Abstract:

The paper examines the applications of Artificial Intelligence (AI) in operations management across essential business functions that include planning, procurement, production with industrial automation, supply chain, and human resources. As artificial intelligence is fast becoming an innovative if not groundbreaking ubiquitous technological tool adopted by many industries and sectors of the economy, the paper attempts to provide the review of the early AI implementation with already reported advantages and challenges. The article, based on reported case studies from some major corporations such as Amazon, Siemens, and Google, describes how AI technologies such as machine learning, predictive analytics, automation improve efficiency, quality, and other vital economic performance related indicators. The analysis shows that AI tools in firms’ operational processes reduce costs, improve managerial decision-making accuracy and relevance, among other advantages. The paper also shows the early challenges and costs of adoption of AI tools. The challenges may include data security, implementation costs, uncertainty due to operational unpredictability of AI methods (hallucinations), and workforce skillset gaps.

Keywords:

Operations management, AI applications, workforce skillset.