Advanced thinking: AI and disruptive technology in supply chain planning

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Johnson & Johnson’s Neil Ackerman explains the bold, new world of advanced planning where AI and advanced data create a new way of thinking

Advanced planning is going through huge changes – it’s challenging every bit of what people know, or think they know. Everyone wants innovative technology to work for them and advanced planning is the driver for the closed-loop process that allows end-to-end synchronisation in the supply chain. Without it, nothing operates effectively in the disruptive environment, which underlines the importance of integrating planning of customers, technologies and business models. To make it all come together, business models are all changing, and supply chains too.

Technology is at a tipping point – all of these six disruptive technologies will be broadly adopted within the next decade.

  • Internet of Things

  • Advanced robotics

  • Artificial intelligence / big data

  • Augmented / virtual reality

  • Sensors and signals

  • 3D printing automation

A world of change for planners

Just like the tech companies 15-20 years ago, the more established companies are going through that transformation now. In the past, planners just provided guidance on what to do, but now the future people initiate the actions of what to do.

In the past, planners accepted the explicit responsibility, on a case-by-case basis, like a system of record, but now planners totally accept the implicit responsibility because they’re using innovation and differentiation of the system. In the past, they did batching, were part of inflexible, steady-state systems that were linear, and were mostly demand-focused. But now, the future is about concurrent, continuous planning, risk-aware, real-time automation. The examples of the past were linear, concrete and siloed demand plans, siloed inventory plans, siloed supply plans, even siloed exception plans. Today they are auto event-driven monitoring.

Adapt or fail: what big businesses do next

Consumer Product Goods companies must embrace change now. They will be made fun of 10 years from now as the people that said, “that’ll never happen.”

Every time someone tells me the world is over-estimating the impact of the internet, e-commerce and consumer preference, and that big brands will always win, I tell them that they’re so wrong. It’s been proven so many times already that the internet changes everything.

Why aren’t they changing? People want to believe where they work is the best, and they should believe that, but sometimes they get blinded by being in that industry for 30 years.

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Being a leader in the disruptive era

Today, the difference is made by collaboratively leading a group of really smart people to initiate the digitization of our planning. So if you’re very bright in robotics and IoT, sensors, automation and AI, you are part of the transformation. If you know all those constituent parts, you’re helping to build that road for the company. You’re one person laying down the concrete for that road to happen. But as everyone knows, there’s always someone who knows each part of the road – laying the concrete, painting the lines, doing the measurement. You work with a lot of people who may have expertise deeper than you, in one of those transformations, but because you have knowledge across all six, you’re never lost, you’re in the game across the entire process.

Mission control: talent acquisition is changing

To get all that done, your planning team must evolve. The evolution of the talent strategy for disruptive digitization is very different to what it was even 24 months ago. Finding people with knowledge and expertise in these disruptive technologies is difficult, particularly in established industries.

In all six areas, there are very few people that know much about it. It’s interesting that a lot of people who would have done it, and then implemented the digitization of supply chain, ended up working at companies that didn’t exist 20 years ago – Google, Facebook, Amazon. All this knowledge, all these people that historically would have joined the major supply chain operators (the food companies, the pharmaceuticals, car industry) ended up somewhere else. Overall it is a recruiting gap, because the people that would have been their leaders, that would have come up through these established companies, all went to the tech and finance companies where digitization was already taking place.

Every generation in history wants to make a difference to the world

 

At Johnson & Johnson, we’re one of the world’s largest healthcare companies, so people see how they can positively influence patients’ health. How? We’re working to implement signals and sensors, build artificial intelligence modeling, trying to learn how the IoT can interact with patients. These are significant challenges that become very exciting in recruiting people.

It’s amazing that a company that’s more than 100 years old, like J&J, is at the forefront of digital transformation across customers, technologies and business models. They know they can contribute to the greater health of the world. We know that distribution and inventory can help patients get the medicines they need, at the time they need them, and that’s a compelling story for them. In any organization, communicating that mission is crucial to recruiting. Every generation in history wants to make a difference to the world.

 

ABOUT THE AUTHOR

Neil Ackerman is the Senior Director, Global Supply Chain Advanced Planning, for Johnson & Johnson across all segments including Pharmaceuticals, Biomedical Devices and Consumer Products. He is responsible for accelerating supply chain innovation and enablement of advanced planning processes and technologies worldwide. His team is critical in bringing value-based prototyping to life.