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Chatbots: The Competitive Advantage in Supply Chain Management

  • By Content Desk
  • June 24, 2019
  • 4 minutes read
Reading Time: 4 minutes

Artificial Intelligence has already received significant buzz in the past few years. In fact, it’s remarkable potential continuously garners eyeballs, especially, when it comes to the business fraternity. Enterprises have begun to employ AI powered solutions for better delivery of products by integrating these solutions with an array of systems and technologies.

Customers now have higher expectations in terms of service when they make a purchase, which is why, it’s crucial to provide better customer experience than at least your direct competitor, if not everyone else. In fact, they also demand faster and better responses to their queries. In order to save up on the time that manual processes take, Chatbots emerged on the scene as the trusted sidekick. They require fewer resources and get higher return on investment by solving customer queries in a jiffy.

What are Chatbots?

Chatbots have become the new norm when it comes to addressing customers’ queries and concerns digitally. They are automated agents talking to the customers and solving their queries. They exist in your smartphones, devices and even in cars. The response rate of a Chatbot is much more accurate and faster compared to humans.

The 2018 Chatbots Market Report predicts the global chatbot market will grow with a Compounded Annual Growth rate (CAGR) of 27.5% between 2018 and 2024.

In fact, people have already got used to digital assistants such as Siri, Ok Google and Cortana. Anyone can simply talk and chat with these assistants.

It is also estimated that chatbots contributed to the enterprise cost savings of $20 million in 2017 and will be responsible for cost savings of over $8 billion per annum by 2022.

Chatbots provide efficient and immediate response as they are integrated with AI. They are easily accessible and adopted. All the bots have a common back-end system and process which helps them in responding to the customers. In fact, the supply chain industry has also introduced Chatbots for storing the data and streamlining the entire process.

Let’s explore why Supply Chain Management and Chatbots make such great friends…

Supply Chain is a system of organizations, people, activities, information, and resources involved in moving a product or service from the supplier to the customer. It is the process of transforming raw materials to the end-product which is to be delivered to the customer.

It includes product development, production and sources that helps in creating the product and maintaining the flow to their customers.

The basic structure of supply chain includes four components:
  • Suppliers: They provide raw material needed for manufacturing the product. For example, iPad, processor chips etc.
  • Manufacturers: They collect all the parts provided by the suppliers and bring them together to build a quality product.
  • Distributers: They store and sell the products that are produced by the manufacturers.
  • Customers: They generate the demand of the product, purchase them, consume them and influence the quantity of their production.

Seamless supply chain management can yield great results; however, there are also some challenges or limitation that need to be encountered when it comes to efficient production.

Limitations of Supply Chain Management
  • Mismanagement in supply chain leads to waste of time, labor, services etc. That’s why the chain must be managed properly based on the business goals.
  • Extensive training is required to understand the working of the chain, if there is lack of training then the system becomes more complex to work with.
  • Advanced analytics are required to understand complex algorithms and technologies.

Chatbots came to be a boon for Supply Chain Management since their use would automatically address many challenges that Supply Chain Management poses.

Integration of Chatbots with the Supply Chain

The digital world offers wide access to a variety of technologies that can be employed depending on business needs, and AI powered Chatbots are becoming increasingly common.

The 2018 Chatbots Market Report predicts the global chatbot market will grow with a Compounded Annual Growth rate (CAGR) of 27.5% between 2018 and 2024.

One of the most common supply chain scenario is something like this – if the supplier wants the update status of raw materials or supply dates, he manually enters the booking number in the system to search the needed material from the inventory.

Once the product is delivered from the supplier’s end, he can no longer track the product journey. There is a communication gap between customers and suppliers at times when the product delivery is delayed. Not only can a good customer be lost, but a situation such as this can be a detrimental blow to the goodwill of the business. Chatbots are now getting integrated with the supply chain management integrated with chatbots so this can be avoided.

Here’s how that happens…

Chatbots keep the track of real-time data which is stored in a system. They have rights to update the data of suppliers and the customers. Chatbots using AI memorize the code that is entered and automatically update the status of the data. This helps in faster and efficient delivery.

Chatbots are also used as virtual assistants to solve the queries of the customers. As customers demand a quick response to their queries it is one of the best tools to be used.

Not only that Chatbots also serve as an excellent resource for planning and strategizing the supply chain of orders. With the help of AI and chatbots, a revolutionary transformation has been brought about the entire supply chain by eradicating the communication gap between customers and suppliers.

Cygnet Infotech has been bridging gaps between people and profit by providing robust scalable architecture for 19 years. Our technology solutions are powered by solution architects who understand your business needs. Looking for solutions to fuel your business growth? Reach out to technology experts at Cygnet today on +1-609-245-0971 or to know more.

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