Redefining efficiency: How AI and humans work together in IBP
AI doesn’t replace humans. However, it can amplify and enable people’s ability to work smarter when it’s seen as a collaborative tool to drive business success, increase productivity, and align strategy with decision-making via IBP.
It’s a tale as old as innovation itself: the anxious worker sounding the alarm, “the machines are coming for our jobs!”. Since the industrial revolution, humanity has invariably reacted with fear and skepticism to each major leap forward in the technological race. We’re seeing it right now, as AI continues its march across society, but are those concerns really valid?
If you look to history, the answer is “probably not”. For the most part, the predicted worst-case scenarios attached to new technologies – mass unemployment and societal collapse – rarely come to pass. History has shown that while technology may disrupt certain roles, it also creates new opportunities.
The industrial revolution replaced much manual labour with automation, but it also paved the way for new industries and roles to emerge. More recently, the internet was initially feared for its potential to devastate traditional sectors like brick-and-mortar retail. Although it undeniably caused disruption, the long-term effects were beneficial – it led to the rise of online retail, which has transformed the global economy. In fact, this sector proved essential during the pandemic, helping many of us stay afloat through lockdowns.
While the fear of job loss due to automation is nothing new, AI’s role in business today is less about replacing human jobs and more about transforming them. It’s helping companies streamline complex processes, manage vast amounts of data and make more accurate predictions – tasks that would be overwhelming without technological support. Far from rendering humans obsolete, AI makes their contributions more valuable.
In the field of integrated business planning (IBP), we can expect a similar story. AI offers tremendous opportunities as a supportive tool and even a semi-human extension of the team, enabling humans to do their jobs more efficiently and focus on what they do best.
Defining roles in the IBP triangle
Humans need AI, and AI needs humans: this mutual dependence forms the core of the symbiotic relationship we’re likely to see embedded in IBP processes in the future. Picture the process as an inverted triangle, where both humans and AI have distinct roles to play.
At the top of the triangle sits your strategy, defined by humans but guided by data and insights. The IBP process follows, starting with market sensing, data shaping and then applying predictive insights. At the very tip – the decision-making stage – humans always take centre stage.
When AI is introduced, its role is most prominent at the top, especially in market sensing, while human involvement increases as the process advances. Human input is minimal at the start, gradually growing through the stages, and becoming critical when strategic decisions are made.
Now, think about the efficiency gains. If your team currently spends 80% of their time (or more) on manual tasks like fine tuning statistical forecasts, imagine reversing that. AI could free them to spend 80% (or more) of their time on decision-making – leading to better procurement and replenishment decisions, higher productivity and better alignment with the strategic plan.
AI can make that shift possible, by assigning the tedious tasks to your newest team member – who actually thrives on this type of work, without complaint!
Paving your own AI path
An essential takeaway is that AI is not a disruptive force by itself; rather, it augments existing processes. When properly integrated, AI becomes a key enabler of the holy grail of operational success: people, processes and tools working seamlessly together.
If fear or skepticism is your current stance on AI, it’s time for a reset. As the saying goes, “AI won’t replace you, but a competitor who knows how to use AI might.”
If you haven’t already begun exploring AI, there’s no better time. Like any business initiative, the starting point is asking the right questions: Why are we doing this, and how will AI drive real business value? Using AI (or any other technology, for that matter) just for the sake of it won’t yield results.
Wondering where to start? It’s simple: focus first on defining the need – your why – and support it with a business case that reflects that need and the anticipated benefits. Bringing in an experienced partner with a strong understanding of both the technology and your industry can be invaluable, as they’ll help you find effective use cases for AI that are uniquely suited to your business environment.
Most importantly, don’t feel bound by the paths others have taken on their AI journeys. Your approach must fit your own business and industry context, allowing you to realise AI’s full potential on your own terms.
We are enablers of change and transformation in Supply Chain, Financial Planning & Analytics, Information Management, Management Consulting, Project Management, and Managed Application Services. Contact us to find out more about how we work with your teams or call 1300 841 048.
