What is All the Hoopla Over ChatGPT?

If you haven’t been living under a rock, you’ve heard about ChatGPT and other AI (artificial intelligence) competitors such as Google’s Bard and Elon Musk’s AI platform. Everyone has gotten into the conversation, from marketing professionals to tech experts to people like Elon Musk are talking about AI and how it will transform the world…..with a bit of caution throw in for good measure.

Artificial intelligence has been around for quite some time. Who doesn’t own an Alexa? Even my Mom thought Alexa was the best gift she ever received as it is an easy alarm, answers questions, tells her about the weather and much more. With that said, AI has expanded far beyond Alexa in recent years.

What are the Uses of AI in Manufacturing?

There are many uses of AI in manufacturing and supply chain. According to Markets and Markets, artificial intelligence in manufacturing market size is valued at $2.3 Billion in 2022 and anticipated to increase to $16.3 Billion by 2027. That is a MASSIVE increase. Obviously, there is vast potential, and so you better get on board, use common sense, and determine what makes sense to support your long-term objectives. Here are a few of the common uses:

  • Predictive maintenance: AI is used to collect data from machines and predict which will break down and what maintenance should be performed to avoid breakdowns and maximize output.
  • Demand forecasting: AI can be used to predict future trends instead of relying solely on historical patterns. After all, historical patterns are no longer sufficient.
  • Generative design: In engineering intensive environments, AI can be utilized to mimic the design process to quickly produce hundreds of design options for a single product. We work with several clients that could use this base once it produces a solid base.
  • Raw material pricing: Similar to demand forecasting, AI can be used to forecast commodity prices.
  • Machine optimization: Edge analytics uses data sets gathered from machine sensors and can provide insights on how to maximize efficiencies and minimize waste.
  • Quality controls: AI can also monitor quality and quickly identify defects so that quality can be built into the process instead of identified later.
  • Robots: AI robots can help eliminate the monotonous operations, reduce errors and eliminate waste.
  • Supply chain alerts: By monitoring your end-to-end supply chain with AI, you can be alerted to supplier failures, impacts predicted and options evaluated.
  • Autonomous vehicles: AI can be utilized to automate the factory floor, optimize deliveries, and ensure the production line continues to run.
  • And many more…..

AI Uses in Logistics

Similar to manufacturing, there are a mountain of uses in logistics including the following:

  • Autonomous vehicles: Self-driving trucks are being tested and could greatly minimize the issues associated with the shortage of drivers.
  • AI Warehouse Automation: AI can be used to track robots, inventory, identify errors, and monitor warehouse conditions.
  • AI for visual inspection and damage detection: AI is being used commonly to quickly and accurately identify damaged goods on a conveyor belt before they ship to a customer.
  • Predictive maintenance: Similar to manufacturing, predictive maintenance is an improvement over preventative maintenance.
  • Delivery drones: AI can power delivery drones that can streamline and automate the shipping process.
  • Route planning & optimization: Why calculate thousands of potential routes manually? Instead, use AI to run through thousands of route permeations and take into account other factors such as weather, traffic, and construction to optimize your freight.
  • Data-Driven Analytics: Use AI to track and manage the flow of goods throughout the supply chain. Identify potential issues and mitigate them before they occur.
  • And many more…..

Is AI Good or Bad?

Certainly, there are many valuable uses of AI in manufacturing and supply chain. If you want to thrive, you will need to embrace AI. Of course, you cannot blindly follow artificial intelligence. Use a bit of common sense, start with practical applications that will provide immediate value with strong paybacks, and expand where it makes sense. Do not jump in and let AI take over. Instead, think about what you’re doing, test the results, and expand.

There are many positive results from using AI. These include error-free processing, automation of repetitive tasks, 24/7 availability, faster decision-making, predictive capabilities etc.

On the other hand, there are drawbacks as well. One is that humans no longer have to think. That is a BIG concern if you don’t maintain this ability to monitor AI etc. Big unions such as the ports are worried about unemployment. However, there is a lack of talent in today’s marketplace, and it does not appear to be improving with the retirement of the baby boomer generation. In fact, more high-skilled roles will be needed with AI. On the other hand, if you aren’t interested in learning and prefer repetitive tasks, your job is likely to go away. The statistics prove this worry to be false. For example, UPS put automation and AI in place in a large distribution center, and their volume increased, propelling them to hire more people. This is a common story yet there remains a LOT of controversy. Unfortunately, making the U.S. more uncompetitive vs. China’s ports is not the solution as we already are manual vs. using technological advances, automation, and robotics.

Elon Musk and and a group of artificial intelligence experts want to pause the development of AI. They want to make sure the risks are mitigated and that the effects will be positive for advanced uses. For example, who wants their car to drive into a crash without the ability to stop it? This has created a lot of controversy as countries like China will not pause. It is creating quite the controversy. We need smart thinkers using common sense and collaborating to “win this technological war”.

Who certifies the certifiers?

On the other hand, using ChatGPT is largely non-risky – unless you take its conclusions as accurate without verification. It will lead you down the wrong path. There are countless examples of ChatGPT predicting what likely occurred but was not based in reality. The key question is, “Who certifies the certifiers?” as my consulting mentor Alan Weiss points out. The same holds true for AI. Who programs the ‘truth’ into ChatGPT and the like? In fact, ChatGPT is working with 2 year old data, and so as much as it can be valuable in creating a base, do NOT run with AI/ ChatGPT to the bank. Or, you will walk out like a Silicon Valley Bank investor.

Should Manufacturers and Distributors Pursue AI?

Only if you want to stay ahead of changing market conditions in an efficient, cost effective, error-free manner!

Bring on experts and consultants. Provide training and education for your teams. Learn about AI, its uses, how it could add value in your situation, and evaluate potential business partners/ software suppliers. Take the leap with a controlled pilot. And surpass your competition! Only the technologically advanced will thrive in the next decade.

How Does AI Relate to ERP?

Modern ERP and related systems (such as advanced planning and demand planning systems) are incorporating AI. It will no longer be sufficient to struggle with an outdated ERP system. If you do not have a modern ERP system, hire an ERP selection consultant to help you find the ‘right’ system for your critical requirements and take the plunge to upgrade your ERP system.

If you are interested in discussing how to incorporate AI and related technologies into your technology roadmap review our ERP and technology resources and/or contact us to discuss your situation.

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