systems are disrupted during uncertain times and unpredictable events.”
About the Author
Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at [email protected]