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Pioneering the future: Supply Chains, Reverse Logistics and AI

Steven B. McKinney | 24. syyskuuta 2024

The convergence of supply chain, reverse logistics and artificial intelligence (AI) is reshaping the global business landscape. Cybage Software is a leading Information Technology company specializing in Digital Product Engineering Services. With over 29 years of experience, providing comprehensive digital product engineering solutions to technology-focused businesses worldwide, Cybage Software's award-winning services span the entire software and technology product lifecycle (PLC) and product revamp.

As businesses navigate this evolving landscape, industry leaders provide valuable perspectives on harnessing these technologies for success. Steven B. McKinney, Managing Partner at Kestria South Korea, interviewed David Houser, Global EVP of Cybage Software, who shares his insights on AI and technology's role in driving business transformation. 

'It's a privilege to be part of this conversation. The rapid pace of change in the business world demands innovative solutions and I believe that technology, particularly AI, is at the forefront of driving this transformation,' says David Houser.

The Global Supply Chain

The global supply chain has experienced unprecedented disruptions in recent years. How has Cybage Software helped clients navigate these challenges and build more resilient supply chains?

The pandemic exposed vulnerabilities in traditional supply chains, forcing businesses to rethink their strategies. We helped clients build resilience by implementing advanced analytics, AI-powered forecasting and digital supply chain platforms. A key focus was on creating greater visibility, agility and responsiveness. For example, we assisted one of our clients in developing a digital twin of their supply chain, allowing them to simulate different scenarios and identify potential disruptions proactively.

Can you elaborate on the role of technology in building resilient supply chains?

Sure, and there are many, but let me focus on something specific that will be increasing in demand as we move forward. But first, a quick real-life story. Steve, do you know what happens to chickens that are mass-produced for export to China for example from the US in 46 days? Maybe a laugh, or a genuine guess here, but the answer is millions more chickens are ready for mass export. COVID forgot to tell the chickens to take a break or slow down!

The challenge here was complex. Our supply chain in this example was efficient if chickens were loaded on a vessel from the US and sent to China. But when the vessel was unable to return – stock in the water, chickens spoiled AND we did not have sufficient visibility into our supply chain in our backyard to move these chickens around the corner as easy as around the world. So, easy solutions like visibility, flexibility in case of this, or the Panama Canal getting a traffic jam, or geo-political issues that mandate different routes, modes of transportation, pricing, available to promise, etc.

As AI mixed with both hardware and software emerge, that is the point that is very exciting and interesting. Robots in the warehouse are becoming smarter, they can “see” better, they are faster and for now, they help the associate in the warehouse make their job more satisfying. Using voice-activated prompts with a (Locus is a leader and I know they would allow me to use their name, GEEK+ is out of Beijing and I am not sure about them) headset, followed by a robot allows both human and robotic assistance a faster, more efficient way of picking, for example, the item that will travel around the world. This has been and surely will become more and more used within the warehouse. Already, 3PLs are celebrating that they have 1+ billion picks with the use of robots.

A trillion is not far away and the more sophisticated use of robots in situations that are difficult or dangerous for humans as well as situations prone to manifestations, this technology has already made for a better supply chain. Robots as a service (RAAS) will continue to interact, if not compete with human tasks… but let’s leave that for another conversation!

Technology is a cornerstone of supply chain resilience. AI, IoT and blockchain enable real-time visibility, predictive analytics and automated decision-making. For example, AI-powered demand forecasting can help businesses anticipate fluctuations and optimize inventory levels. Blockchain can ensure transparency and traceability throughout the supply chain, mitigating risks and building trust with customers. 

Is an immutable transaction with the help of blockchain and AI possible?

I think so! What concerns me is with the larger amounts of data, value and global demand, the opportunity for the bad guys to get involved will always be something we need to keep a close watch on and develop boards and standards committees for this. AI will be the most fundamental change in technology and humankind since the printing press, electricity and the internet!

Sustainability is becoming increasingly important in supply chain management. How can companies integrate sustainability into their supply chain operations?

Sustainability is no longer a choice but a necessity. Companies must adopt circular economy principles and reduce their environmental impact. By leveraging technology, businesses can track carbon emissions, optimize transportation routes and identify opportunities for waste reduction. Additionally, building strong relationships with suppliers who share sustainability goals is crucial. Implementing sustainable sourcing practices and considering the entire product lifecycle can help companies achieve their environmental objectives.

Reverse logistics

Reverse logistics has gained significant attention in recent years. How can companies transform returns from a cost center into a profit center?

Reverse logistics presents a significant opportunity for businesses to enhance customer satisfaction and drive revenue. By treating returns as a valuable source of data and potential revenue, companies can optimize their reverse supply chain operations. Technology can play a crucial role in automating returns processing, enabling product refurbishment, and facilitating remarketing. Additionally, implementing a circular economy approach can help businesses extract maximum value from returned products.

What are the key challenges in implementing effective reverse logistics strategies?

Some of the key challenges include managing returns complexity, optimizing transportation and warehousing, and preventing fraud. To address these challenges, companies need to invest in robust technology solutions, develop clear return policies, and foster strong relationships with logistics partners.

The impact of AI and Gen AI

AI is rapidly transforming industries. How is Cybage Software leveraging AI to drive innovation and create value for its clients?

AI is at the core of our innovation strategy. We are applying AI across various domains, including supply chain optimization, customer experience, and product development. For example, generative AI is enabling us to create highly personalized customer experiences, while AI-powered predictive analytics is helping businesses make data-driven decisions.

How do you see the future of AI evolving and what are the potential implications for businesses?

AI is advancing at an unprecedented pace. We can expect to see even more sophisticated AI models with enhanced capabilities. However, it's crucial to address ethical considerations and develop responsible AI practices. As AI becomes more integrated into business operations, upskilling the workforce will be essential to maximize its benefits.

Can you elaborate on the challenges and opportunities associated with AI adoption?

While AI offers immense potential, it also presents challenges such as data privacy, bias, and job displacement. It's essential to invest in AI talent, develop robust data governance frameworks, and prioritize ethical considerations. By addressing these challenges, businesses can unlock the full potential of AI and drive sustainable growth.

About Cybage Software

Cybage Software is a global leader in Digital Product Engineering Services, specializing in providing comprehensive solutions for businesses across various industries. With a focus on innovation and technology, Cybage offers services in AI, cloud computing, big data, and digital transformation. The company leverages its proprietary ExcelShore® platform to ensure efficient and effective service delivery, helping clients achieve maximum ROI. With over 29 years of experience, Cybage is dedicated to driving business success through cutting-edge technology and strategic partnerships.

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