AI, a necessary tool to strengthen supply chains

The pandemic, the shortage of semiconductors or the war in Ukraine managed to show the weaknesses of supply chains in a very short time.

Supply chains are facing an unprecedented challenge. According to the Financial Times, the war in Ukraine could mean the end of globalization and the breakdown of supply chains as we know them. But the conflict in Eastern Europe is just the latest in a series of deep shocks to the global supply system over the past two years.

The pandemic, the shortage of semiconductors or the blockade of the Suez Canal have managed to show in a very short time the weaknesses of a global network which, over the past three decades, has been the main global driver of economy and trade. According to calculations by the European Parliament, today two out of three world trade flows revolve around these chains or gears. A permanent crisis for a sector which, for years, was based on predictability. The acceleration and increasing number of external and unexpected shocks have been the main enemies of supply chains based on their robustness and operability. Consequently, the instability of the situation obliges all decision-makers to launch a process of reflection and questioning of the traditional model.

Strategic autonomy

Concepts such as strategic autonomy are already on the table of legislators. Last February, the European Union approved the mobilization of more than 43 billion euros, an amount with which it aspires to produce 20% of chips worldwide by 2030 and to reduce its dependence on other powers like China or the United States. But how can businesses cope with these global upheavals?

The most immediate mechanism is through the digital transformation of the sector. Thanks to the consolidation of these major information highways, through the application of bigdata and the exchange of information, it would be possible to anticipate this type of disruption in the future, or at least to act immediately on the weaknesses that may appear in the supply chain and to redirect efforts towards these points reviews.

AI solutions

The colossal amount of data processed by the security sector logistics and transport, the main support of supply chains, is another point to consider in the development of solutions forartificial intelligence (IA). The automation and simulation of processes, which are the basis of the new business intelligence, are the starting point for improving the productivity companies. This helps foster relocation strategies and the creation of highly skilled jobs, instead of low-skilled labor in third countries.

These relocations make it possible to shorten value chains, an essential step in improving their efficiency and sustainability. According to data from the World Trade Organization, between 20 and 30% of global greenhouse gas emissions are linked to international trade. Reducing the distances between producers, distributors and consumers would therefore mean a drastic reduction in their ecological footprint. Although France strives to adopt this type of technological solution, the potential and the possibilities they offer are immense, and we must be able to transform this deep crisis into a real opportunity.

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AI, a necessary tool to strengthen supply chains

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