Tackling Supply Chain Challenges with AI and EAM Software
September 14, 2022
Since the COVID-19 pandemic began in 2020, supply chains have been impacted by unpredictable complications that continue to change the industry. These developments, coupled with increased demand in most industries, especially manufacturing, have made it more difficult for supply chain managers to predict and overcome setbacks as they arise. For example, shipping container prices increased by over $8,000 between March 2020 and February 2022, along with fuel and labor costs. Supply chain challenges such as these have led to clogged ports, labor shortages, and ultimately, increased shipping times and costs.
What are Some Common Supply Chain Challenges Manufacturers Face?
Additional supply chain challenges facing manufacturers include:
- Increased competition (easier to ship closer than farther)
- Raw material shortages
- Logistical, regulatory, and compliance concerns
- Insufficient data sharing between internal and external entities
Unfortunately, when these challenges arise, many companies are ill-prepared to adjust operations to overcome them. The supply chain is a complex amalgamation of different moving parts, so recovery is not swift when it buckles. Whether this causes a longer wait for customers or a higher price tag, this can hurt businesses’ reputations and drive customers to search for solutions with other companies. This can cripple an organization and cause irreparable damage. While nothing is written in stone, we predict that these changes and strains will likely continue and could even lead to significant financial losses, such as the $228 million estimated loss suffered by U.S. companies in 2021.
While it’s impossible to predict every change, a complete understanding of your asset inventory gives manufacturing companies a leg up for planning and handling emergency interruptions. Enterprise Asset Management (EAM) software powered by artificial intelligence (AI) can act like a third eye to monitor and digest sensor-derived internet of things (IoT) data to provide tangible asset insight.
Growing research supports the modernization of supply chain management. It indicates that those who modernize are more resilient to supply chain challenges—as with most modern upgrades, improving technology leads the charge in this supply chain revolution. Having a firmer grip on your inventory with EAM software can help avoid or minimize supply chain shortages or interruptions that will disrupt your business and inhibit an ideal customer experience.
How Does EAM Software Help Overcome Supply Chain Challenges?
Before your company implements a new technology, make sure you’ll benefit from purchasing and implementing fresh tech, as that isn’t always the case. There’s no point in spending money on something that isn’t built for the size or scale of your business. Suppose you don’t have AI-powered EAM software, for example, and the scale of your manufacturing operations is significant yet lagging in efficiency. In that case, you could likely benefit from such technology, and implementation would be appropriate. But if your operations are purely local, or your assets and supply chain are small, your business would probably not benefit from such software.
This principle can translate to any significant new purchase, as it’s always best to be sure an investment is needed before it’s made.
For supply chain issues, the perks of EAM or CMMS (Computerized Maintenance Management System) software include helping organizations monitor, manage and report on the state of all their critical assets. This way, maintenance can be preemptive about repairs and breakdowns without increasing operational costs due to avoidable issues. These systems also help manage physical company assets over their entire lifecycle through intelligent, AI-powered asset tracking. Improved tracking helps to maximize asset performance, increase ROI and workplace safety, and improve cost of ownership and overall operational efficiency.
Large-scale organizations with a lot of assets and logistics such as oil and gas, utilities, and transportation, as well as manufacturing organizations, particularly benefit from EAM software to support their industrial infrastructure, plants, equipment, operations, and ultimately—customer service and experience.
What are the Best Uses of EAM Software?
EAM software is helpful for accurate management of:
- Fixed plant assets such as those in power plants, manufacturing, and oil refineries
- Linear assets like power lines, rail, and pipelines
- Mobile and fixed fleet assets such as service equipment, vehicles, and rail cars
- Manufacturing equipment such as industrial ovens and conveyor systems
- Facilities assets such as elevators and security systems
- Construction assets such as cranes and tools
EAM systems can also help track the hours worked by your employees, helping to ensure everyone gets appropriately paid, even your remote workers—offering even more financial incentives for your business.
The most advanced technological solutions for supply chain optimization in manufacturing use AI algorithms. AI helps supply chain managers handle massive amounts of data and the changes occurring industry-wide by constantly utilizing machine learning (ML) to improve algorithms and their predictive capabilities. These algorithms offer a way to detect demand patterns with much higher accuracy and speed, dynamically simulate the company’s whole supply chain to show potential disruptions, and consider constraints to provide the necessary insights to create an optimal supply plan.
Let’s further explore the benefits of asset management and how incorporating AI-powered EAM software can negate supply chain slowdowns, improve your ROI, operational efficiency, and overall quality of customer service:
8 Benefits of AI-Powered EAM Software
- Reduce Supply Costs
AI-powered asset management can reduce supply and sourcing costs by analyzing fuel trends, increasing near-shoring to minimize transportation costs, and consolidating shipments by making freight schedules more efficient. Essentially, AI-powered management can predict the best move for your enterprise to make when sourcing and shipping, especially with rising fuel and raw material costs. While no solution can guess every outcome, especially in our post-pandemic environment, EAM software that is constantly improving through ML can help mitigate forecasting issues. Increasing overall asset visibility helps organizations have better predictive abilities—all of which reduce costs, improve ROI, and help avoid disastrous supply chain interruptions.
- Improve Vendor & Logistics Relationships
A looming supply chain challenge is delayed order fulfillment, which can be either the receiver or supplier’s responsibility. A lack of product could cause manufacturing delays, lowering ROI and customer satisfaction. A surplus could also hurt ROI, especially if companies don’t have sufficient space or demand to handle the extra product. Both conflicts could cause a souring of your relationship with vendors and should be avoided.
EAM software leverages AI to automatically give a supplier restock notice when necessary. This improves supplier communications and reliability for order fulfillment and payments—which mitigates supply chain disruptions.
- Reduce Equipment Downtime and Repair Costs
IoT sensors that power ML and AI technology are critical players in improving predictive maintenance, especially for asset-intensive industries. These intelligent sensors help generate real-time operational data so that anomalies can be observed and addressed before causing a more significant, expensive issue.
This data helps companies better plan and schedule services to avoid interruptions in manufacturing and is one of the most significant benefits of EAM software because of the time and cost savings this modern advancement provides. By avoiding maintenance issues preemptively, your company can avoid product shortages or shipping delays caused by a breakdown and ultimately keep the supply chain flowing as it should.
- More Accurate Overall Equipment Effectiveness (OEE)
EAM software helps develop a deep understanding of the reliability of equipment or assets from different vendors.
Since EAM systems are intelligent, they enable companies to store, track, and leverage information about asset vendors and payments, strengthening your understanding of external costs. Manufacturers can analyze historical asset and equipment maintenance records held in the EAM to determine which are continually malfunctioning. With this data, management can select a more appropriate and reliable vendor or equipment if necessary, lowering costs and increasing supply chain efficiency.
- More Efficient Maintenance Processes
With AI-enabled software, asset maintenance scheduling becomes automatic. Notifications can instantly be sent to the appropriate destination to initiate a repair if a parameter has been triggered. This saves time by negating the need for human intervention to diagnose an issue as well as the timely scheduling process of calling or emailing other entities to make a maintenance appointment. This ultimately helps prevent more extensive problems that could interrupt production and be even more expensive to repair down the line.
To avoid internal disruption, there are preemptive steps to take that improve your asset management, such as learning who the most dependable employees or vendors are, creating more detailed work orders, keeping more detailed records of physical assets that include pictures, and developing and implementing more effective and specific training materials for new and existing employees and vendors. You’ll be more equipped to defend against external supply chain interruptions by better controlling your internal processes.
- Better Quality Assurance
Enterprise asset management software can improve supply chain challenges by improving defect visibility among available assets, especially in manufacturing. IoT sensors can be leveraged as quality assurance agents to spot, trace, and diagnose where and why improper products are being made, leading to improved safety, preventative maintenance, regulatory compliance, and better quality products. To avoid supply chain interruption, it’s better to determine where mistakes are made before products reach customers, preventing dissatisfaction or even a recall.
- Unified Data Management
Data that is siloed is not easily accessible. By implementing EAM software, you can unify your data under one roof, which AI software can better access and utilize. Fragmented supply chains, especially global ones, are a recipe for disaster in today’s unpredictable environment. Avoid supply chain interruptions by increasing asset visibility from the assembly line to warehouses and through active shipments by housing all your data in cloud-based EAM software.
- More Secure Asset Data
When data is taken from multiple siloed locations into one unified database, there are fewer access points for external breaches, increasing security across all company data. These applications also increase internal security to ensure only correctly credentialed individuals are granted necessary visibility. Data security is more important than ever, so by using the most up-to-date EAM software, you can be better assured that you’re protecting your valuable physical assets and doing the same for your vital virtual assets—both of which are crucial to an uninterrupted supply chain.
Implementing EAM Software to Solve Your Supply Chain Challenges
Now that you understand the benefits of modern, software-based enterprise asset management, you can decide if your company could benefit from this technology.
If you’re ready to easily track, monitor, and improve your asset management, reach out to us today to get started with a demo of our leading cloud-based EAM software solutions.
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