AI Poised to Transform Supply Chain Planning, ISG Says

AI is quickly ushering in a new era of supply chain planning, motivating enterprises to consider the best available strategy and software to gain a competitive advantage with the technology, according to new research from global AI-centered technology research and advisory firm Information Services Group (ISG) (Nasdaq: III).

The ISG Buyers Guides for Supply Chain Planning, a new portfolio of reports by ISG Software Research, provides the rankings and ratings of 22 software providers and their products to support supply chain planning. The research finds that AI and generative AI will have profound effects on both large and midsize enterprises, including retailers, that adopt them for supply chain planning over the next decade. Companies with even moderately long and complex supply chains must decide how and when to apply AI and GenAI to their planning processes. Selecting the right provider will be a key part of the transition.

“Supply chain challenges remain the same, but the tools for addressing them are changing,” said Robert Kugel, executive director, Business Research, ISG Software Research. “The emergence of AI will mark a turning point in how companies build intelligent, efficient supply chains. It will separate the winners from the also-rans.”

Supply chain planning software helps enterprises maintain resilient operations in several ways, the report says. By improving the accuracy of demand forecasts, often with advanced algorithms and machine learning, it enables retailers and other companies to anticipate customer needs and improve order fulfillment. It can also identify potential risks and disruptions in the supply chain and simulate various scenarios to help companies plan for contingencies. Real-time data and insights help enterprises make informed decisions faster, and improved collaboration keeps organizations aligned across functions and geographies.

AI and GenAI have the potential to expand these benefits, substantially reducing the cost and human effort that goes into supply chain operations, ISG says. These technologies can help companies quickly juggle diverse supply and demand objectives and constraints, enabling continuous supply chain planning through even better cross-functional collaboration. Ultimately, AI advances should lead to event-driven analysis and suggestions that trigger actions, allowing enterprises to stay ahead of emerging developments.