Artificial intelligence (AI) has great potential to propel supply chain efficiencies, sustainability efforts, and regulatory compliance despite only limited use by companies today, according to research by Inspectorio.
The survey found that 82% of supply chain professionals indicate technology advancements will have a significant impact on the supply chain over the next five years. Specifically, innovations in AI and machine learning have led to notable advancements in quality assurance, predictive analytics, and operational efficiency, supporting improved decision-making and transparency.
Despite this, 77% of respondents indicated that AI is not yet integrated into their supply chains. The current lack of AI-powered tools was cited by 47% of respondents as the primary barrier, highlighting a significant gap in the market for industry-specific AI solutions. Restrictive IT policies were cited as the second largest barrier to adoption (22%).
The data comes from a survey of 144 professionals throughout the supply chain industry, including the sectors of: apparel & footwear (56%), home & furniture (12%), food & beverage (6%), multi-category retail (6%), outdoor & sports (1%), and other (18%). They represented the various industry types of: factory (44%), brand (22%), supplier (19%), retailer (13%), and other (2%).
The results were summarized in a report called “State of Supply Chain Report 2024” by Minneapolis-based Inspectorio, which provides an AI-powered supply chain platform optimizing performance across production chains for brands, retailers, and suppliers.
With risk management, compliance pressures, and budget constraints rated as the primary challenges facing the industry, many professionals are managing risk through supplier diversification, enabled by technology advancements. Diversifying supplier bases not only addresses compliance pressures and budget constraints, but it also acts as a pivotal strategy for risk mitigation.
“As evidenced in the report, conflicting priorities exist between increasing operational efficiency and spearheading sustainability and traceability efforts at various points along the production chain,” Chirag Patel, CEO of Inspectorio, said in a release. “The current lack of AI adoption throughout operations highlights the need for tailored solutions to create an effective roadmap to navigate a dynamic and evolving supply chain.”
