Could AI Prevent the Next Global Supply Chain Crisis?
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The last few years have seen an explosion in advancements in artificial intelligence with the potential to dramatically change all sorts of industries, including global manufacturing. But the new technology is also bringing a new uncertainty as business leaders try to figure out how to use these tools to manage their supply chains and their workforces.

IT is shocking to me that in this DNA, we don't understand how much supply or demand is needed to run the world.

I D is the C E O of flex, a company that manufacturers the components that go into everyday products from coffee makers to electric vehicles, is also part of the U. S. Government advisory committee on supply chain policies.

Advice spoke with W S. J. Reporter Emily glaser at the wall street journal CEO council summit on december twelve, twenty twenty three.

with so much data and so much information out there, I mean, that shouldn't be the world anymore.

should IT from the wall street journal. This is the future of everything. I'm dani Lewis. Today, we're bringing you a conversation about the future of manufacturing in a world where technology is rapidly changing and how that will affect how everyday products are made. Stick around.

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And now here's some of W S, J. Reporter Emily glaser interview reflects CEO ravel y advice.

Thank you. Ravel y. Let's kick right off and talk about the job market. Are there are certain jobs where you're still thinking, man, we still need more AI specialist or we've gotten get more focus on the factory floor that even if there's a slowdown, they're still such a drive to get certain roles in place out.

Definitely, I would say anything around skills that are specific to supply chain resiliency associated with software skills on how to do production planning or read tooling your software systems to make IT more efficient. All those skills are still hot in the market and difficult to get.

But a lot of the people we hire will be around, you know, can you run your t surface mining technology machines? Can you run your big fabrication equipment and can you move people from one to the other? I was to the higher skill workers are still difficult to find. There are still a hot commodity, uh, most people want to go to the cool, sexy software company, not always to manufacturing. So still hiring around those sectors and I think that accelerate um but in the day to day jobs, I would say we're much slower than where we were.

You mention the cool, sexy brands, and i've heard you were a flex as the name behind many of these companies. I would imagine in the last twenty four hours, many of us perhaps have used products that flex contributed to making, whether it's a hair dryer, a coffee machine. Could we take a step back and you tell us a little bit about all of the different work that flex does and what IT contributes to?

You know what my tell mom, aren't you making those cool, interesting, sexy things that you know, we use every day? I always say, you know, if we didn't make the product, you wouldn't have them. We're not the brand, but we make everything from vacuum cleaners to head driers to straight ers.

We used to be big in the mobile phone segment, but not anymore because at the product and markets was too competitive for us to be in. We are big in terms of cloud communication. Can enterprise sector on technology, industrial and power is one of our biggest and markets. So we're big in terms of whether IT is embedded power on compute, whether IT is facilities power, whether it's just basic infrastructure, industrial or residential, commercial, automotive, evs, a significant platform for us. So we make little things to very dragani things and put all of them together across the world.

some and everything in between. You mention evs, and I do want to talk about the economy a little bit. We've reported that there is been a slowdown in EV demand. That is that impact your business or does IT definitely.

I would say as you see slow down in the electric vehicle market will definitely see an impact related to that. But I think our growth this mass by the amount of shares, again, we have had related to this consolidation that's been happening around E, V. Supply chain.

So but i'm not too worried about automotive. I think there is gonna more about can you keep up with capacity? Do you have enough room to grow? We are also strong in terms of the china E V N markets, and their wild growth has been a little slow recently.

Read my mind, I was going a lot of potential for the future. So they're well distributed between north america, europe and china in terms of E V. So i'm not worried about automotive slowdown because I think we have a lot of growth is gonna about capacity, but some markets will be slower than the others are, right?

Let's get into A I so you're on the commerce uh, sub committee where a lot of the work is looking at how to try to prevent some as the supply change chAllenges. Can you tell us a little bit about the work you're doing on that sub committee and where A I might fit into fixing this global supply chain?

So um that's a big question. I'd say our work has been focused around first test availability of people. All these metal factories being built across america.

We need people to run those of factories. So how do we focus on the right policy for workforce killing to help manufacturing be a real contributor to the economy in the U. S. So that was one of the .

subset really quickly. Do you think we're there yet? Or is that these factories are are being built open up and they might be a little bit empty?

I don't think we're there yet at all if we see articles every day about how hard IT is to staff up some of these facilities, right? And reskilling, at least for manufacturing, it's like it's an easy thing to do IT isn't do you have to go to a lot of rural communities and help set up community colleges to really build the pipeline? This is just gonna long term work is going to require an immigration that's fairly robust if you want to keep these factories running, we can give a lot of recommendations, but politicians will do what they have to do in some of them work, some of them aren't taken into consideration.

But that was one theme of work. I would say the second theme of work that was around resiliency, you think about medical devices and how much work has to be done around transparency of that supply chain, making sure that you are really thinking about building resilience ency in the long term. Can we get different parts of the government and private enterprise to work together to build a more transparent medical device supply chain as an example, and then build a robust supplier around IT? And then we should eventually get to know, what does planning look like in the world of A I and supply chain? But I D say for the manufacture submitted tee, those were the two major themes of work that we were doing and helping with recommendations just ahead.

Can A I make supply chains more resilient and predictable? And how might that change the way global manufacturing work stay with us?

Amazon q business is the new generative A I assistant from A W S, because many tasks can make business slow, as if waiting through .

mode a help. Luckily.

there's a faster, easier, less messy choice. Amazon q can securely understand your business data and use that knowledge to streamline task. Now you can summarize quarterly results or do complex analysis in no time.

Q got this. Learn what amazon q business can do for you at A W S dot com flash. Learn more.

How might A I improve the supply chain? You talk about thinking about a too fold short term and long term. How can I improve the efficiency and productivity of your company and also how my data leverage uh, or streamline some of these hold ups in the global supply chain? So taking that longer term view, what's on your wish list? If you could fix the supply chain and and use A I and have this technology ready.

what would that look like? So I want going to talk about in tooth parts. One is what happens in a manufacture floor.

And then second is what happens from the macro planning standpoint. So last thirty years, I have been in factories around the world, right? So i'm excited about the next twenty.

The reason is this, if you think about factory productivity, that hasn't moved significantly, like in the early two thousands, late one thousand nine hundred nineties, when labor arbitrage was a big thing, you saw a lot of emerging economies benefit from IT. And A I can be kind of an equalizer in some ways. I'm not talking about the fully automated large fabs or the large factories that we run.

But if you think about small medium size manufacturing A I, if the cost is lower to implement than hard machines could be an equalizer in terms of driving productivity. They'll have twenty five, thirty different fragment software systems that don't talk to each other, trying to run production planning schedules and factories. And you make up for all that low capacity of aliza of the equipment by adding more equipment capable is not that cheap anymore.

So what do you do? So I feel like A I can help by taking the combination of how is your working capital deployed, can you improve your utilization of your equipment? Putting all that together, I think I can help of just driving factory productivity so that i'm very excited about because this gives small media manufacturing and age jah.

I am excited to see what happens with that. And they'd step back into the macro roll of what happens with the A I M. planning. So we just went through a supply chain crisis.

IT is shocking to me that in this day and age, we don't understand how much supply or demand is needed to run the world with so much data and so much information out there. I mean, that shouldn't be the world anymore, should IT. So I am excited to see.

Can you have large kind of multi model event models for planning? Let's see, even for chips, right? And that in the future will drive really good intelligence where you don't end up in the supply demand in equity and the new soul ford, again, by putting too much inventory.

That shouldn't be the case in this DNA. Yes, right. But that requires a different level of participation from industries and sectors across the world. I'm interested do we prevent the next supply chain crisis from happening because iran out of one component um across the world.

Well, on that note, thank you so much travesty. We appreciate IT.

thanks. Thanks for having.

That was flex CEO gravity advisory. Speaking with reporter Emily glaser at the wall street journal's CEO council summit in december, you can listen to their whole conversation on our subscriber feed. W S J.

Special access. The future of everything is a production of the wall street journal. This episode was produced by me, daddy Lewis. Thanks for listening.

Amazon q business is the new generative A I assistant from AWS because many tasks can make business slow, as if waiting through .

mud a help. Luckily.

there's a faster, easier, less messy choice. Amazon q can securely understand your business data and use that knowledge to streamline task. Now you can summarize quarterly results or do complex analysis in no time.

Q got this. Learn what amazon q business can do for you at AWS dot com. Slash, learn more.