This interview is part of our new AI in Supply Chain Management series, where we interview the world's top thought leaders on the front lines of the intersections between AI and supply chain management.
In this interview, we speak with Richard Lebovitz, Founder and CEO of LeanDNA, to understand how his company is using AI to transform supply chains, and what the future of supply chains holds.
1. What’s the story behind LeanDNA? Why and how did you begin?
RL: I’ve worked in lean manufacturing and supply chain for 25 years. Bringing together that domain expertise with the ability to create advanced software applications, I wanted to target two of the biggest challenges facing manufacturing: improving on-time delivery while reducing inventory. Manufacturing companies were trying to wrap their arms around inventory optimization, often spending hours building and analyzing homegrown spreadsheets. People were working on weekends and waking up at 4 a.m. to manage these reports… and executives had no visibility into all of their sites’ performance. In this massive age of digitalization, it felt like the supply chain industry, and particularly procurement, got left behind. There were no shiny new solutions or technological advancements aimed at the industry that keeps the world’s production running. We believe advancements in supply chains are pivotal for reducing global waste and keeping production as efficient as possible.
So I brought in lean manufacturing and supply chain experts to help solve this problem, and together we built the LeanDNA technology to automate inventory operations for factories. We launched the product a little over four years ago, and now our software is being used by some of the largest manufacturing companies in the world to reduce inventory, free up cash, improve customer delivery, and hopefully make an impact on global waste reduction.
2. Please describe your use case and how LeanDNA uses artificial intelligence:
RL: The top challenge our customers face is predicting future shortages and inventory opportunities, and then prioritizing the top actions that will have the biggest impact on their on-time delivery and inventory reduction goals. It is by no means a new problem, but traditional spreadsheets and BI toolkits can no longer handle the needs of today’s complex supply chains. World-class manufacturers are more interested in how to improve the future versus just reporting past results. Our AI engine prioritizes actions so each user sees the most critical actions every day, and each action is tied to a monetary value of potential savings. We’ve seen that working on the top five to ten actions each day creates a huge impact for our clients after only one month.
We also know that trusting their data is pivotal for these teams, so LeanDNA has pre-built workflows and dashboards to help uncover the root causes of shortages, process breakdowns, and any data discrepancies. The teams and suppliers can then collaborate within the tool to get them resolved.
3. Could you share a specific customer/user that benefits from what you offer? What has LeanDNA done for them?
RL: At the end of the day, LeanDNA and its AI machine saves manufacturers money and prevents production slowdowns that cause late deliveries. As an example, within the first 6 months with LeanDNA, Zodiac Aerospace, an international manufacturer, reported an $80 million reduction in working capital due to managing inventory through the LeanDNA platform. The sites using LeanDNA also achieved over 90 percent of deliveries on-time, where previously they were reaching between 70 and 80 percent. With Zodiac and others, our service improves visibility across their operation for cross-functional teams and suppliers, reduces the amount of time analysts spend writing and analyzing reports, and shifts the organizational focus to efficient actions with the most impact.
We also hear from our customers that the visibility they gain in LeanDNA alone is an instant value and game changer for their organization—visibility of their data, their inventory, and their team’s actions. It allows them to see and react quickly to changing customer demands. Everything else after that is forward thinking and predictive, and propels the supply chain industry forward.