The once overlooked realm of supply chains has surged into the forefront of public interest in the wake of the global pandemic and the sheer volume of disruptions that all seemed to come together at once. The world has witnessed how these disruptions and geopolitical tensions can send shockwaves across the intricate, global networks, laying bare their complexity and fragility. But amid a constant stream of challenges, we’ve also observed the resiliency of supply chains, fueled by the relentless efforts of supply chain professionals who have embraced innovative thinking, transformative processes, and powerful technology to keep the cogs turning.
In "The Magic Conveyor Belt: Supply Chains, A.I., and the Future of Work," esteemed author and Director of MIT Center for Transportation and Logistics, Professor Yossi Sheffi delves deep into the fascinating and multifaceted domain of supply chains. With decades of expertise in the field, Professor Sheffi illuminates the operations of these complex systems, offering valuable insights into their evolution. "The Magic Conveyor Belt" explores the symbiotic relationship between humans and artificial intelligence, presenting a nuanced view of the future of work in supply chains.
Given the thought-provoking nature of his work, we reached out to Professor Sheffi to learn about the genesis of this book and take a peek at a few of the key insights and considerations companies should take into account as the industry continues to evolve toward an AI-driven future.
What motivated you to write the book “The Magic Conveyor Belt: Supply Chains, A.I., and the Future of Work”?
Y. Sheffi: After the pandemic, I was contacted by many acquaintances who were asking me to explain supply chains. What are they? What is supply chain management? Why is it so complicated? Why was it hard to get certain products during the pandemic? And why was the press saying that supply chains were broken? Instead of having one-on-one meetings and explaining to many people what supply chains are, I started to write this book: The Magic Conveyor Belt with the subtitle “Supply Chains, A.I., and the Future of Work.” The first part of the book explains the processes and steps involved in getting from mined material to a finished product. My hope was that as people understand what it takes, they will stop moaning about out-of-stock products and instead be amazed and wowed when a product is actually on the shelf when they are looking for it.
As I was explaining supply chains, I also covered the use of technology in managing these vast networks, the many technologies used by their operators, and the evolution of these technologies during the first, second, third, and fourth industrial revolutions. I also covered AI (Artificial Intelligence) which is the newest technology and the one that right now generates the most angst among workers worrying about their job. So, the book also covers the potential benefits as well as the risk associated with AI. In particular, the focus is on the potential for AI to obviate certain jobs and the challenge of getting humans and machines to work together.
In your book, you refer to the ‘magic’ of supply chains and their ability to accomplish so much with limited resources. In your opinion, how can companies ensure that this 'magic' endures in the face of evolving challenges and disruptions?
Y. Sheffi: I think we already saw how the magic took place. During the pandemic supply chains were subject to unprecedented disruptions: wildly different and fluctuating demand patterns, shortages of materials and supplies, and scarcity of workers. And yet, the systems adjusted.
The lessons from this disruption are still being processed by many companies: they try to ensure continuity of supply by contracting with local suppliers or ones in friendly countries; they are building some redundancies into their supply chains by relying on more suppliers for critical items, in some industries they adjust normal stocking levels; some companies are trying to move out of China, etc.
One should add that none of these strategies are easy. They are all expensive and are likely to take a very long time to implement.
Could you elaborate on some common misconceptions on the role of AI in supply chains, and how your book helps provide clarity?
Y. Sheffi: The first misconception about the role of AI is that this is a new technology. It is not. The robots running many of the warehouses, the autonomous trucks that may soon be carrying freight with little human intervention, forecasting models that are based on machine learning, and other AI Technologies are all already in use as well as many others which are part of existing processes and applications.
Some of the general angst among workers is that AI will replace most of the tasks in the jobs they are performing and ultimately replace them. One should realize that while some jobs may disappear (we do not have elevator operators, for example), history has proven over and over again that new technologies always created more jobs than they supplemented. The main impact of new technologies on existing jobs was to change and modify them, rather than to eliminate them. Furthermore, the introduction of new revolutionary technologies into the workflow of companies takes much longer than expected.
Finally, supply chains are basically social networks. They are based on relationships among people. Moreover, supply chain management is an outdoor sport subject to many unexpected disruptions. It is when things go awry that humans will need to intervene and take over. Knowing when the context of the work will change is an area in which humans are better than machines and will have to be involved for a long time.
Your book explores the capabilities of automation, robotics, and AI, highlighting their potential to augment jobs in supply chain management. What would you say are some key considerations for organizations in effectively integrating these technologies into their workforce to maximize the benefits?
Y. Sheffi: The main future challenge will be the integration of humans with AI-infused machines. The best way to do it is to recognize which tasks machines are better at and when humans excel. Thus, for example, machines can perform simple jobs, escalating the task to a human operator when the task gets too complicated or beyond the machine’s training data. Consider, for example, the ubiquitous chatbots. As long as the interaction with the bot is standard, the bot understands the issues, it can offer solutions. However, with special issues and contexts, the bot “kicks” the interaction to a human operator. This is one example of the way humans and machines can work together.
In other cases, the human is “in the loop” and the work goes back and forth between the machine and the worker. Such an environment exists in many warehouses where an aisle is brought to a worker who picks some items only to see another aisle coming over so the worker can pick more items and complete an order.
In other situations, the worker controls the work of the machines. For example, in many automotive plants, workers with iPad-like devices manage the work of robots.
Finally, what do you hope readers will take away from your book, and what impact do you believe it can have on their understanding of supply chains, AI, and the future of employment?
Y. Sheffi: I hope that readers will understand what supply chains are about and will appreciate the complexities and challenges involved in planning, operating, and managing global supply chains. I hope that some young readers will be motivated by the challenges of this profession and will strive to join it. I hope people will realize how sophisticated and technology-driven the profession has become.
On a separate issue, I hope people will realize that just like in the preceding four industrial revolutions, many more jobs will be created rather than lost. Furthermore, the integration of advanced technology into organizations’ processes will take a lot longer than most pundits realize. Such implementation may be hampered by government regulations, union resistance, and social acceptance. However, upgrading knowledge and capabilities and ‘playing’ with the new technologies is something that responsible workers should engage in now in order to make sure that they are prepared for whatever the future may bring.
About Dr. Yossi Sheffi
Dr. Yossi Sheffi is the Elisha Gray II Prof. of Engineering Systems at MIT, where he serves as Director of the Center for Transportation and Logistics. He is an expert in systems optimization, risk analysis and supply chain management.