Smart Supply Chains Power Bottom-Line Results

As supply chains have increasingly become more complex with greater risks, volatility, and costs, digitizing with smart supply chains has become integral to success. According to ZipDo statistics, 80% of businesses can see ROI within the first year of artificial intelligence (AI) deployment in the supply chain. McKinsey data shows median returns of 3.5x investment over three years. Thus, AI and advanced technologies power smart supply chains and bottom-line results.

Smart Technologies Gaining Momentum

As clients search for ways to provide superior customer experiences and scale up to meet demand plans while increasing EBITDA and accelerating working capital, they are turning to AI and advanced technologies and better leveraging ERP. Customers’ demands continue to increase as companies pivot to respond rapidly to changing conditions and enhance value to stand out from the crowd and gain additional customers. AI embedded in customer relationship management (CRM) systems, sales forecasting systems, e-commerce systems, and supply chain visibility systems is gaining momentum to provide value to customers.

On the other end of the spectrum, costs have been increasing with high inflation rates and cost increases in the last several years, yet companies cannot pass on all price increases to customers. In addition, as supply chain disruptions are elevated with geopolitical risks and changing conditions, higher inventory levels have been required to ensure service remains intact. Thus, forward-looking companies are utilizing AI, advanced technologies, and ERP systems to drive cost and cash flow improvement. For example, advanced planning and scheduling systems optimize operational performance, minimize freight and logistics costs, and reduce inventory levels while supporting customer needs. Digital twins allow for what-if scenario planning to refine plans and increase margins.

Smart Supply Chains for Smarter Decisions

An industrial equipment manufacturer experienced reduced backlogs due to high interest rates causing companies to push out orders and delay large ticket items. The executives wanted to optimize the company’s manufacturing and supply chain network to achieve EBITDA goals while maintaining highly skilled talent. Thus, after deploying typical tactics such as reducing overtime and temporary labor and cutting back on purchase orders to reduce inventory levels and free up cash flow, they wanted to go a step further by utilizing AI and advanced technologies.

Thus, they deployed advanced technologies in their facilities and were able to meet customer volumes without adding people and not replacing workers who retired. For example, they rolled out robotics in their operation, upgraded their laser machine to increase efficiencies by over 20%, and optimized their machine shop output by gaining visibility into demand with their SIOP (sales inventory operations planning) process. In addition, they upgraded their use of their ERP system to automate order fulfillment processes and utilized data from their CRM, ERP, and peripheral order tracking systems to better forecast capacity requirements in multiple sites; this allowed them to reallocate, optimizing their manufacturing output and maximizing logistics efficiencies. By utilizing simulations and business intelligence capabilities, they improved their cost structure.

The Bottom Line

As global supply chains evolve, the companies that thrive are turning to AI, advanced technologies, and further leveraging their ERP systems to automate the mundane. The best companies are starting by better utilizing their already existing and underutilized asset, their ERP system, while simultaneously pursuing advanced technologies that will add value to the bottom line. The smart use of technology can drive win-win-win results of speed and customization for customers, collaborative optimization for trusted suppliers, and EBITDA growth for the company.

Originally posted in Adhesives & Sealants Industry in January 2026