Specialist procurement recruitment agencies seeking candidates for emerging procurement and supply chain jobs are likely to look for knowledge of Artificial Intelligence technology in 2019, as it is poised to revolutionise procurement processes soon, a new article in Procurement Leaders suggests.
While it takes time to digitalise a procurement department, evidence suggests that the results can be exceptional, moving procurement from the goods and services purchasing function of history, to the driving force of value-adding and cost reduction efforts. And AI is becoming a potent instrument in this procurement transformation process. For example, cloud-based AI solutions can boost the power of spend analytics to prioritise sourcing activity. Procurement practitioners can use it to compare data across anonymised companies in specified industries to pinpoint under and over-spends, matching spend patterns with demand profiles to help achieve more accurate insights for sourcing lotting strategies and supplier rationalisation.
The technology is evolving rapidly, encompassing more crucial procurement functions in its scope, including sourcing. It allows procurement pros to set qualification and assessment criteria for suppliers, not only weighting responses but also analysing combinations of items and lots. It can identify the best combination of suppliers and items, and generate fact-based recommendations for better value combinations, which human computational skills alone would almost certainly have overlooked.
AI is also beginning to improve efficiencies in transactional procurement, by streamlining purchasing and invoicing processes, as well as in the form of dynamic discounting, to achieve cost reductions and buttress supplier sustainability. It doesn’t stop there – AI is being used to generate pragmatic comparisons on similar items and provide recommendations founded on what others have purchased. It can also pinpoint what items an organisation buys at particular points of the day, month, and year, and then set up prompts asking practitioners if they’d like to buy them at the appropriate time.
AI is coming. And it’s set to transform procurement. If you are in procurement and are proficient in AI get in touch