The C&O Railroad company was trying to connect Chesapeake Bay to the Ohio River. After hundreds of miles of arduous work laying track, the path ran into the Appalachian Mountains. The work of laying the track went from difficult to almost impossible. The only way through the obstacle was to dig giant tunnels. However, the sledgehammer – the tool of choice at the time –, was not powerful enough against the hard rock. One day, as the story goes, a man showed up with a steam powered jackhammer. The bosses were skeptical and said their team could do just as well if they just worked harder. A contest between John Henry, by far the strongest, most fearless steel driver, and the jackhammer ensued. Well, it turns out that John Henry did beat the jackhammer for one day, but he died from the effort. After that, jackhammers were used to dig tunnels and the track was laid connecting the two vital bodies of water.
I heard this folk tale many times as a child. I always wondered how great it would have been to hear about John Henry using the jackhammer. Imagine how far and fast he could have dug that tunnel.

 

The problem with traditional supply chain systems.

When I think of today’s businesses, I am reminded of this tale. Why do so many businesses make their teams use sledgehammers when jackhammers are newly available?

Over the last six years my company has partnered with many customers to eliminate waste in supply chains. Every year there are over two trillion dollars of lost profits and over half of the world’s waste generated from how we manufacture and distribute goods. The people running these supply chains – from executives to factory workers to planners – are some of the smartest and hardest working people I know. However, as supply chain volatility and complexity hits unimaginable levels, it seems reminiscent of those railroad workers hitting that mountain.
Traditional software for inventory planning and quality management (ERP, APS, QMS, MES) play important roles in running supply chains. However, when plans hit reality (also known as the execution horizon), these tools are failing their users. The execution horizon is when patterns get so dynamic and fast moving that sledgehammers don’t work.

Well, the metaphorical jackhammer has arrived.

 

Enterprise AI supply chain apps can move mountains.

With hyper-exponential advances in high performance computing, data storage affordability, and artificial intelligence (AI) algorithms, the technology exists to help supply chain professionals dig that tunnel and live to tell the tale.

Leading companies like Kellogg’s, Estee Lauder, Materion, and US Steel are using AI powered software crunching on large data sets and supercomputers to sense ultra-complex patterns, predict likely outcomes, and recommend specific actions in the execution horizon to eliminate waste and wasted profits.

Still, artificial intelligence algorithms are powerful tools but cannot solve all problems. Claims made by some AI platform companies that AI can solve all problems or can replace all operators are apocryphal – at least for the knowable future. Jackhammers are useful but cannot plan what tracks to lay. Supply Chain AI tools are most useful to solve unique problems, sometimes called use cases. Specifically, AI can help give visibility to upcoming quality issues, equipment failures, inventory imbalances, and mismatches in production and demand. These tools then can calculate the highest probability actions to eliminate waste and boost profits. These recommendations can then be fed back into traditional systems like ERP or QMS to carry out these tasks.

The AI challenges in supply chains are some of the most difficult around. It is much harder than recognizing pictures of cats or even language translation. And much harder than figuring out what advertisement to show you based on what you typed into Google yesterday. Supply chains have millions or even billions of sensors and other data feature combinations, complex causal linkages to planned future actions, and constantly changing targeted outcomes, all in highly volatile conditions.

Creating AI driven software with accurate simulations to predict lost profits, and recommendations that select best actions is tough going and has taken our data scientists, engineers and subject matter experts years of research and development with many mistakes, failures, and dead ends along the way.

 

Make profit, not waste.

It is our hope that you and your teams can benefit from the persistence, talents, creativity, and pioneering efforts of our team through our Enterprise AI® supply chain applications. We have seen the joy created as our customers’ planners and operators move from sledgehammer to jackhammer and power through the mountain.

Please visit www.noodle.ai and set up a demo.