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Inventory optimisation and artificial intelligence

Author: Ian Warburton

When it comes to inventory optimisation, Artificial Intelligence (AI), also know as Machine Learning (ML) have the potential to create systems which are self-balancing; optimising parameters, as requirements change with the passing of time, to create a system which really does know best.

machine-learning

Many companies, large and small, struggle with the challenges of inventory optimisation and the selection, appropriate setup, configuration and running of Enterprise Resource Planning (ERP) or Sales & Operations Planning (S&OP) systems often has a significant part to play in this. AI may enable the creation of an holistic optimisation, possibly of more than just inventory, based on new big-data approaches. But AI also creates the possibility that such systems may become a more complex and impenetrable ‘black-box'. In with case users may be left at the mercy of the mysterious operations within and unable to challenge outcomes - as the system knows best.

For now, AI is yet to be well-regarded as a stable approach; Gartner’s Hype Cycle report* places it on the ‘peak of inflated expectations’. With that said, Machine Learning is a hot topic and it is being applied to nearly every business problem - no doubt we will see more of what it can offer inventory optimisation in the near future.


For more on the challenges of getting inventory optimisation right, take a look at our recent paper:

Download the guide to Inventory Optimisation

If you are interested in learning more about Machine Learning and AI, then check out our introductory guide:

 What is Machine Learning and how can it improve performance?

*Gartner Hype Cycle for Supply Chain Planning Technologies, 18th December 2017

The Unipart Way: performance improvement that sustains

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