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Supply Chain Optimization: Just the Facts
(4/15/1999) Ascet Volume 1
By Jim Shepherd, AMR Research
Larry Lapide, Ph.D, Massachusetts Institute of Technology
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Optimization technology offers great promise for improving a manufacturers' supply chain performance. Understanding it takes a great deal of work and effort on the part of users, but the benefits should far outweighs the efforts. Software vendors have recently designed products to give supply chain planners the ability to make better decisions, yielding increased value for both company shareholders and consumers.


Since the 1960s artificial intelligence (AI) research has sought to enable computers to replicate the thinking processes of the human brain. But many efforts have failed to produce useful results. One visible "big win" for the computer versus the human recently occurred when IBM''s Deep Blue finally beat chess master Garry Kasparov. Can computers out-think people? Probably not! Deep Blue was able to beat Kasparov because the computer''s logic was tailored to its opponent''s way of thinking, based on his prior games and strategies. Thus, the computer logic was focused on tackling a particular problem area, not on general thinking processes. Ultimately, the computer won because it could dispassionately, tirelessly, and mechanically sort through many combinations of potential board situations extremely rapidly. Thus, the computer does not replicate the thinking process, but it can improve decision-making and strategy.


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