AI Agents: MZ Weekly Thread for February 17, 2025
Agentic AI in manufacturing supply chains: Very soon you will see a mad rush by manufacturers to add as much AI as possible. This week I discuss AI vendors and challenges creating and implementing effective, task-specific AI agents.
Manufacturers with established products today achieved most of their cost-cutting either working with contract manufacturer services, optimizing production and re-designing expensive packaging. Staff reductions and layoffs can also help some manufacturers cut costs but real savings in manufacturing operations and supply chain management will come from automated AI agents. Manufacturers quickly found out Industry 4.0, with manufacturing execution systems (MES) and IBM Watson, did not deliver as promised.
In my earlier research I could not locate one single IBM Watson customers who could directly attribute IBM Watson to saving that customer money.
"[W]e are one of the [EMS provider] companies who have worked with IBM. We had to find our own way because frankly, IBM over sold and overpriced Watson. Most of the folks I’ve worked on the project with at IBM have moved on to China firms like Alibaba and Baidu."
Today, IBM Watson AIOps 2.0 has risen from the ashes. I'm not as familiar with 2.0 as I should be to form an opinion. So what's next?
I predict there will soon be a mad rush by a lot of manufacturers to implement as much AI as possible.
The thing I keep hearing from manufacturers is they don't know where or how to go about implementing AI. A lot of them simply reach out to their ERP vendor like SAP, but even SAP is wonky and it doesn't understand manufacturing nuance, especially EMS manufacturing industry.
Other manufacturers might reach out to enterprise consulting firms like BCG or McKinsey but none these firms understand CM/EMS operations. They don't get their hands dirty. They bring in subject matter experts (SME). I know from first-hand experience.
Mark Zetter
As manufacturing grabs more headlines there are more conversations about AI in manufacturing board rooms. Lights out manufacturing is moving to the next level of detail and I predict an explosion of AI agentics applications with multi-agent systems designed for very specific tasks in manufacturing and supply chains on the horizon.
System-to-people agents vs system-to-system agents
AI agents are primarily of two types: system-to-people (platform interface) agents and system-to-system agents. Today's agents are primarily system-to-people because true system-to-system agents have not yet been fully perfected despite what many vendors claim.
There are a ton of AI agent companies for the supply chain, including product design, import/export compliance and, so on. Some have good ideas but they execute because of uninformed buyers, many are not narrowing their focus enough while others are not solving the right problems.
AI agents
Some questions for manufacturers to think about when looking for AI solutions; how do I identify problems suitable for multi-agent systems? How do I know which vendors can deliver agent solutions we need? Where should agent(s) be implemented in our supply chain? Which functional groups can benefit the most? Which activities and how can a multi-agent system benefit our supply chain? How do we assemble our agentics project team and monitor vendor progress?
Manufacturers are already talking with AI agent company sales people but these vendors are unable to close the deal often because sales people don't understand nuances in manufacturing supply chains so they are unable to sell agents into the enterprise - especially to manufacturers with extended contract electronics manufacturing supply chains.
For manufacturers wanting to get ahead of the AI agent curve, first, know that effective agents are independent entities that can perceive your manufacturing supply chain environment that it's in and then make decisions based on perceptions followed by taking actions to achieve specific task objectives and goals - capable of real, autonomous behavior.
To get started, find out which vendors are making agents for functional groups supporting manufacturing and find out which specific problems they are solving.
Can the agent scrub BOMs from anywhere in any language? Can the agent find alternate materials? Can it create a PDF?
Very soon all successful enterprise manufacturing supply chains will be sprinkled with task-specific, multi-agent systems.
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About
What matters when formulating contract electronic strategy? How do you identify supplier profit centers and what are you doing to protect against margin erosion for your outsourcing programs? Why do provider capabilities often not match capabilities they claim? How are you benchmarking your supply chain against competitors?
I’ve spent 25+ years in contract electronics industry setting up contract electronic divisions and running operations, protecting EMS program profits, manufacturing capacity M&A and more. I run a technology solutions firm. A lot of times this means asking the right questions.
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