Inside Supply Management with Nate Powrie
Sue Doerfler is Senior Writer for Inside Supply Management® and she interviews Nate Powrie, Managing Director, Data Analytics for SGS Maine Pointe.
November 21, 2023 - It’s the dawn of the age of artificial intelligence (AI). Big data was so last decade. Generative AI — a large language model that is able to create new data and content based on what it has learned from the content it’s already absorbed — is the latest craze. And it’s a game changer, says Nathanael Powrie, managing director, data analytics at SGS Maine Pointe, a global supply chain and operations consulting firm.
“Over the next 12 months, in my opinion, this will become the fastest technology in our recent lives,” he says. “It’s going to transform not only consulting, not only manufacturing, not only technology companies, but also will be adopted everywhere in our daily lives.”
Pilots and Benefits
As the next evolution of technology, generative AI is something that all companies, no matter the industry, can benefit from. But first they need to develop a plan, Powrie says. To be most successful and competitive, it’s critical to establish a timeline, determine where generative AI can make the most difference and set up a pilot to test the waters.
“Determine which areas within the supply chain are going to be the biggest ROI opportunities to harness this,” he says. And ensure there is ample pertinent data — “because success is still hindered based on the quality of data,” he says.
Powrie recommends spending no more than several weeks identifying where to set up pilots and the why behind them. Put boundaries on what you’re trying to solve for using AI. Focus on one area at first.
“Accounts payable and purchasing are two of the hottest areas of opportunity,” he says. “But we’re also starting to use this in sales and operations planning,” with companies focusing on ROI in such areas as inventory control. “There are a lot of tools coming to the marketplace that are set up for innovation,” Powrie says.
Generative AI can help organizations reduce manual tasks, freeing employees for more valuable work. For example, let’s say a company wants to use a business intelligence platform to learn more about the distances between its customers and its warehouses. The platform’s AI assistant can determine which customer location is closest to a warehouse. But it doesn’t give the average mileage from customers to all warehouses.
“Generative AI has access to create those mileage points,” Powrie says. “You just type the question, and you could get a response that your average customer distance to a warehouse is 16 miles.”
Generative AI also can increase data granularity and visibility. SGS Maine Pointe has found that Infusing AI into
its total value optimization (TVO) model has offered valuable results. “In a project that involved sifting through more than 350,000 invoices, generative AI enabled us to efficiently extract and classify line- item level data,” Powrie says.