Sales and Fulfillment
AI-driven demand forecasting: Enhancing accuracy in supply chain planning
AI is transforming supply chain planning by automating data analysis across supplier tiers, demand forecasts, and risk indicators. This enhances forecasting accuracy, aligns supply with demand, and strengthens early-warning systems by evaluating financial data, weather patterns, and social signals. Despite these advancements, supply chain vulnerabilities persist due to visibility gaps and compliance challenges. AI mitigates these risks, driving agility and resilience in dynamic markets.
This article explores how AI in supply chain management is revolutionising supply chain management, delivering precision, efficiency, and adaptability to safeguard operations and ensure long-term success.
The AI-powered supply chain forecasting: Smarter, faster, and more efficient
From warehouse operations to demand forecasting, AI is enhancing accuracy in supply chains. Let’s explore its impact:
Smart warehouses: The backbone of efficiency
AI-driven optimisation transforms warehouse operations by analysing material flow to enhance layout and racking systems. Machine learning models optimise worker and robot movement, reducing retrieval times and increasing fulfilment rates. AI-powered forecasting ensures the right balance between inventory availability and carrying costs, maximising storage capacity without excess waste.
Driving down operating costs
AI’s ability to automate repetitive tasks, such as inventory tracking and cycle counting, significantly reduces labour costs. Intelligent predictive maintenance identifies potential equipment failures before they occur, preventing costly downtime. AI also streamlines logistics, reducing delays and optimising supply chain flows.
Eliminating errors and waste with precision
AI systems detect defects and inefficiencies far faster than human oversight allows. Computer vision and machine learning inspect products in real-time, minimising recalls, returns, and rework. AI-powered ERP integrations further reduce billing errors, ensuring financial accuracy across supply chain transactions.
Next-generation inventory control
AI-powered forecasting utilises real-time customer data to adjust inventory levels dynamically. Computer vision systems track stock levels, while automated inventory documentation enhances accuracy. These technologies prevent overstocking and shortages, ensuring optimal supply chain performance.
AI-driven simulations for operational excellence
Digital twins—virtual models of logistics networks—enable risk-free testing of process improvements. AI-driven simulations help refine supplier selection, transportation routes, and production schedules, leading to leaner, more cost-effective operations.
Strengthening workplace and material safety
AI enhances workplace safety through computer vision and IoT-enabled wearables that monitor adherence to safety protocols. Automated tracking of hazardous material handling ensures compliance with regulatory requirements, reducing risks for workers and the environment.
Faster, more reliable deliveries
AI optimises delivery routes, prioritises shipments, and predicts estimated arrival times with precision. Machine learning models analyse weather conditions, traffic patterns, and supply chain disruptions, allowing for proactive adjustments that keep shipments on schedule.
Sustainable supply chains with AI
AI promotes sustainability by minimising waste and reducing carbon footprints. Machine learning models optimise truckloads to lower fuel consumption, while AI-driven analytics help manufacturers transition to circular economy practices by extending product lifecycles and recycling materials.
Hyper-accurate demand forecasting
AI excels at predicting demand fluctuations by analysing internal sales trends, external market conditions, and economic indicators. Supply chain planners can model various scenarios to assess potential impacts on inventory, costs, and production capacity, allowing for proactive decision-making.
Generative AI
Gen AI enhances decision-making with scenario analysis, boosts planner productivity by automating routine tasks, and reduces risk by identifying potential disruptions. These improvements can lead to a decline in supply chain costs, an increase in forecast accuracy, and a workload reduction for planners.
AI demand forecasting: Accuracy in action
AI in supply chain planning is already being harnessed to enhance demand forecasting accuracy. Below are some real-world applications demonstrating its transformative impact:
Retail and e-commerce
AI-driven forecasting enables retailers to anticipate demand fluctuations across different locations and seasons. By analysing purchasing behaviour, weather patterns, and promotional strategies, businesses can adjust inventory levels, accordingly, preventing overstocking and stockouts.
Manufacturing and production planning
Manufacturers leverage AI demand forecasting to align raw material procurement and production schedules with expected demand. This reduces waste, improves resource utilisation, and ensures timely fulfilment of customer orders.
Consumer packaged goods (CPG) and FMCG
AI-powered models help consumer goods companies predict sales trends, optimise promotions, and enhance supply chain efficiency. With real-time analytics, companies can adjust distribution strategies dynamically to meet shifting consumer preferences. By embracing autonomous supply chain solutions, manufacturers can reduce costs, enhance agility, and drive sustainable operations.
Pharmaceutical and healthcare
Accurate demand forecasting in supply chain operations ensures the timely availability of critical medications and medical supplies. AI can predict disease outbreaks, seasonal demand fluctuations, and supplier disruptions, enabling proactive stock management.
How can Infosys BPM transform your supply chain with AI-powered planning ops?
Infosys BPM offers AI-first solutions that seamlessly align sales and supply chain strategies. Enhance your planning operations with AI-powered demand sensing, dynamic forecasting, and multi-echelon inventory optimisation. Infosys BPM Planning Ops capabilities include S&OP automation, supplier collaboration, and AI/ML statistical models for risk prediction and supply chain optimisation. Discover how Infosys BPM can help you create a future-ready, high-performance business.
