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  November 28th, 2016 | Written by

IBM and the Cognitive Supply Chain

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  • IBM manages 30 billion a year of parts across its supply chain, and supports clients in 170 countries.
  • IBM is seeking to transform itself into the world's first cognitive supply chain.
  • Acting with speed in the face of supply-chain disruption knows is incredibly important.

IBM manages more than 30 billion a year of parts across its supply chain, and supports clients in over 170 countries, so the effort takes a truly global team.

To manage all those details and all that complexity, IBM is seeking to transform itself into the world’s first cognitive supply chain. It’s a plan that has big-picture implications, but which also has involved the implementation of specific applications that drive supply-chain processes.

“This is really about going beyond analytics, going beyond just being able to anticipate,” said Joanne Wright, vice president of IBM Supply Chain, in a recent podcast. “We’ve been doing some cool work on how we can really energize all aspects of our supply chain to that model.”

The company’s top supply-chain buzzword for 2016, is, not surprisingly, cognitive. For Wright, that means having the capability to have all of IBM’s supply chain systems not just think and learn, but understand.

“That starts to allow us to make much more educated and faster decisions,” she said.

One step IBM took in that direction was to acquire the Weather Company earlier this year.

“The Weather Company is one of the industry leaders in anticipating and dealing with extreme weather across the world,” said Wright. “And for us, we’d always focus on what could cause disruptions, and clearly weather can wreak havoc with anyone’s supply chain, both downstream and upstream.”

In this connection, IBM has been using its cognitive IT capabilities, called Watson, to incorporate Weather Company capabilities into supply-chain systems.

In one case, IBM was able to accurately predict when a hurricane was going to hit Guadalajara, Mexico, where the company has a manufacturing facility that services much of its hardware business into North America. Wright and her team were able to “make better and smart decisions.” “I think it really saved us a significant amount of cost, expense, and obviously ensured our clients continued to be delighted with our service,” said Wright.

The system is updated in real time with weather feeds and much more. Posts from social media, noted Wright, “really gives you the real information that’s happening in that country, in that location, at that point in time.” “So marrying that unstructured and structured data,” she added, “gives you a much better determined outcome.”

IBM has also deployed a mobile app called Transparent Supply Chain, which allows everyone in the company to see supply-chain challenges at a glance, whether it’s clients who may be having new demands and opportunities or back into the suppliers that service the business.

“It lets me see an alert at a glance of where I need to focus my attention and my energy that day,” said Wright.

Since everyone in the company is able to access it, “it truly has a transparent information capability,” said Wright. “So whether you’re a buyer or whether you’re in the manufacturing side, or whether you’re one of our suppliers, we’re seeing the same information, the same intelligence, the same data feeds, which allows us to be much more collaborative, and act with more speed. Which, as all of us who have faced any kind of form of disruptions knows, is incredibly important.”