Risk management is important in a company. A company cannot possibly define its goals for the future without first analyzing and identifying possible risks, challenges, or disasters it may encounter. By executing a risk management plan, a company can assess potential critical risk that needs to be prioritized before they could cause adverse impacts on their interests. Effective risk management strategies empower companies to reduce supply chain risks and maximize profit at the same time.
In today’s fast-paced digital world, traditional risk management approach can no longer be considered as effective as it used to be in intelligently managing supply risk within supply chains. What this generation needs right now is an approach reimagining risk that encompasses all the facets of the business. This is where cognitive computing comes in.
Cognitive computing, as defined by its developers in mid-2014, makes a new class of problems computable as it addresses complex situations that are characterized by ambiguity and uncertainty. It offers a synthesis not just of information sources but of influences, contexts, and insights by weighing conflicting evidence and suggesting an answer that is “best” rather than “right.”
Cognitive computing helps managers effectively acknowledge the challenge of growing a business in a time of increasing risk by allowing it to interpret vast amounts of information in predicting future demands and creating better business plans. It also provides visibility into not only what has already happened but what is likely to happen next.
Cognitive computing does not entirely debunk the traditional sense of risk management strategy. It is true that for some companies, particularly the small ones, basic analytical tools embedded in their supply chain programs can suffice but as larger they become, the less support these programs will offer.
A recent study conducted by Gartner Research proves that running a large supply chain without advanced analytics is unrealistic. Relying solely on existing supply chain technology is not flexible or reliable and cannot handle a large-scale, dynamic problem.
In fact, many companies strongly believe that maximizing cognitive computing will lead their business to a growing success. About 84% of the 835 executives across 13 global industry sectors in four regions of the world see artificial intelligence as something that will be ‘essential’ for businesses to succeed in the coming years.
There is no doubt that cognitive computing should now be considered as indispensable in a business’ growth. Leaders of organization should aggressively work hand in hand in developing an advanced and sophisticated data analytic tools to unearth more of cognitive computing’s potentials. Accordingly, companies should make a realistic evaluation of the true level of risk and define the areas where cognitive computing can be applied.
Only by doing these can we see the actual opportunities cognitive computing can offer that will allow companies to grow substantially while keeping all potential risks under control.
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