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VentureBeat Homepage * The Machine * GamesBeat * Jobs * Special Issue Account Settings Log Out Become a Member Sign In VentureBeat Homepage The Machine Making sense of AI * * VENTUREBEAT * AR/VR * Big Data * Cloud * Commerce * Dev * Enterprise * Entrepreneur * Marketing * Media * Mobile * Security * Social * Transportation FOLLOW follow us on Twitter follow us on Facebook follow us on LinkedIn Follow us on RSS THE MACHINE * AI * Machine Learning * Computer Vision * Natural Language Processing * Robotic Process Automation FOLLOW Follow us on RSS GAMESBEAT * Games * Esports * PC Gaming FOLLOW follow us on Twitter Follow us on RSS EVENTS * Upcoming * Transform * Media Partner * Webinars GENERAL * Newsletters * Got a news tip? * Advertise * Press Releases * Guest Posts * Deals * Jobs * VB Lab * About * Contact * Privacy Policy × JOIN THE VENTUREBEAT COMMUNITY FREE: JOIN THE VENTUREBEAT COMMUNITY FOR ACCESS TO 3 PREMIUM POSTS OR VIDEOS A MONTH. Learn More SIGN UP WITH YOUR BUSINESS E-MAIL TO CONTINUE WITH TICKET PURCHASE Please wait... SHARE * Share on Facebook * Share on Twitter * Share on LinkedIn * VentureBeat Homepage * Social Links * Newsletters * Events * Profile KOHL’S CTO ON EMPOWERING PEOPLE AND OPTIMIZING SUPPLY CHAIN WITH AI Zachariah Chou July 21, 2021 10:20 AM * Share on Facebook * Share on Twitter * Share on LinkedIn HOW OPEN API STANDARDS WILL TRANSFORM FINANCIAL SERVICES Open standards will have a huge impact on driving innovation in banking. Learn the status in the U.S. – and the bold new opportunities open standards are set to usher in. Register here The Transform Technology Summits start October 13th with Low-Code/No Code: Enabling Enterprise Agility. Register now! -------------------------------------------------------------------------------- Say you have a product at a store you want customers to be able to grab off the shelf and buy. How do you balance that with selling the same inventory to people ordering online? How do you decide how much of your inventory you sell online? When someone makes an order online, how do you decide whether to fulfill the order with inventory from stores or your company’s warehouses? These are just some of the many questions that retail giant Kohl’s wrestled with. The answer the retailer came to, according to Paul Gaffney, Kohl’s chief technology and supply chain officer, was to let AI take a shot at the decision-making. 1 / 21 Cloud to survive. AI to thrive. -- How CXOs are navigating the path to Data Driven Reinvention 1 Read More Video Player is loading. Play Video Unmute Duration 0:48 / Current Time 0:04 Advanced Settings Loaded: 24.78% 0:04 Remaining Time -0:44 FullscreenPauseUp Next This is a modal window. Beginning of dialog window. Escape will cancel and close the window. TextColorWhiteBlackRedGreenBlueYellowMagentaCyanTransparencyOpaqueSemi-TransparentBackgroundColorBlackWhiteRedGreenBlueYellowMagentaCyanTransparencyOpaqueSemi-TransparentTransparentWindowColorBlackWhiteRedGreenBlueYellowMagentaCyanTransparencyTransparentSemi-TransparentOpaque Font Size50%75%100%125%150%175%200%300%400%Text Edge StyleNoneRaisedDepressedUniformDropshadowFont FamilyProportional Sans-SerifMonospace Sans-SerifProportional SerifMonospace SerifCasualScriptSmall Caps Reset restore all settings to the default valuesDone Close Modal Dialog End of dialog window. Settings Playback Speed Normal Video Quality Auto (360p) Replay the list * Powered by AnyClip * Privacy Policy TOP ARTICLES Cloud to survive. AI to thrive. -- How CXOs are navigating the path to Data Driven Reinvention 1 “When you start allowing machine learning algorithms to make decisions, they sometimes make decisions that aren’t intuitive. They aren’t what the people would make,” Gaffney said. AI MAKES A DECISION Usually, the deciding factor when trying to pick where to ship from would be shipping costs, Gaffney said at VentureBeat’s Transform 2021 virtual summit. However, it also became clear to the company that when an item was left in inventory at a location where it takes longer to sell, it will eventually wind up being marked down, and that would hurt the bottom line. “We had this nagging suspicion we were incurring more markdowns than we needed to. Could we be smarter and say, ‘Hey, how about if we sell the merchandise that we might have placed months ago in a spot where we now know it’s probably not going to sell in that store … so let’s pick it from that store and avoid the future markdown,'” Gaffney said. Kohl’s turned to partners to develop solutions for their supply chain optimization. Then came the leap of faith. “What opened a bunch of doors for us was the willingness to say, ‘OK, we’re willing to risk a certain amount of money in the belief in the algorithm, and even if it doesn’t work, that investment in learning was good enough,'” Gaffney said. “And it turned out that it paid off.” With successes in hand, Kohl’s is reflecting on its usage of AI, developing their in-house capability to exercise more control over their AI tools, and also considering further ways to optimize their stores beyond backend inventory management. For example, the data showed that each store has a different make up of customers, so the AI decides what kind of things to display to account for the different group of customers. Allowing the algorithm to suggest making changes to the products on sale at different stores based on customer data, resulted in “enormous positive upside,” said Gaffney. HUMAN EXPERIENCE People should “educate themselves” on what machine learning can do, but also to understand how these advanced technologies can disrupt people’s work patterns. Enterprises need to think about ways to “purposefully re-engage” people in activities that aren’t conducive to machine learning. “It’s tempting to treat the adoption of machine learning AI and big data as a technical problem,” Gaffney said. “But it is much more so a human change management problem as well.” VENTUREBEAT VentureBeat's mission is to be a digital town square for technical decision-makers to gain knowledge about transformative technology and transact. Our site delivers essential information on data technologies and strategies to guide you as you lead your organizations. We invite you to become a member of our community, to access: * up-to-date information on the subjects of interest to you * our newsletters * gated thought-leader content and discounted access to our prized events, such as Transform 2021: Learn More * networking features, and more Become a member FIND YOUR DREAM JOB ON VENTUREBEAT CAREERS Slack Dublin View 62 Jobs Workday May Lane View 20 Jobs CGI Group, Inc. Amsterdam View 1668 Jobs Checkout.com United Kingdom View 270 Jobs TRANSFORM 2021 Join us for the world’s leading event on applied AI for enterprise business & technology decision-makers, presented by the #1 publisher of AI coverage. 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