A new survey reveals where and how often retailer use artificial intelligence (AI) and machine learning (ML) in the supply chain.
According to findings from “Role of AI/ML in Supply Chain and Demand Forecasting,” a new survey of North American retail executives from Symphony RetailAI and Incisiv, 82% of respondents are focusing on data-driven demand forecasting, and 61% see improved master data management as a top supply chain priority.
The survey asked retail executives to evaluate their supply chain performance over the past two years and indicate areas of the supply chain where they intend to focus improvement efforts. Respondents also had the opportunity to describe their organization’s use of artificial intelligence (AI) and machine learning (ML) and identify perceived barriers to the adoption of these technologies.
Close to nine in 10 (87%) respondents think their company’s supply chain performance either lags the competition (22%) or is on par with it (65%). Only 13% of respondents think they outperform their peers. However, the large majority (87%) of respondents say they have not yet taken meaningful steps to embrace AI in their supply chain.
A very small percentage (6%) of respondents were self-described adopters of AI, while another 8% have dabbled or had early success with piloted AI technology. Many respondents who haven’t made progress with AI are uncertain about how to move forward successfully, as 39% indicated they are unsure how to apply AI to real-world scenarios.
Other interesting findings include:
Nearly nine out of 10 respondents (88%) state that they have a significant opportunity to improve in demand forecasting, and the same percentage want to do better with contingency supply source planning.
More than nine in 10 (92%) respondents feel that their inability to integrate data from multiple sources prevent them from successfully pursuing AI solutions. Other roadblocks include poor data quality (79%) and a lack of confidence in AI to make good recommendations (31%).
More than one in five (22%) respondents are concerned about falling behind to the competition due to a lack of an AI-based strategy.
Retailers prioritize AI across the enterprise
Supporting findings that retailers see value in AI, two-thirds (65%) of retail respondents to a recent survey sponsored by end-to-end, multi-cloud technology solutions company Rackspace Technology said AI and ML are technologies that are among the most mission-critical to their business strategy.
More than seven in 10 Rackspace survey respondents said AI/ML has had a positive impact on revenue generation (72%) and on expense reduction (72%), while 69% reported AI/ML has had a positive impact of on brand awareness, and 67% said these technologies have had a positive impact on brand reputation.
“As new threats loom and other economic factors create supply chain unpredictability, these results highlight the need to future-proof grocery supply chains to handle unexpected disruptions,” said Troy Prothero, senior VP product management, supply chain solutions, Symphony RetailAI. “The importance of using data, including AI-driven demand forecasting, to gain a competitive supply chain advantage isn’t going away, so organizations that prioritize new ways of using data for decision-making will be better positioned to succeed.”
“Our research with Symphony RetailAI sheds light on the critical need for retailers to use AI to break down silos and utilize as much organizational data as possible,” said Gaurav Pant, chief insights officer, Incisiv. “Doing so will give retail organizations a competitive advantage through optimized and integrated end-to-end supply chains.”
Symphony RetailAI commissioned Incisiv to conduct an executive survey covering North American retailers across consumer goods retail segments such as grocery, general merchandise, home improvement, drug, dollar/discount and convenience.