In a recent McKinsey podcast, John Straw, Senior Adviser and Disruptive Technologies Specialist at McKinsey & Company, outlined the importance of Artificial Intelligence (AI) technology for businesses in the consumer packaged goods (CPG) sector. According to Straw, investing in AI is no longer an optional endeavour if CPG firms want to remain competitive and secure their future growth. He emphasised that AI technology is absolutely essential for businesses in this sector if they hope to survive in today’s ever-changing digital landscape.
This paper seeks to explore the implications of the emergence of artificial intelligence (AI) in the consumer packaged goods (CPG) industry, as well as the challenges and opportunities it presents for the industry’s growth. It will also consider the potential consequences of this trend on the CPG sector as a whole. By assessing the potential benefits and drawbacks of AI in the CPG sector, this paper will attempt to provide a comprehensive overview of the current landscape.
The pandemic’s influence on the CPG sector
2020 was a significant turning point for the CPG industry, with a number of challenges that would have caused great concern for the Chief Executive Officer, Chief Operating Officer, and Chief Financial Officer. With drastic changes in both demand and supply, it was difficult for business executives to accurately calculate market projections, predict performance, and estimate revenue.
Despite the negative economic impacts of the pandemic, recent research conducted by McKinsey has revealed that the Consumer Packaged Goods (CPG) sector experienced strong growth in 2020, demonstrating a higher rate of growth than in the four years preceding it from 2016 to 2019.
Isn’t it amazing?
This expansion indicates the market’s enormous technological innovation change.
According to a recent report, CPG industry leaders need to consider various critical aspects for successful navigation of the current changing landscape. These include having an understanding of the cost outlook for 2021, ensuring that conversations about resiliency are a priority for the C-suite, balancing the need to capture growth with the need to control costs, and adapting marketing and customer loyalty programs to the changing circumstances.
Adapting to this changing environment will lead to an increase in the need for strong engineering expertise in the CPG business.
Opportunities in the CPG business
With each passing day, technological developments generate new possibilities for CPG merchants.
But what exactly do we mean by technological innovations?
The utilisation of Artificial Intelligence (AI), Blockchain, the Internet of Things (IoT), and Cloud technology enables businesses to provide their customers with a personalised, timely, and localised experience. A recent survey has revealed that 65 percent of customers have changed their brand loyalty in the past year due to product unavailability. AI, Blockchain, and IoT can be instrumental in tackling the problem of stockouts and ensuring products are always available for customers.
If you fail to provide adequate service for the technological components within your CPG store, you will be at a severe disadvantage in comparison to your competition. Not having the capacity to service these parts of your business could put you at a major disadvantage in the market.
What are the current difficulties for CPG industry leaders?
CPG executives must deal with a variety of issues on a daily basis, from recruiting the proper people to launching digital innovation initiatives.
The CPG sector has a large international presence when it comes to conducting business, which is reflected in the supply chains of each CPG company. Despite this international reach, the recruitment strategies of these firms remain predominantly localised.
This recruiting limitation stems from the legal problems of only doing business or employing in areas where you have a legal presence.
As a consequence, consumer packaged goods (CPG) companies face various difficulties in finding suitable AI and blockchain developers when they need to recruit them. This includes locating the right people who have the necessary skills and expertise within a timely manner.
Finding the right technical talent has been a significant challenge for CPG companies, as they are constantly competing with the big tech giants for the best and brightest. These larger companies have a well-established reputation for being able to recruit the most talented individuals, and this makes it difficult for CPGs to acquire the same level of expertise.
To summarise, the CPG business faces the following challenges:
First and foremost, the local talent pool is limited.
The second challenge is stiff rivalry in the IT sector.
The third challenge is that dial-in recruiting is a time-consuming procedure.
As a result, CPG sector executives are today confronted with three challenges: how, when, and where they will accelerate their innovation.
How can Works position itself to assist these CPG industry leaders?
In the contemporary world, remote control is becoming increasingly pervasive. All organisations are striving to benefit from the advantages of access to remote technical acumen. To this end, Works has developed an innovative Talent Cloud comprised of seasoned engineers who have been rigorously verified on more than one hundred technology stacks to the exacting standards of Silicon Valley. Works’ platform leverages Artificial Intelligence to guarantee that users are provided with the ideal engineers on a monthly basis, irrespective of their global location.
But how does this affect the customer?
Significantly decreased recruiting time, engineering velocity, and reliance on third-party providers?Consumer Packaged Goods (CPG) sector executives will no longer have to endure a protracted process to source top-tier developers due to Works’ Intelligent Talent Cloud. They can now rely on Works to quickly and efficiently identify and pair them with the most suitable engineers in less than a week, thereby circumventing the need to involve service suppliers or recruiting operations teams.
Excellent administrative assistanceAt Works, we understand the importance of ensuring time zone overlap, transparency, and dependable communication between the developer and the business after a successful match. Our platform is designed to handle all aspects of international human resources and payroll, and provides a secure platform for managers and engineers to interact, while abstracting away any complex issues associated with employing staff overseas.
Access to an unlimited talent poolWorks enables Consumer Packaged Goods (CPG) companies to access a global pool of top-tier engineering talent. Our Intelligent Talent Cloud is designed to unlock the world’s untapped potential, enabling businesses to recruit from over a million engineers from 140 countries and with proficiency in over 100 programming languages. This eliminates the need for businesses to be limited to only the talent available in a certain geographic area, allowing them to make the best hires for their organisation.
Projects that keep on scheduleDue to a lack of appropriate resources, many initiatives are being hindered in their progress and development. Fortunately, Works makes it easier for project directors to facilitate remote development in a timely, compliant and secure manner; thus, they can go ahead with the project without having to worry about the schedule being disrupted.
Works is aiming to provide a unique service to the CPG industry with its Intelligent Talent Cloud. By utilising Works, businesses can quickly and easily assemble a team of highly-skilled engineers to assist in launching their technological innovation projects within the desired timeline. This could have a considerable effect on the success and reputation of the company.