Generative AI to Help Material Forecasting at Tesla

Summary

In this discussion, Courtney Wear from Tesla shares insights on the evolution of the supply chain industry. She highlights the transition from manual processes like using Excel to adopting generative AI for more accurate demand forecasting. Wear predicts that this shift will reduce inventory needs, freeing up cash for strategic projects and enhancing competitiveness. She anticipates significant impacts in industries like automotive, especially for companies with global suppliers. Wear also foresees improved consumer demand tracking and reduced inventory backlogs. She optimistically looks forward to a future where supply chain professionals experience less stress and enjoy better predictability in their work.

Takeaways

• 🚀 Courtney Wear is a supply chain expert with extensive experience across various industries, including apparel, medical, and automotive.
• 📈 The supply chain has evolved significantly, with a shift from manual processes to more automated and efficient systems.
• 📊 There's a growing adoption of new tools and technologies, such as generative AI, which is expected to enhance demand forecasting and material delivery predictions.
• 🔧 The use of Excel for supply chain management is still prevalent, but there's a move towards more advanced software solutions.
• 💹 Generative AI is anticipated to reduce safety stock levels by improving inventory accuracy, which can free up cash for strategic investments.
• 🚗 The automotive industry, with its global supply chain and high inventory, is poised to benefit greatly from these technological advancements.
• 🌐 Companies with international suppliers may experience the most significant impact due to the complexities of managing global inventories.
• 📉 For companies facing challenges with product demand, like EV manufacturers, new technologies could help in predicting consumer behavior and reducing inventory backlog.
• 🔄 The supply chain's transformation will likely have a ripple effect, impacting manufacturing processes and potentially reducing the need for manual tracking.
• 🔮 Looking ahead, supply chain professionals expect a future with less stress and more predictability, thanks to the adoption of advanced technologies.

Q & A

What is Courtney Wear's current role at Tesla?

Courtney Wear is an Associate Manager of Material Planning at Tesla.

How does Courtney describe the evolution of supply chain management?

Courtney describes the evolution of supply chain management as a transition from manual work to the adoption of new tools and emerging technologies, which aim to make processes more efficient, less manual, and more automated.

What impact does Courtney expect generative AI to have on supply chain forecasting?

Courtney expects generative AI to enable more accurate demand forecasting and material delivery predictions, which will help decrease safety stock levels and free up cash for strategic projects.

Why is Courtney excited about the adoption of new supply chain technologies?

Courtney is excited because the adoption of new technologies will make supply chains more efficient, reduce inventory holding, and ultimately make companies more competitive.

What challenges does Courtney see in the adoption of new supply chain technologies?

Courtney sees challenges in the adoption of new technologies due to some companies being tied to traditional methods like Excel, and the emergence of many new SaaS solutions that companies need to evaluate and adopt.

How does Courtney foresee the impact of supply chain technologies on the automotive industry?

Courtney believes the automotive industry will be significantly impacted because it holds a lot of inventory and has suppliers worldwide, making efficient supply chain management crucial.

What does Courtney suggest for companies with fluctuating consumer demand for their products?

For companies with fluctuating consumer demand, Courtney suggests that new technologies will improve the ability to track consumer preferences and market trends, leading to better inventory management and reduced storage of unsold products like EVs.

How does Courtney think supply chain management will affect manufacturing in the future?

Courtney thinks supply chain management will impact manufacturing by making it more efficient, reducing the need for manual tracking, and improving the predictability of materials and production schedules.

What does Courtney predict the supply chain industry will be discussing a year from now?

Courtney predicts that in a year, the industry will be discussing how AI and other technologies have improved supply chain management, leading to less stress and better predictability in day-to-day operations.

What is Courtney's perspective on the current stress levels in the supply chain industry?

Courtney acknowledges that the current stress levels in the supply chain industry are high due to challenges like the COVID-19 pandemic, but she is optimistic that technological advancements will lead to a reduction in stress and improved efficiency.

Outlines

00:00

🚀 Supply Chain Evolution and Future with AI

Chuck Martin interviews Courtney Wear, a Tesla Associate Manager in Material Planning, in Austin, Texas. Courtney discusses the evolution of the supply chain, moving from manual processes and Excel to new tools and technologies. She highlights generative AI as a key technology that will improve demand forecasting and material delivery predictions, reducing safety stock levels and freeing up cash for strategic projects. Courtney is optimistic about the competitive edge these technologies will give to companies, especially those with international suppliers and high inventory, like the automotive industry. She also touches on the challenges faced by companies with electric vehicles (EVs) and how improved forecasting can reduce unsold inventory. Courtney predicts that in a year, the supply chain industry will be less stressful and more predictable, thanks to the adoption of these technologies.

Keywords

💡Supply Chain

Supply chain refers to the network of organizations, people, activities, information, and resources involved in moving a product or service from supplier to customer. In the video, Courtney Wear discusses the evolution of supply chain management, highlighting the transition from manual processes to more automated and efficient systems. The script mentions the impact of emerging technologies on supply chain efficiency, which is central to the video's theme of industry innovation.

💡Manual Work

Manual work implies tasks performed by humans without the aid of automation. The script points out that many supply chain processes have traditionally been manual, often involving the use of Excel spreadsheets. Courtney Wear suggests that this is changing as new tools and technologies are being adopted to automate and streamline supply chain operations.

💡Emerging Technologies

Emerging technologies are new or developing innovations that have the potential to significantly impact industries. In the context of the video, Courtney Wear discusses how these technologies, particularly generative AI, are poised to revolutionize supply chain management by improving demand forecasting and material delivery predictions.

💡Generative AI

Generative AI refers to artificial intelligence systems that can create new content or data based on existing patterns. The video script highlights generative AI's potential to enhance supply chain forecasting accuracy, which would lead to reduced inventory levels and increased operational efficiency.

💡Safety Stock

Safety stock is the extra inventory held by a company to cushion against potential supply or demand uncertainties. Courtney Wear mentions that with improved forecasting capabilities from generative AI, companies can decrease their safety stock levels, which ties into the broader theme of optimizing inventory management.

💡Cash Flow

Cash flow represents the movement of cash into and out of a business. The video discusses how reducing inventory through better supply chain management can free up cash, which can then be allocated to more strategic projects. This highlights the financial benefits of supply chain optimization.

💡Competitiveness

Competitiveness refers to the ability of a company to effectively compete in the market. Courtney Wear suggests that companies adopting new supply chain technologies will become more competitive, as they will be able to manage their operations more efficiently and effectively.

💡SaaS

SaaS stands for Software as a Service, a software licensing and delivery model in which software is accessed over the internet rather than installed locally. The script mentions the rise of SaaS companies offering supply chain solutions, indicating a shift towards cloud-based, subscription services in the industry.

💡Automotive Industry

The automotive industry is highlighted in the video as a sector heavily impacted by supply chain technologies due to the large volumes of inventory it manages. Courtney Wear, who works in the automotive sector, discusses how advancements in supply chain management can significantly benefit this industry.

💡Electric Vehicles (EVs)

Electric Vehicles (EVs) are a specific product type within the automotive industry that the script mentions. The discussion around forecasting consumer demand for EVs illustrates the application of supply chain technologies in managing production and inventory for new and evolving product lines.

💡Manufacturing

Manufacturing refers to the process of producing goods or parts of goods. The video script implies that improvements in supply chain management will have a ripple effect on manufacturing, as better tracking and forecasting can lead to more efficient production processes.

Highlights

Supply chain has evolved significantly with a shift from manual work to adopting new tools and technologies.

Courtney Wear has experience across various industries, noting the transition from Excel to advanced technologies.

The emergence of generative AI is poised to enhance demand forecasting and material delivery predictions.

Reducing safety stock levels can free up cash for more strategic initiatives.

Adoption of new supply chain technologies is uneven, with some companies ahead of the curve.

The automotive industry, with its global supply base, is expected to be highly impacted by supply chain technologies.

Inventory management is crucial for companies, especially those with international suppliers.

New technologies will enable better tracking of consumer preferences and market trends.

Improved forecasting accuracy will reduce the number of EVs sitting in storage.

Supply chain advancements will have a ripple effect, impacting manufacturing and other upstream processes.

Manufacturers are advised to start tracking their supply chain to stay competitive.

A year from now, the conversation will likely revolve around the positive impacts of AI on supply chain management.

Post-COVID, supply chain professionals anticipate reduced stress and improved predictability in their work.

The future of supply chain management looks promising with less scrambling for materials and more efficiency.

Transcripts

hi this is Chuck Martin in Austin Texas

with me today I'm happy to say is

Courtney wear uh from Tesla associate

manager material planning welcome yeah

thank you so much for having me so

you're a supply chain Authority I looked

at your background as like you've been

supply chain forever tell me about where

the supply chain has come from and where

it's going yes so supply chain has been

going through a lot of changes over the

past couple years and we've seen a lot

of manual work I've been doing work in

all different Industries so I worked in

the apparel industry I worked in medical

industry and um now automotive and I've

seen in different companies a lot of

people are still using Excel um but I

know especially with the conversations

we're having today at the at the

conference there's a lot of new tools

and emerging technologies that are going

to help us um make things more efficient

less manual and more automated um

specifically generative AI I think is

going to give us the ability to more

accurately forecast our demands and more

accurately forecast when we're going to

see deliveries of material and that will

allow us to decrease our safety stock

levels so I'm super excited about that

because everybody wants to hold less

inventory on hand um and that's going to

free up cash and eventually we'll have

more cash available that will allow us

to dedicate to other more strategic

projects so I think all companies that

have a supply chain are just going to

become that much more competitive as we

um start adopting these Technologies do

they know it um I don't think so no uh I

I've talked to a couple software

companies too and I think you're seeing

a lot of um SAS pop up and those

companies are starting to uh pitch their

use cases and um some companies are

adopting it some companies are tied to

excel so I think it's going to take some

time and some people are more ahead of

the curve than others so in the short

term and the long term where do you see

the biggest

impacts yes I I think the biggest

impacts are going to be um specifically

with I mean I'm I work in automotive now

so so I do see Automotive being impacted

a lot by these Technologies because we

hold so much inventory um our suppliers

are all over the world and if if you're

a company who is uh has suppliers that

are mostly International then you're

holding that much more inventory uh so I

think those companies are going to be

impacted the most companies that have

the most um inventory to hold but if you

have have a company not Tesla obviously

but a company that that has done a lot

of uh EVS for example and they aren't

selling how how do they deal with that

cuz they don't know what consumer the

consumers are going to do right I mean

now right now today it's hard to

forecast that we do have some

forecasting abilities in place but with

um the new technologies coming up I

think there's going to be more ability

to to track what customers are going to

want and there's a whole bunch of data

to surround uh market research around

what C customers are going to be

purchasing in the future and those

seasonal changes so I think the accuracy

of those forecasts will improve and

because of that we won't see as many EV

um sitting in storage because they'll be

able to better predict who's going to

purchase them and when so that sounds

like supply chain is going to impact

manufacturing way back the beginning yes

I I think that's going to be the case

well that's a big deal it is yes so what

if you're a manufacturer you're not

tracking supply chain um I think then

you better start tracking your supply

chain wow so a year from now we're

sitting here having this conversation

what will we be talking about supply

chain yeah a year from now I think we're

going to be talking about how aici we

are I think we're going to look back to

co and to even right now we're still

suffering some of the impact of Co and

we're going to be a lot happier with

where we are because I know that there's

a lot of stress levels that are super

high in supply chain scrambling and

firefighting to um try to get materials

there on time and I think we're going to

see a whole lot less of that I think

people are going to be lower stress um

and they're going to have a better

expectation and predictability around

their day-to-day work well I look

forward to that conversation thank you

very much yeah thank you so much

n