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Supply Chain Industry Updates

In the Race to Adopt AI, Don’t Forget Us Humans

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Story highlights:

  • Organizations are embracing technologies like AI to help them manage supply chain disruption.
  • However, many users report feeling “frustrated” by AI so far.
  • The successful rollout of technology requires “empathetic leadership.”
  • How effective that leadership has been so far is open to debate, IBM says.

Being human, it’s only natural that we seek out tools to make our lives easier. Then again, it’s only natural that sometimes we get frustrated with our tools.

Looking at the results of two recent studies, you could get the impression that a similar dynamic is playing out in the use of artificial intelligence and other technology tools to manage COVID-disrupted supply chains. Fortunately, it doesn’t rise to the level of human-technology conflict that played out in movies like “2001: A Space Odyssey.” Plus, once the cyber-dust has settled, you probably won’t be left thinking, “What was that all about?

What it is about, according to survey results released by IBM, is organizations’ enthusiastic embrace of technology tools in 2020 and the limits they are running up against. Nearly 6 in 10 told IBM that they had accelerated their digital transformations due to the COVID-19 pandemic. Their efforts can be broken down into 3 major steps:

  • Improving their operational scalability and flexibility;
  • Applying AI, automation and other “exponential technologies” to make workflows more intelligent; and
  • Leading, engaging and enabling the workforce in new ways. (If you’re reading this while sitting on a couch at home instead of sitting behind a desk at an office, you know what that is about.)

“Leaders need to redouble their focus on their people as well as the workflows and technology infrastructure that enable them.”

“For many, the pandemic has knocked down previous barriers to digital transformation and leaders are increasingly relying on technology for mission-critical aspects of their enterprise operations,” Mark Foster, IBM Services senior vice president, said in a statement. “But looking ahead, leaders need to redouble their focus on their people as well as the workflows and technology infrastructure that enable them — we can’t underestimate the power of empathetic leadership to drive employees’ confidence, effectiveness and well-being amid disruption.”

Yep, it all comes back to the people who use the tools. Another new report, this one by AI software provider Secondmind, found supply chain executives were overwhelmingly sold on the idea of using AI to help them make better decisions and most expected AI to change supply chains for the better in the next half decade.

However, a whopping 82% of them also reported that they had been “left frustrated by AI-powered systems and tools during the COVID-19 crisis.” A lack of reliable or relevant data to feed into the AI system was one of the reasons for this. Plus, many complained about the time they had to spend manually analyzing and interpreting data.

“Our report shows how much people benefit from AI, but also how much AI needs people.”

Another obstacle to successful adoption of AI was organizational. Supply chain managers told Secondmind that their leadership did not understand what they required to make faster, data-driven decisions. Bureaucracy in the form of rigid processes was another complaint.

“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, Secondmind CEO and co-founder. “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. 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.”

Skills and the need to develop them came up in IBM’s study, too, as did the risk of burnout as people struggle to learn how to use their new tools. IBM identified a “significant disconnect in how effective leaders and employees believe companies have been in addressing these gaps. 74% of executives surveyed believe they have been helping their employees learn the skills needed to work in a new way; just 38% of employees surveyed agree. 80% of executives surveyed say that they are supporting the physical and emotional health of their workforce, while just 46% of employees surveyed feel that support.”

If organizations are serious about improving their supply chain resiliency, then this disconnect will need to be resolved. After all, the adoption of sophisticated tools like AI is not going away, nor is the probability of more disruptive events. In fact, in the next 2 years, IBM predicted that executives’ “prioritization of AI technology will increase by 20 percentage points.”

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