In our recent article for Supply Chain 24/7, we examine how organizations can govern the use of artificial intelligence across procurement, logistics, compliance, and supplier management as AI takes on a larger role in supply chain decision-making.
As AI evolves from a support tool to a decision-maker and, in some cases, a fully autonomous process, businesses face increasing legal, regulatory, and operational risks. Importantly, the use of AI does not diminish an organization’s compliance obligations. Regulators, including the Federal Trade Commission, have made clear that existing consumer protection laws continue to apply to AI-driven business decisions.
We explain why companies should establish clear governance frameworks for high-risk AI activities, including supplier approvals, contract execution, and significant purchasing decisions. Effective oversight includes defined approval thresholds, meaningful human review, and ongoing testing to identify model drift, bias, or performance issues before they create larger supply chain disruptions.
While AI will continue to transform global supply chains, accountability remains with the businesses that deploy it. Organizations that pair automation with strong governance, human oversight, and thorough documentation will be better positioned to reduce risk, maintain compliance, and realize the benefits of AI.
Read the full article, “Supply Chain AI Needs More Than Automation. It Needs Guardrails,” published by Supply Chain 24/7. We also thank summer associate Adley Ragan for her contributions to this article.