[Music] My guest today is Wanda Johnson. She's a supply chain technology fellow with DEOE. Hi Wanda. Hi, how you doing Bob? Good, thank you for joining me. We're going to talk today about DEO's annual industry report: Collaborative Supply Chain, Human-Centric, Tech-Driven. Give me the history of that. When did that report start and what were you out to find out in launching such a thing? So, it's amazing. This is our 10th year with the report. So, we have been doing a report, working with MHI for over the last 10 years. If we look at the last three years, how we actually specifically used, start thinking about COVID to where we are now. Last year was on supply chain resiliency and sustainability, and this year we really tied back to all the things that we talked about over the last 10 years, is how do we actually get the industry and the people that's within the supply chain business to understand, you know, the trends that's out there, how those

Trends are changing year by year, and looking at where we're going and what the future looks like for leaders. So, who did you survey? Like, tell me a little bit about the survey base. The survey base is we typically send out close to two, over 2,000, but we get back about 20, a th,000 to 15. It's CEO, CIOs, leaders, and the director in the supply chain industry, technology, and that space. And that's who we actually send surveys out. They answer those questions, come back, and then we collect all that data and use that data to actually develop the report. Interesting, though, that a technology report should make a point of including human-centric in it. So, I see you're looking, you're keeping the human side of it in there. Yeah, well, you know what? A lot of people failed to remember no matter how you grow in the technology space. It's always going to be a human standing set beside that. You cannot take that out. I think the main thing a lot of people, and that's why in our report we

All in every report, we always talk about change management. The human aversion to change has to be overcome, especially with any technology adopting. Let's talk about the findings of this year's report. What would be like a key couple of key takeaways from this time around? Well, two of the main two takeaways is a lot of the respondents came back and said it's going to be a price increase of what technologies they want to implement. So if you look at robotics, automation, G, um, gen, that was the three main things that have been consistent across all of the reports. But this year, gen AI actually came up to at the top, and AI, you know, people say gen AI, but AI came to the top. And with AI coming to the top, a lot of the people wanted to know it's not replacing. So in our report, we wanted, we gave a good definition of what is Gen, how is that used to make better decisions, how is that making your human or your employee now what they were doing today, they're enhancing their

capabilities and reskilling them. They give you better predictive data or how you can actually have a better outlook. So that plus we tied into that. How do the human actually, as I said, geni? You can have a chat GPT, you can have all that, but still, you got to have that person give that information, and the information has to be correct. Yeah, we talked about that, the data part, data governance, data on um, the data that's collected by companies, and actually understanding that you have to have clean data to actually get the best results. Garbage in, garbage out. Yeah, well, over those 10 years, this report, what have you seen in this report as the kind of the transformation from descriptive AI or descriptive automation to predictive, and then finally prescriptive, in which the m, in which the AI or the machine actually is making certain decisions. So there, I mean, some of that is happening, is it not, or is there always a human being at the other end making the final decision? It's always going to be a human being making

those decisions think so you. Let's think about AI. Let's talk about that just briefly. AI has been around for many years. It's always been more programmed, whether it's programmable, it's actually static data and all that. But now with Gen A, we're taking all that data and we're allowing. So let's give, I'm going to give you a good example. If you're a planner and you're trying to plan out your routes and all that, you always had that. You probably went through and did all that manually and you did that process. But now we have all that data of all those trucking routes, all of that. Now you could type in a question and say, Is it better for me to optimize sending this to XY, this a um ABC point, or should I do it that way? It can come back and give that end user the best ways of how to optimize their data. Yeah, 'cause you have all the history, but you've collected it all. Yeah, but the geni on kind of the general.

consumer level, you know the problems we see there with the AI quote-unquote hallucinating, coming out with saying things that just aren't true. How does that not happen in a more business-oriented environment or, you know, the supply chain environment? That's not a problem. Well, I'm not saying that's not a problem because that it's so ironically. You're talking about that. We just talked about that last night. Even to the ethical part of AI, yeah, and a lot of companies, if you think so back to your question, yes, we have to consider that. And that's why a lot of times what we are trying to do is how do we cleanse that data and how do we make it so have security controls around it to make sure that what we do come out with. That's why you got to see, have the human there. Yeah, yeah, you got to have that person to look at it and say, Is this the right? Because if you, if I'm Suzie and I've been doing this for how many years and now I have

this computer is generating all this information. I'm asking them the question. I still have that capability to do analytical analysis on that information that comes out to make sure that is this solid, is this right? Because you could, you know, I know one guy was telling me they did use GNI to help build out diversity at their company, who they should hire, but it came back with not the right. It's a huge, still a huge problem with AI. Yeah, so you really have to think about this. Even though I have the data and I have the person, you know, typing in a chatbot or whatever, you still have to take the time to look at the data. And that comes back to, at the end of the report, we have the section on human interactions and what that means and why it's still important that people are not going to lose their jobs. It may be skilling or you may be, hey, you may be doing this specific job today, but you're doing something different 'cause I'm enhancing your capabilities. Yeah, what are we learning?

about change management, about how companies can do that in a way that brings in technology in the right way, gets acceptance from the people who are on the job. The biggest thing we've learned is you need to engage all your people at the beginning of the process, and that means when I decide that I want to implement any type of gen, if I want to implement automation, robotics, anything like that, bring them along the journey. Do not wait and say, Hey, we're ready to implement this, we're ready to go live, and you trying to get them to adopt. Adoption takes time, specifically if you look in the industry and if you look at distribution and warehousing. We have people that's been in those jobs, some of them more than 10 years. They've been doing that same job, either driving a forklift. Now you're saying, Oh, we're not going to drive a forklift anymore. Yeah, you can certainly understand their reverse at first. You know, it's a natural kind of instinct, is it? Yeah, and

there and sometimes you get that resistance, but if you actually have communication, you have all of those journeys, and you take them along that journey with you. Yeah, get them involved in testing, get them involved in that whole process. It makes a big difference. So the report is annual, is it not? Yes, it's every year. We actually, um, this year, of course, it's a Modex, then next year it'll be Promat. So we do the report every year, it's an annual report. Uhhuh, well, I look forward to seeing where it goes from here on out, but thank you, Wanda, so much for helping us understand and giving us some insights into how the whole issue of technology and supply chain is being approached today based on this report. Thank you so much for your time, and thank you very much. You have a good day too. Okay, I was speaking with Wanda Johnson of DEOE. Thank you very much for watching.

Deloitte's Annual Report on Technology in Supply Chains

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