Cosmo Tech

Using Gen AI to Optimise the Supply Chain – Interview with Michel Morvan

Using Gen AI to Optimise the Supply Chain – Interview with Michel Morvan

Cosmo Tech has unveiled a new AI-Simulation Copilot software that continuously optimises performance throughout the supply chain

With AI becoming more involved in the supply chain space, more leaders are looking for ways to harness the technology to address real-world needs and help their businesses.

Cosmo Tech recently announced the launch of its newest platform capability, a state-of-the art virtual assistant that incorporates generative AI (Gen AI) and advanced simulation.

This innovation democratises access for all business decision-makers to both predictive and prescriptive capabilities, unlocking new possibilities for the continuous improvement of strategic decisions and day-to-day operations.

Michel Morvan, Co-Founder and Executive Chairman of Cosmo Tech, spoke to Procurement Magazine about the new assistant and how it can optimise the supply chain.

Tell us a bit about yourself and your role

I’m Michel Morvan, Executive Chairman and Co-Founder at Cosmo Tech, an AI-Simulation software company. Prior to co-founding Cosmo Tech, I was the Chief Scientist and Corporate Vice President for Strategic Intelligence and Innovation at Veolia Environment.

I also have a strong academic background in mathematics and complex systems modelling. I spent many years as a Professor of Computer Science and complex simulation and I’m currently an active member of the OECD Network of Experts on Artificial Intelligence.

As Co-Founder and Executive Chairman of Cosmo Tech, I find that blending my roles as both an entrepreneur and an academic is not only essential but also incredibly rewarding. It helps to bring cutting-edge innovations effectively into the business world, both staying ahead in the rapidly-evolving tech landscape and bringing tangible value for enterprises.

For those unfamiliar with Cosmo Tech, what does the company do?

Founded in 2010, Cosmo Tech is an AI simulation software company for enterprise decision making. It’s is a global pioneer in the modelling of complex systems and a recognised expert in combining core advanced simulation with other AI techniques.

AI simulation brings a view of the future with the reliability demanded by large organisations to navigate complex and uncertain environments. It helps decision makers to discover the best path out of millions of possible futures to anticipate what’s coming and continuously optimise day-to-day operations and strategic planning.

Cosmo Tech is used in many industries. Leading companies from the manufacturing, automotive, energy and transportation sectors rely on Cosmo Tech’s new predictive and prescriptive capabilities for better financial performance and resilience, while securing their net-zero trajectory.

Tell us more about Cosmo Tech’s AI-Simulation Copilot

As AI’s use is growing, complex and industrial organisations are seeking to assist their business leaders with the right AI applications that can deal with their complex processes and real-world uncertainties, delivering reliable insights and recommendations for their critical decisions.

But one AI technique alone cannot deliver what they need. The Cosmo Tech AI-Simulation Copilot incorporates Gen AI with advanced simulation and other key AI techniques.

The Copilot acts as a navigator. Just as you use navigator applications to drive to your favorite restaurant, our customers can enter their targeted KPIs to know what is the best way to reach their goals.

It simulates and computes every possible pathway, taking into account constraints, dynamics, bottlenecks – everything to find the best path to optimise day-to-day operations or the next five-year strategy. If a new disruption appears or a change in regulation, it will recompute and find the best solution.

Gen AI facilitates the adoption, helping both executive and operational decision makers to receive immediate responses through a chat discussion.

All insights and recommendations are robust and hallucination-free, as the copilot’s answers are grounded in simulation results generated by simulating all possible future behaviours and outcomes of your organisation, in response to a decision or disruption.

How will the Copilot optimise supply chain operations?

The Copilot software empowers all decision makers, at all levels of the organisation, to continuously optimise the supply chain performance.

This technology significantly saves time for both executive and operational teams. Above all, the AI-Simulation Copilot makes it possible to detect risks and opportunities, discovering new levels of optimisation that were previously impossible and providing considerable agility in the face of changes.

For example, following the complete blockage of a main supply route, the supply chain director can immediately know the consequences on the service rate and precisely which suppliers will contribute the most to this decrease.

The operational manager can then find the alternative supply to maintain the service rate with the optimal cost and CO2 trade-off.

How much potential does the AI-Simulation Copilot have?

The AI-Simulation Copilot offers great potential, with its ability to enhance and streamline the supply chain for large companies.

It drives value across the entire value chain, supporting a wide range of use cases from network design and supply and inventory optimisation to logistics and sourcing.

With this technology, leading companies are elevating their supply chain efficiency, reducing costs and potentially driving significant new revenue streams. In the automotive sector, a global tier-one manufacturer applied Cosmo Tech AI simulation to refine its sourcing approach in China, leading to a 5% increase in global profit margin.

Facing high demand variability, a leading technology company working with thousands of suppliers and more than 50 subcontractors is using AI simulation to optimise its restocking and inventory flow strategy through various transport modes.

With this approach, the company is reaching a 10-20% reduction weekly in express transport costs while maintaining service levels.

How is Cosmo Tech reshaping the procurement and supply chain landscape?

Cosmo Tech’s innovative software is transforming the way to make decisions, define strategies and solve operational problems – especially in complex and uncertain environments.

This tool helps procurement and supply chain managers to navigate the key challenges that today considerably limit the effectiveness of their operations, opening up new possibilities to minimise risks and find optimal trade-off.

By understanding which supplier will have the biggest impact on the overall performance in case of a disruption, teams can work ahead to procure dual sourcing with more informed decisions from supplier selection to contract negotiation.

They can also continuously adjust to demand variability, knowing precisely how to group purchases by quantity and location, or how to control emergency costs and CO2 emissions, while maintaining service levels.

Improving both impact-driven decisions and responsiveness for stakeholders, the AI-Simulation Copilot frees up the procurement team for more strategic stakeholder and supplier relationship management activities to drive significant value.

How can the AI-Simulation Copilot help sustainability efforts?

For large enterprises and especially for the industry, AI simulation opens up tremendous opportunities to optimise sustainability, particularly within the supply chain.

Companies cannot address CO2 emissions challenges if they are not able, at the same time and in the same movement, to improve their financial indicators.

AI-Simulation is made by design to find the best trade off. With the visibility to achieve ESG objectives and navigate the complexity of their intricate operations, decision makers can effectively find the best option to improve financial, operational and CO2 emissions target performance indicators.

Leading manufacturers are already significantly reducing their CO2 emissions with Cosmo Tech AI-Simulation. For example, an automotive leader has cut down transport and customs costs by more than 60% through an optimised sourcing strategy.

Asset-intensive organisations are reducing GHG emissions while extending the life cycle of their assets and reducing capital and operating expenses by 10-15%.

The AI-Simulation Copilot is emerging as the solution capable of offering a pathway to achieve environmental, alongside financial goals.

How will the AI-Simulation Copilot evolve?

I cannot imagine a future of supply chain management without this type of AI simulation technology assisting decision makers.

We know that complexity and uncertainty will not decrease. If companies want to stay competitive and resilient, business leaders have to integrate these tools to continuously drive value and keep their net-zero trajectory on track.

I imagine that the AI-Simulation Copilot will evolve to become even more user-friendly and easier to integrate into enterprise systems. I also believe it will evolve to provide even more visibility into the future for supply chain managers so that they can make informed decisions.

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