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BuildingaSmarterSupplyChain

ThepowerofAIandBlockchain

todrivegreatersupplychainvisibilityandmitigatedisruptions

BuildingaSmarterSupplyChain

ThepowerofAIandBlockchaintodrivegreatersupplychainvisibilityandmitigatedisruptions

Theglobal,digitaleconomyisradicallyreinventingbusiness.Forleadersacrossindustries,it’snotjustthepaceofbusinessthat’schanged–it’severythingfromcustomerexpectationstocompetitivelandscapes.

87percentofCSCOssayitisextremelydifficulttopredictandmanagedisruptions

AccordingtoIDC,33percentofallmanufacturingandretailcompanieswillbedisruptedbydigitally-enabledcompetitorswithinthenextthreeyears.1

Todaymorethanever,businessesmustevolvetostaycompetitive.Savvyleadersarelookingtotheirsupplychainstodotheheavylifting,drivingdifferentiationthatimpactsquality,delivery,costs,customersatisfactionandmore.

CSCOscitealackofvisibilityas

thekeyhurdleinmitigatingdisruptions:

Infact,84percentofCSCOscitelackofvisibilityastheirbiggestchallenge

Yet,mostbusinessesareoperatingwithsupplychainsystemsbuiltinadifferentera.Theystruggletomakesenseofanoverwhelmingamountofdatascatteredacrossdifferentprocesses,internalandexternalsources,andsiloedsystems.Theystrugglewithvisibility,andwithconnectingandexchangingcriticalinformationacrossanincreasinglycomplexecosystemofpartnersandsuppliers.

Lessthan10%oftoday’ssupplychaindataiseffectivelyused,andmostcompaniesarevirtuallyblindtothe80%ofdatathatisdarkorunstructured.Withtheselimitations,itisdifficulttooptimizesupplychainoperations–andthebusinessisexposedtounnecessarydisruptions,delaysandrisks,aswellasincreasedcosts.

1. TheThinkingSupplyChain,IDC,March2017

Page2 BuildingaSmarterSupplyChain

ANewEraofSupplyChainVisibility

“AIandblockchainaretransformativetechnologieswhichpromisetochangethewaybusinessesandindustriesoperate,particularlyintheirmanagementofsupplychainandabilitytoadaptbasedondemand.”

—JeanetteBarlow,VicePresident,OfferingManagement&Strategy,IBMSterling

Westandatasignificantinflectionpointintermsofdisruptivetechnologies.AI,Blockchain,theCloud,DigitalBusinessNetworksandIoTholdincrediblepotentialtoradicallytransformbusinessandthesupplychain.

Forexample,AIcanrapidlyandcomprehensivelyread,understandandcorrelatedataatincrediblescaleandspeed.It’sagame-changerincapturingandunderstandingallthedataavailabletoyourenterprise–andthencuttingthroughthedata“noise”toprovidereal-timeanalysisandactionableinsights.WithAI,youcanexpandtheuniverseofvaluabledatasourcesavailabletoyourenterprise,andincreasetheusefulnessofthat

data.

By2021,one-thirdofmanufacturersandretailerswillbetrackinggoodsusingblockchain-IDC

Blockchainisideallysuitedtolargenetworksofdisparatebusinesspartners.Byprovidingasingleversionofthetruththroughasharedledger,blockchainincreasestrustand

efficienciesacrossthenetwork,whichiscrucialineliminatingandresolvingdisruptionsanddisputes.Withblockchain,transactionrecordsareimmutable(ortamperproof)andsecure,agreeduponbyallpartiesandeasilyreferenceable.Italsocreatesasharedaudittrailforusebyeveryoneinthepartnerecosystem.

Bytheendof2020,one-thirdofallmanufacturingsupplychainswillbeusinganalytics-drivencognitivecapabilities,thusincreasingcostefficiencyby10%andserviceperformanceby5%

Together,AIandBlockchain,EmpowertheSupplyChainto:

Gainend-to-endsupplychainvisibilityacrosssystemsanddatasources

Retrieveandcorrelaterelevanttransactionaldata90%fastertogaincriticalinsights

Improvecollaboration,gainefficienciesandreducecosts

Reducetimetovaluebyatleast85%

Proactivelypredictandmitigatedisruptions

Reducemitigationtimefromdaystominutes

PlanandarchitectforthefuturewithAIandblockchain

BuildontopofcurrentITinvestmentsandrealizevaluequickly

Page3 BuildingaSmarterSupplyChain

FoundationsforBuildingaSmarterSupplyChain

Asmartersupplychain,poweredbyAIandblockchain,providesgreatervisibilityandinsightsintotheend-to-endsupplychain–includingthetransactionallifecycleandpartnerecosystem.ItleveragesthepowerofAItoconnectandcorrelatedatafromdisperseanddisparatesystemsandsources,andsortsthroughdataoverloadtoprovidenewinsightsandrelevantalerts.Itcomplementsandelevatesexistingsystemsandinvestments.

AIcanalsohelpyouproactivelypredict,assessandmitigatedisruptionsandrisks.Asmartersupplychainthatleveragesthistechnologybuildssignificantlymoreresiliencyandresponsiveness.

Leadingcompaniesarelearningfirsthandhowthesedisruptivetechnologiesenableimprovedefficiencyandreducedcosts.Theyrepresentaneweraofsupplychainmanagement,complementingandelevatingexistingsolutionsacrossplanning,sourcing,inventory,fulfillment,logisticsandsupplyassurance.

WhenyoucombineAIandblockchain,theimpactisexponential.Supplychainsolutionscanembedthesetechnologiesinmeaningfulways,suchasto

driveimprovedinsightsandusabilityofthevastdataaffectingsupplychainorganizations.Fromcorrelationandanomalydetectioninbusinesstransactions,togaininginsightsbytappingintointernalandexternaldatasources,withthesetechnologiesorganizationscanproactivelygetaheadofevents.WhenAIandblockchainarecombinedtheycanenableapowerfulplatformthatprovidesbothasourceofshared,immutabledataforsuppliersandpartners–withthecapabilitytoimmediatelyidentifytradingpartnerbehaviorsandevents.

Thecompaniesreferenced[below]inthesecasestudiesareallearlyleadersinimplementingAIandblockchain.Allofthemsoughttobethedisruptorintheirindustry,ratherthanbedisrupted.Theyeachwereabletobuild,withthehelpofIBM,capabilitiesleveragingtheirexistingsystemsandapplicationstodriveimmediatevalueinspecificusecasesprioritizedbythebusiness.

GainEnd-to-EndVisibility

Illuminatethe80%ofdatathatisdarkandunstructured

Quicklycorrelateandunderstanddatafromacrossdisparatesystems

Sortthroughdataoverloadandgainnewinsights

Establishsharedvisibilitywithpartnersandkeysuppliers

MitigateDisruptionsandRisks

Proactivelypredict,assessandmitigatedisruptionsandrisks

Reducedisruptionmitigationtimeandrelatedcosts

Retainknowledgeandbestpracticesforfuturereference

HelpcutdisruptionsinhalfwithAI-enabledsmart-alertsandpredictivecapabilities

Page4 BuildingaSmarterSupplyChain

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5

BuildingaSmarterSupplyChain

Fortune500CompanyLeveragesAIforGreaterVisibility,ImprovedOrderManagement

Aleadingindustrialautomationcompanylackedvisibilityintoitsend-to-endsupplychain–andspecificallyintoinboundsupplydeliveriesanddelays.Thismadeitdifficulttoeffectivelymanagecomplexoutboundordersandmeetcustomershippingandbundlingpreferences.ThecompanycapitalizedonAItoprovideaconnectedviewacrosstheirsupplychainandgaingreatervisibility

intomulti-componentorders.IBM’sAIsolutionhelpedthecompanyeffectivelymanagedataoverload,providingalertsforlate-deliveriesaffectinganycomponentinabundledorder.Inashorttime,thecompanyquicklytrainedtheAIsolutiontoassessorderstatusandfinancialrisk,soissuescouldbeprioritizedandresolvedbeforetheyimpactedcustomerdelivery.TheyalsousedAItosortthroughunstructureddatafromexternalnewsandsocialmediafeedstogetabetterunderstandingofmarketandsupplychangesthatcouldleadtodelays.Theresult?Clearvisibilitytomanagecomplexcustomerordersandsignificantlyimprovedorderdeliveryandquality.

“WhatyoujustsawAIdoinsecondstypicallytakesmehoursforeachquery...hugetimesavingsopportunity.”

DataAnalyticsLeader,Fortune500IndustrialAutomationCompany

BlockchainDrivesBigPharmaCompany’sCollaborationwithPartners

Aglobalpharmaceuticalcompanyhadlimitedvisibilityacrosstheirpartnerecosystem,whichledtoinefficienciesinmeetingcustomerdemand.Theyinteractedandworkedwithatleast20intermediariestoobtainandtransportsuppliesandproductstomeetcustomerdemand.Eventhoughblockchainisinitsinfancy,thecompanybeganexploringhowtoapplythetechnologytokeeptradingpartners

onthesamepageanddrivecollaboration.Theyestablishedasharedledgerforallpermissionedtradingpartnerstoprovideaccesstotransactionaldatainrealtime.TheyalsoplantoleverageIoT-basedshipmenttrackingdatatoallowpartnerstomonitorthelocationandconditionofshipments.Withablockchainnetwork,thepharmaceuticalcompanyanditstradingpartnerscanestablishashared,singleversionofthetruth–fromorderinceptionthroughfinaldelivery.Thecompanyexpectsthistoimprovecollaborationandeliminateblindspots,uncertaintyandinefficienciesacrosstheirpartnernetworkandsupplychain.

MasterLockUnlocksBusinessTransactionIntelligencewithAI

MasterLock,acompanythatdevelopsandmanufacturessecurityproducts,wantedtoprovideitsinternalbusinessuserswithself-serviceaccesstoreal-timedataabouttransactionstobettersupportcustomers,suppliersandfinanceprojects.ThecompanypartneredwithIBMtoimplementanAI-powered,BusinessTransactionIntelligencesolutioncombinedwiththeirIBMSterlingSupplyChainBusinessNetwork.Ultimately,MasterLocknotonlyachievedtheexpectedresultsofenablinguserstomoreeasilyfindandtrackbusinesstransactions,theywerealsoabletoquicklyidentifyandrectifyinefficienciesintechnicalEDIprocessingwithpartners.

“BusinessTransactionIntelligencewillallowourCustomerServiceandFinanceteamstoeasilytrackanorderfrominceptiontocash.Itwillallowthemtoperformtheirdutiesinamuchmoreefficientmanner.”

—ConnieRekau,EDIManager,TheMasterLockCompany

LenovoLeveragesAIandBlockchainforSupplyChainTransformation

Lenovo,aglobaltechnologyandmanufacturingleader,wantedtoestablishgreatervisibilityacrosssystemsanddatasourcestominimizedisruptionsandimprovecustomerordermanagement.TheywantedtouseAItoconnectdisparatesourcesofdataandgaingreaterinsightsintotopcustomers–andtocorrelatedatafromothersystemswiththeirordermanagementsystemstoimprovedeliveryandcustomersatisfaction.Injustsixweeks,IBMdemonstratedaproofofconceptforAIapplicationusingtheirowndata–andstarteddowntheroadtogreatervisibilityandreducingdisruptions.

“IBMSupplyChainInsightshelpsorganizationsleveragethepowerofArtificialIntelligencetogaingreatervisibilityandpredictiveinsightsacrossthesupplychain.Ultimately,thatvisibilityandinsightcanhelpdriveaction,efficiencyandincrementalrevenue.”

–BobbyBernard,GlobalProcurementandSupplyChainExecutive,Lenovo

AutomotiveManufacturerFocusesonCostReductions

Amajorautomotivemanufacturerwantedtoreduceinventorycostscausedbyhighsafetystocklevels.Toachievetheirgoal,theyneededgreaterdataaccuracyandbetterinsightintowhat’shappeningduringtransport.ByleveragingAIandIoTdatainshippingcontainers,theycannowpredictlatearrivalsbasedonrouteperformance,trends,carrierperformance,andweather.TheyalsousedAItoeffectivelymanagedataoverloadandgeneratesmartalertsbasedonsensitivitythresholds.WithAI,theyoptimizedinventorydowntotheshippingcontainerlevel,realizedfasterresolutionofeventsimpactingtimedeliveryofparts,improvedpredictionofdelays,andsignificantlyreducedneedforsafetystocks.

“WearespendinghundredsofmillionsonunnecessaryinventoryandseeAIasthebestpathtogeneratetheinsightstocreateaseamlessprocesstoeliminatewaste.”

SeniorSupplyChainExecutive,MajorAutomotiveManufacturer

IBMSterlingSupplyChainSolutionstoDriveVisibilityandManageDisruption

OursolutionsleveragethepowerofAIandblockchaintohelporganizationsarchitectforthefutureandbuildasmartersupplychainthat’smoreresilient,agileandcustomer-centric.

IBMSterlingSupplyChainInsightswithWatson

IBMSterlingSupplyChainInsightswithWatson(SCI)leveragesAIthatlearnsandunderstandssupplychaintoprovidemonitoring,visibilityandinsightsacrossyoursupplychain.WithSCI,organizationscanbeproactivelyalertedto,andbetterassessandmitigate,disruptionsandrisks.

SCIOperationsCenterwithSmartAlertsproactivelymonitorsandgovernsoperationswithspeedandagility–andprovidesconfigurablealertstocutthroughdataoverloadandpredictpotentialdisruptions.SCIResolutionRoomswithAskWatsonrecommendstherightteammemberstohelpresolvespecific

disruptions,andthenprovidesthatteamwiththerelevantinformation,updatesandinsightsneededtomitigatetheevent.DigitalPlaybooksareanorganizedbodyofknowledgeandbestpracticesbuiltovertimebasedonyourpastactivitycuratedbyWatson.Thisknowledgebasewillhelpyoutacklerecurringsupplychainchallengeswithgreaterefficiency.

SterlingSupplyChainBusinessNetwork

StreamlinecollaborationacrossyoursupplychainanddeliverAI-poweredB2BtransactionvisibilitytobusinessuserswithIBMSterlingSupplyChainBusinessNetwork(SCBN).Asingle,cloud-based,digitalbusinessnetwork,SCBNenhancescollaborationwithyourcustomers,suppliersandtradingpartnersbydigitizingandautomatingB2Btransactions,whileaccommodatingspecificbusinessrequirements,governmentregulationsandtechnicalcapabilities.

SCBNprovidesbusinessuserswiththeinsightsneededtomakefasterandmoreinformeddecisionsbyleveragingAItodeliverdeepsearchandvisibilityintoB2Btransactionlife-cycles,visualizetheentirelife-cycleofatransactioninreal-timeandincontext,ordrilldowntoseethegranulardetailofspecificdocuments.

IBMSterlingDeliveryTransactionIntelligence

IBMSterlingDeliveryTransactionIntelligenceisaportfolioofapplicationsthatbringsblockchaintotheSterlingSupplyChainBusinessNetwork.SterlingDeliveryTransactionIntelligencegivesyouasinglerecordoftruth,completewithtransparentimmutability,datarights,anaudittrail,permissionandprivacy,andasecurity-richenvironment.

SterlingDeliveryTransactionIntelligenceensuresthatalltheparticipantsinsupplychainprocessesstayinformedandconnectedoneventsandchangesinbusinesstransactionsfromordertodeliverywithoutcompromisingsecurityorconfidentiality.Withasingle,sharedviewofevents,partnerscanquicklyandeasilyresolveissuesandpotentialdisputes.

CopyrightIBMCorporation2019|IBMCorporation,Route100,Somers,NY10589|ProducedintheUnitedStatesofAmerica|October201

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