Your Digital

Transformation
Partner
Executive Summary

The transformative power of artificial intelligence is

being leveraged by retailers and e-commerce
companies to create next-generation supply chain
systems that are better aligned with new market
realities. Artificial Intelligence is changing the way
businesses serve their customers and has the
potential to drive substantial improvements and shape
the future of everything today.

This document includes how the use of AI in the

supply chain can help create a more efficient delivery
ecosystem with seamless flow of products and
information across the network.

[email protected] | www.payoda.com
Introduction
AI systems are becoming a key part of IT infrastructure and all enterprises need to
understand and plan for the adoption and use of these technologies in their organizations.
The key is to utilize the power of AI and alter the way ecommerce operates and create better
customer experience.

AI empowers business leaders

with valuable insights that
enable them to take smarter
business decisions. It helps
retailers collaborate more
effectively with suppliers and
customers

[email protected] | www.payoda.com
Increasing digitization of businesses has led to the emergence of new operating models
that require a new approach to doing business. Online retailers and e-commerce
companies are looking for innovative ways to streamline their delivery processes and
supply chain networks. Hence it is not surprising that the next wave of automation is
being driven by artificial intelligence (AI). The transformative power of artificial
intelligence is being leveraged by these companies to create next-generation systems
that are better aligned with changing market realities.

Artificial intelligence technologies such as robotics process automation, machine

learning, data mining and cognitive computing have the ability to significantly enhance
business processes and take productivity to a much higher level. AI empowers business
leaders with valuable insights that enable them to take smarter, more informed
business decisions. It not only helps retailers refine their existing products and services
but also allows them to collaborate more effectively with their suppliers, partners and
customers.

An IDC report¹ estimates that the global spending on cognitive and AI solutions will see
significant corporate investment over the next several years, achieving a compound
annual growth rate (CAGR) of 54.4% through 2020 when revenues will be more than $46
billion.

[email protected] | www.payoda.com
According to the report, intelligent
applications based on cognitive
computing, artificial intelligence, and
deep learning will form the next wave
of technology-led transformation.

[email protected] | www.payoda.com
Transforming the Supply Chain

The use of AI in the supply chain can help create a more efficient delivery ecosystem
with seamless flow of products and information across the network. Intelligent
navigation and greater visibility across the supply chain facilitates accuracy in demand
forecasting, planning and inventory management. The massive amount of data
generated in the supply chain can be analysed to gain a better understanding of
customer requirements. The advantages are not just restricted to cost savings or
process improvement. Intelligent automation ensures significant enhancement at every
level in the supply chain, thus taking it to a much higher level of maturity.

Taking SCM to the Next Level

The massive amount of data generated across the supply chain can be converted into
actionable insights with the help of artificial intelligence.

[email protected] | www.payoda.com
[email protected] | www.payoda.com
Let’s take a closer look at some key areas where AI is making an impact:

1 Automation of Routine Tasks

A number of standardized activities such as collecting order information, generating
new requests or creating work orders can be intelligently automated to create a self-
organized supply chain that moves faster and is more efficient.

2 Demand Forecasting & Procurement

The large volume of data generated across the supply chain network can be analyzed to
drive efficiencies in demand forecasting, planning and procurement. AI not only
increases accuracy, but also enables cost reduction.

3 Logistics & Inventory Management

Intelligent automation is being increasingly deployed by companies to streamline the

movement of goods, both at domestic and international levels. This has brought about
a fundamental change in the management of logistics, inventory planning and
warehouse operations.

[email protected] | www.payoda.com
[email protected] | www.payoda.com
4 Interaction with Suppliers, Dealers
& Customers
AI-based systems can be customized and trained to interact with your suppliers or
customers in multiple languages. Many companies are using them at least for a first
level interaction as it helps improve the overall quality of services.

5 Product Development & Speed-to-Market

Improved collaboration with all stakeholders across the supply chain improves the flow
of products and related information which ultimately increases speed-to-market. A well
integrated supply chain also equips you with more accurate data about market
requirements. This data can be further analysed and interpreted for product
development and marketing functions.

[email protected] | www.payoda.com
[email protected] | www.payoda.com
Contextual Awareness for Smarter
Business Decisions

There is no doubt that intelligent automation of supply chain activities has a huge
impact on the overall efficiency and productivity of an organization. The benefits of
artificial intelligence, however, extend much beyond the warehouse, logistics or
fulfilment cycle. AI-driven disruption is defining the next stage of evolution in the supply
chain. In a survey² conducted by MHI and Deloitte, 51 percent industry leaders stated
that robotics and automation have the potential to either create competitive advantage
or be a disruptive force in their industry.

Increasing digitization of the supply chain is generating massive amount of data that
can feed into strategy, marketing, sales, and product development. The information
collected from customers, suppliers and other stakeholders can be interpreted to
improve “contextual awareness.” This means that we do not just restrict ourselves to
gathering demand data and responding to it. With the help of artificial intelligence, we
can dig deeper into this data to know the why, how, where and when of market
requirement. This complete picture or contextual awareness can lead to revolutionary
breakthroughs in planning and decision making.

[email protected] | www.payoda.com
Prescriptive and predictive modeling based
on past sales, marketing campaigns and
analysis of competitor events and related
data enables a far deeper understanding of
the market situation, which leads to more
efficient planning. Business leaders and
marketers get a better insight into what will
work and what will not. This obviously has
large-scale implications for e-commerce and
Industry leaders and early adopters of AI
retail businesses.
are already leveraging its potential in
different ways, from cross-selling A McKinsey report³ on ‘The Age of Analytics’
additional products to reducing costs states that an analytics or intelligence-driven
across the entire value chain approach has tremendous relevance for
retailers and some leading US companies
have even leveraged it to increase net
margins by as much as 60 percent. Some of
the industry-leading early adopters such as
Amazon and Walmart are already leveraging
this knowledge in a big way to create
smarter business models that put data to
work in everything from cross-selling
additional products to reducing costs
throughout the entire value chain.

[email protected] | www.payoda.com
Digital Disruption:
The Next Wave of Innovation

The focus of automation has so far been on

repetitive, transactional processes such as
planning and coordination. However,
increasing levels of digitization are creating a
new wave that focuses more on innovation.
The companies that are leading in digital
adoption, particularly online businesses, have
the potential to drive this digital disruption and
set new trends in AI adoption.

An Accenture report⁴ on ‘Digital Trendsetters:

Secrets of the Most Successful Supply Chains’
says that digital disruption is changing
markets everywhere at hyper speed. The
leaders termed as ‘digital trendsetters’ are the
ones who are leveraging their digital
investments to build new levels of
collaboration encompassing all stakeholders
in a proactively managed network. “By
engaging proactively across a broad and fluid
ecosystem, the digital trendsetters are driving
significant innovation,” reiterates the report.

[email protected] | www.payoda.com
As retail organizations look to reinvent themselves in this digital era, artificial intelligence can be
a key enabler or catalyst of change. AI will provide them the necessary agility and scalability,
helping them evolve towards a next-generation supply chain system.

[email protected] | www.payoda.com
Talk to us
Have an inkling of a thought you’d like to bounce off with
us? Have an idea you’d like to build on? Have a vision for
the future you need a partner for? Great! Let’s talk. You
can reach us at [email protected]

About Payoda
r
g

o
e
t
e

d
.

Sources:
1
Worldwide Semi-annual Cognitive Artificial Intelligence Systems Spending Guide , IDC , April 2017

2
MHI Annual Industry Report: Accelerating Change: How Innovation is driving digital “always-on” supply chains

3
McKinsey Global Institute: The Age of Analytics: Competing in a Data-Driven World, December 2016

4
Accenture Strategy – Digital Trendsetters: Secrets of the Most Successful Digital Supply Chains

5
McKinsey Global Institute: A Future that Works: Automation, Employment & Productivity, January 2017

[email protected] | www.payoda.com