AI & COVID-19: Stabilize & Survive
In the midst of the COVID-19 pandemic, why are corporations accelerating rather than delaying their digital transformation initiatives? The pandemic’s unprecedented impact on demand, workforce, supply chain, short-term costs and liquidity has forced corporations to take immediate, strategic action to maintain operations. In exploring their means of stabilization and survival, corporations found that Artificial Intelligence is uniquely positioned to ensure business continuity in the short-term, with its proven value in improving employee safety & security, short-term costs and liquidity.
While no industry has proven immune to the pandemic, the depth and breadth of its disruption in the manufacturing vertical clearly demonstrates why corporations have adopted transformational technologies over traditional solutions to beat COVID-19. Manufacturers have felt the acute pressure of COVID-19 in their plants and across their value chains.
- Demand: Sharp declines in demand across non-essential product segments have disrupted each step of the value chain, driving significant earnings adjustments; essential goods producers are struggling to continue operations with heightened risk, and to satiate demand with unprecedented operating and supply chain limitations.
- Supply Chain: Despite the geographic diversity of supplier networks, sudden overseas supplier shutdowns and domestic fulfillment delays have disrupted if not halted downstream activity, depleting on-hand inventory, prompting a rapid search for market alternatives, and driving material and part shortages, price increases, and an expected spike in upstream transportation costs as restrictions lift.
- Workforce: Rapid adoption of new distancing protocols, shift structures and offsite resourcing arrangements have ensured employee safety & security, but constrained operating efficiency, quality, throughput and yield; deferred critical asset maintenance and replacement have increased downtime risk and may increase mid-term CAPEX obligations.
- Short-Term Costs: Essential and non-essential product manufacturers have made significant adjustments to minimize variable costs, maintain business operations, and operate in an environment of significant macroeconomic and trade policy uncertainty, including layoffs, furloughs and temporary plant closures.
- Liquidity: With strong macroeconomic headwinds, demand and supply side disruption, and constrained operational agility, liquidity is a principal concern of manufacturers that will not be alleviated at the moment restrictions are lifted, but gradually as the supply chain and broader economy rebound.
How is Artificial Intelligence empowering corporations with substantial value chain disruption to act fast and weather the storm?
Elutions’ highly-automated and autonomous Artificial Intelligence solution, Maestro, leverages historical data, deploys rapidly and delivers immediate improvements in safety & security, short-term costs and liquidity. The following Artificial Intelligence use cases are paramount to ensuring business continuity in manufacturing.
- Remote Operability, Operational Automation & BEP Adherence: By enabling remote asset and process control, visualization and planning, and automated system-driven asset and process optimization, corporations ensure operational continuity, resilience and efficiency, improving employee safety & security, reducing labor requirements and operating costs, and increasing cash-on-hand.
- In-Line Quality Assurance & Scrap Reduction: By enabling automated quality prediction and dynamic operating parameter adjustment at each stage of production, manufacturers autonomously ensure end-product quality, minimize scrap and rework, and optimize the Unit Cost of Production as conditions change, improving operating margins, yield (revenue), and liquidity through minimized waste.
- Dynamic Downtime Prevention & Predictive Preventative Maintenance: By enabling dynamic, system-driven alternate control sequencing in the event of a sensor, asset or process failure, corporations autonomously avoid unplanned downtime, associated repair and replacement costs, and foregone revenue. With system-driven Predictive Preventative Maintenance and automated Work Order creation, corporations minimize downtime and production risk, extend asset use life, generate significant savings through right-time, right-size maintenance, and improve safety & security through truck-roll consolidation.
- Market, Demand & Capacity Driven Procurement & Inventory Management: By continuously predicting raw material costs, sales and capacity alongside the live environment, and enabling automated procurement and IM directives, corporations optimize operating productivity, inventory levels, and the margin value of Inventory on-hand. Similarly, by continuously predicting replacement part costs, process demand alongside forecasted utilization, and automating replacement part purchasing, corporations optimize part inventory levels, reduce short-term costs and improve liquidity.
Beyond short-term survival, corporations have placed their bets on Artificial Intelligence to thrive in the mid-to-long-term. Stay tuned for more market intelligence on how AI is helping corporations build resilience and optimize operations.
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