IDC Predicts Half of Worldwide Supply Chains Will Use AI by 2020

By: IDC Manufacturing Insights
December 28, 2016

IDC Manufacturing Insights has published its "IDC FutureScape: Worldwide Supply Chain 2017 Predictions," report to offer the 10 predictions that provide the framework for IT and line-of-business (LOB) decision makers' and influencers' planning and execution of technology-related initiatives in the year ahead.

According to the report, over the next decade, IDC expects that a majority of manufacturing industry growth will accrue to those companies that engage successfully with their consumers. The number will vary by industry, with those companies that are inherently consumer facing seeing a much larger percentage of growth being tied to consumer engagement and those that are not seeing less growth. But in all cases, the ability to be "relevant" to consumers will be critically important to the majority of manufacturing segments,” says Simon Ellis, vice president of global supply chain strategies for IDC Manufacturing Insights. "The coming years will greatly alter the technology landscape for supply chain organizations. While the predictions offered here largely focus on the near term to midterm (2017 to 2020), the impact of many of these will be felt for years to come.”

It is worthwhile to note that predictions are not finite but rather occur on a continuum of change within the wider ecosystem of the manufacturing industry and global economy, he added.

The top 10 predictions are:

Prediction 1: By 2019, 50 percent of manufacturing supply chains will have benefited from digital transformation (DX), with the remainder held back by outdated business models or functional structures.

Prediction 2: By 2020, 50 percent of mature supply chains will use cognitive computing/AI and advanced analytics for deployment-based planning and to eliminate sole reliance on short-term demand forecasts.

Prediction 3: By the end of 2018, 90 percent of manufacturing supply chains will use B2B commerce networks as the dominant collaboration tool for demand, supply, service, and new product development.

Prediction 4: By the end of 2017, 35 percent of supply chains will be actively using supply chain control towers (SCCTs) integrated with expanded use of integrated business planning (IBP).

Prediction 5: By the end of 2020, 50 percent of all manufacturing supply chains will have the capability, either in-house or outsourced, to enable direct-to-consumption shipments and home delivery.

Prediction 6: By the end of 2019, 90 percent of manufacturing supply chains will use cloud applications within supply chain fulfillment to reduce complexity and increase speed and visibility.

Prediction 7: By the end of 2018, 75 percent of large enterprise manufacturers will have transitioned to capabilities-based procurement processes within their businesses.

Prediction 8: By the end of 2019, the use of sensors (IoT) for real-time information sharing across organizational borders will boost manufacturing supply chain productivity and efficiency by 30 percent.

Prediction 9: By the end of 2020, 50 percent of manufacturers will derive business value from the integration of supply chain, plant operations, and product and service life-cycle management.

Prediction 10: By 2018, technology-enabled risk and resiliency capabilities will have become a key element of value for 75 percent of manufacturing supply chains.