From analysing and predicting customer behaviour to powering operational automation and building an integrated Business Planning platform as a new way of looking at supply chains, the benefits of using AI in global enterprises are now well proven. Companies in all industries are having to think like technology specialists, harnessing digital tools to help them meet today’s challenges and prepare for tomorrow.
Adoption is growing fast. A recent study by McKinsey has found that businesses plan to invest even more in AI in response to the COVID-19 pandemic, and the acceleration of all things digital. Indeed, this race for success stands to create a divide between AI leaders and the companies still struggling to capitalise on the technology, threatening the success of slower adopters.
But even for the trailblazers there’s work to be done. While it’s clear that AI is a beneficial investment, it requires effective execution to generate significant value, particularly at enterprise scale. And, although a host of AI solutions are readily available in the market, promising to support companies’ digital transformation journeys, many organisations are still not making use of it to improve their decision making.
So, how can companies do better, and how they can reap the rewards of developments in AI and Machine Learning?
A wake-up call for supply chain management
During the pandemic’s first wave and the lengthy lockdowns, many global enterprises struggled to make decisions in their supply chain planning processes. Supply chain, commercial and financial teams often work using legacy systems - relying on tools like Microsoft Excel to gather and analyse data. This means that decisions are made on the basis of often obsolete information, and without understanding the entire end-to-end network.
It is well known that historical data isn’t always a good indicator of what’s happening at any given moment, and this proved particularly problematic in the midst of a global pandemic when change was happening fast, and real-time information was needed.
This served as a wake-up call, and has prompted the most forward-looking organisations to look to technology partners to help them make smarter decisions based on better, and more up to date, information. Using the power of AI and machine learning, companies are able to add ‘drivers’ to historical data, such as publicly available data sets including weather information and events, etc. and help create better forecasting models. By turning that data into knowledge, companies can make more accurate demand predictions and improve their overall planning.
Powering the recovery of the retail sector
The COVID-19 pandemic sent shockwaves through the retail sector, as all non-essential shops were forced to close their doors to the public, and retailers needed to quickly pivot online. For many, AI powered this move - helping retailers to understand and map customer behaviour, preferences and habits, enabling them to target, attract and retain online shoppers - and manage stock, supply chains and logistics accordingly. AI overhauled retailers’ abilities to balance demand and supply, and fast.
But the story has moved on, and today AI is helping smooth the transition ‘back to normal’. As retailers reopen, it’s critical to understand where and when store traffic will increase again, in order to allocate the right supply to the right channel and balance online and offline operations.
AI-powered customer data analysis will play a vital role in helping retail companies understand customer behaviour in a post-COVID world. We know that customers may be more hesitant to return to stores, perhaps wanting to shop at different times, or in different ways than before. We know that behaviour differs based on many factors such as geography, or even news on the progress or decline of the virus, and AI can show us what is happening now, and predict what is most likely to come.
Introducing Integrated Business Planning
So, it’s clear that knowledge is power, and AI is powering better and greater data usage. From online data, product sensors, to real-time track-and-trace updates, companies are data-rich but insight-poor. Put simply, data is only as good as what companies are able to do with it. If you can’t access data quickly enough, or it’s fragmented or incomplete, it ceases to be as useful as it could be.
Many organisations lack Integrated Business Planning tools - a continuous, automated process of learning from data across all business units, departments, product lines and services, which gives businesses a holistic understanding of what’s happening in all areas. Yet such tools are crucial in making an organisation’s digital transformation plans come to life.
There are solutions available that enable end-to-end connectivity, building a digital representation of the enterprise and turning data into knowledge, facilitating better and faster decision making. They help customers improve their end-to-end visibility across all the nodes in the enterprise - then turn data into actionable insights. They also power “post-game” analysis so companies can look at what they did, what worked and what didn’t, helping them to flex, adapt, grow and learn.
Integrated Business Planning software that can access and analyse company-wide, real-time data enables businesses to make better decisions and potentially has the power to make or break businesses. It is important that companies harness this ethos and avoid falling into the trap of viewing their data that exist in various units of the business as static assets or “treasure troves”. Enterprises also need to move toward harnessing real-time streaming data that continuously circulates throughout the entire organisation, not just silos.
Examples at work
AI can deliver tangible results and business value fast. If companies are able to harness the power of Integrated Planning software, bringing together real-time, comprehensive data from across a business and, using it, take action and boost decision making. For example, one of the largest retailers in the world uses these tools to improve its on-shelf availability, dynamically checking stock and ensuring fast replenishment.
The huge size of this global business meant that manual or even automated stock takes are simply too unwieldy. Instead the team needed AI to understand the full end-to-end network and allow it to make data driven decisions when constraints occurred.
Another great example is one of the largest Consumer Packaged Goods (CPG) companies, which traditionally used highly manual business processes, such as Excel and PowerPoint, in order to look at past data to make decisions for the future. This approach didn’t allow the company to spot demand risks and opportunities in a timely manner and resulted in an inability to respond with a fitted solution.
Using an AI Solution helped to build market demand and supply-knowledge models for faster gap detection and response in one platform. This allowed them to evaluate scenarios, understand risks and opportunities better, and make faster decisions across the board.
Finally, a large coffee company needed an extensive digital transformation programme to reduce administrative work for its team of baristas - freeing up their time so that they could concentrate on serving customers and delivering great customer interactions. Equally important was the ambition to reduce waste in their stores and throughout their supply chains.
By using Integrated Business Planning software, the coffee company was able to automate the forecasting and replenishment planning at the level of individual stores, ultimately saving hours of manual planning and inventory management, enabling staff members to spend more time with customers.
Think like a tech company (or go out of business)
The simple truth is that whether you are a consumer products company, an insurance broker, a hotel, travel company or a pharmaceutical giant, your business is a technology business, and data is king.
Technology like AI and Machine Learning is powering the better understanding of customers, the ability to better manage supply chains and more, and is helping many navigate the challenges posed by the COVID-19 pandemic. However, although data is powering businesses, the value of that data is lost when decision making isn’t fast enough, and companies are also suffering of data fragmentation and blind spots.
What has made digital giants like Google, Amazon and Netflix so successful is their ability to connect the dots between data from across their businesses, and do it fast. This is a critical piece of the digital transformation puzzle, and also the one where companies most often fall short. It’s also here where companies must improve.
With Integrated Business Planning, and through partnering with trusted technology experts, organisations will be armed with greater self-awareness and interdisciplinary thinking to drive radically new business models, digital transformation and power integrated business planning.
