The power of ‘good enough’

During a panel discussion on the future of artificial intelligence (AI) in supply chain management, I recently heard Brian Tomlin, a professor of supply chain management at Dartmouth College, make a refreshing and perhaps even liberating statement. He suggested that, for most companies, a ‘good enough’ supply chain is more than sufficient. This remark came up during a debate on whether AI would improve all kinds of decision-making in supply chains.

While case studies from a wide range of companies – retailers such as Walmart, fashion giants like Zara, European FMCG manufacturers – are full of impressive examples of how AI enhances decision-making, the actual performance gains are often modest: usually less than 10 per cent.

However, these modest performance gains may be accompanied by labour savings, thereby helping to address the tight European labour market – a challenge facing many companies. These companies with ‘supply chains excellence’ view that excellence as a crucial competitive advantage and are therefore investing heavily in advanced systems such as AI agents to capitalize on every efficiency gain.

This story was originally published by Supply Chain Movement. Read the full story at Supply Chain Movement →