Artificial Intelligence in Automobile Industry

According to Builtin, Artificial Intelligence can be defined as ,

Artificial intelligence (AI) is wide-ranging branch of computer science concerned with building smart machines capable of performing tasks that typically require human intelligence.

              From last few years Artificial Intelligence or AI became the hot topic and great career option for the many people.However, the idea of AI is not relatively new to the researchers,.There is no doubt that AI has the capability to impact our life. The question of in what level it will make an impact. And this is still in an imaginary scenario for the normal people.However, the researchers and subject matter experts can & has predicted the impact that AI will make in future. In 2018, AI expert Dr.Kai-FU Lee said that, "AI is going to change the world more than anything in the history of mankind.More than electricity."

           

            World's well known giant companies have started utilising and developing the products using AI.For example, Amazon came up with a AI based virtual assistant known as Alexa. With the combination of Sensors,cameras,Radar and Artificial Intelligence Tesla is working to develop the driverless cars,etc.

               In this article ,we will discuss in brief about the potential impact AI can make in Automotive industry. So,lets start.

# Engineering Design -

            Long back,Computer Aided Design (CAD) brought the revolutionary change in the way of creation,modification, analysis and optimization done in the designs. CAD helped to reduce the amount of time spent on manual design and drafting resulting into increased productivity,quality of design,ease of storage and document of the design records. Even though these technology greatly reduced labour work of human but its still dependent on human to create design and drafting work.

           With AI, I believe it possible to reduce more than 50 % of human intervetion in design and drafting of particular products.To understand, we will take an example of splined solid half shaft which is used in automobile differential for providing power to vehicle wheels. For CAD model, designer need to create a solid round shaft of particular length and then he will extrude the material for spline tooth creation. Suppose, with no calculations involved, designer takes appro.2 hr of time to design. Instead, with AI, we can create the CAD model of the same shaft in less than 15 minute just by entering required dimensional values like length of the shaft, diameter, spline and material details. AI will automatically generate a CAD model based on provided inputs.

            Various CAD software developers working on integration of AI in CAD softwares. In next 5-10 years, it is not surprise to see and use such a solutions in engineering design and drafting.

# Procurement -

            Procurement is an most critical and more focused function of any organisation.With  error free procurement, organisation can run its business more smoothly and can make more profits too.Artificial Intelligence already transforming procurement. With automating large time consuming processes, AI has the potential to rapidly change the procurement practices used around the world.Currently, it will be too early to say that all the procurement activities will be done by AI,because procurement is an complex,involves analytics and decision making. However, AI can be used in some lengthy and time consuming procurement activities like Spend Analysis, Vendor Search from large data,collecting market data,etc.

According to Sievo.com,below are the 7 common procurement areas where AI can be used.

7 common areas for AI in Procurement

(Source - https://sievo.com/resources/ai-in-procurement)

 

How Procurement works in Automotive Industry ? | Procurement Cycle | Words of Engineer

How Procurement works in Automotive Industry ?

Every organization requires material and services to fulfill their business needs.In Automotive industry, terms like Purchasing and Procurement are used interchangeably. However, they are  different from each another.Let's first understand the difference between Purchasing and Procurement.

What is Purchasing ?

    It can be defined as 'Process of buying materials and services from the suppliers or vendors'. Purchasing is part of procurement which includes the activities like Ordering,follow up, expedition, receiving of goods, verification of invoices and payment to suppliers.

Objectives of Purchasing -

Purchasing is responsible for maintaining smooth flow of material without interrupting the production.
If production is interrupted it can create a delay in delivery schedules which could affect customer satisfaction and can result in business losses.So, objectives of purchasing can be defined as ' obtaining materials or services of right quantity, right quality at right time,right place and at most economical prices'.

What is Procurement ?

Procurement is wider term which includes the activities prior to the purchasing such as Identification of need,supplier selection, creating purchasing orders /agreements, negotiations and maintaining supplier relationship,ect.

Procurement Cycle -

Procurement Cycle consist of steps shown in below snap -

1. Determination of Material Required.
  
    Procurement activity starts with material or service requirements initiated by manufacturing department. This requirement consist of what material or services needed, how much quantity needed, when it is needed. Then procurement team analyze the requirement and finds the potential suppliers who can fulfill the requirement.

2. Request for Quotations (RFQ)

   After list of potential suppliers are selected from organization's approved vendor list, team sends a request stating the requirements and asks for the supplier's price,terms and conditions to provide material or service. So, RFQ is not an order ,it is just an enquiry.

3. Vendor Selection 

    As soon as RFQ received from suppliers, procurement team analyze the different Vendors price,terms and conditions. Finally selects the best suitable vendor for the organization to fulfill requirement.

4. Creation of Purchase Order (PO)

   Purchasing order is a legal document acts as contract between the organization and vendor. It consists of information about the material or services like price, what to supply ,how much ,when to supply, mutually agreed terms and conditions.

5. Receiving and Accepting goods

   After receiving the goods to organization premises, responsiblility of accepting and posting good receipt in organization's ERP system.

6. Verification of Invoices

   Vendor sends an invoices for the goods supplied to organization. Team in responsible to verify those invoices with goods receipt quantity and price mentioned in PO.
 
7. Payment to Vendors

   If verification is done & invoice information are correct then team sends a request to finance team to release payments.

So, this is about how purchasing and procurement works in Automotive industry.