While Augmented Reality (AR) is gaining significant attention as one of the Industry 4.0 technologies that will revolutionize supply chain, we believe it is important to look beyond the hype and qualify the true potential and challenges of AI/VR in supply chain.

The value of AR is directly tied to its ability to impact human workforce experience and performance.

Illustration across two use cases

For example, consider two often touted AR use cases. (1) AR powered goggles for guiding warehouse pickers. (2) Presenting visual build instructions to improve factory worker assembly Q&A and productivity.

Before jumping into piloting AR use-cases, consider the following critical questions:

Are there complementary technology requirements? Tiffany could deploy AR stations to improve jewelry assembly by presenting visual instructions. But, they may quickly find that machine learning vision is also needed to analyze the artisanal polishing and clasping activities in real time to drive true impact.

Is AI-powered robot automation a better alternative? Amazon may find leveraging AI to make its Kiva robots replace human pickers to be a more effective return on investment than AR goggles for employees.

Is the cost of deployment worth the benefit? Foxconn could improve its iPhone defect rate, but is the payback worth it to invest in tens of thousands of AR stations across its factories?

When considering the above use cases across three sectors, we find attractive ROI for only a handful of scenarios.

AR use case graph - Michael Hu

AI/VR could play a powerful role in future supply chain. However, initial use cases will focus on high and complex labor content areas. These use cases often require complementary tech capabilities (AI, IoT) to be mature and in-place to truly unlock the promised value.

Originally appeared in SupplyChainDive Influencer Roundtable

See the next blog in the series What is the case for computer vision in suppy chain?

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