Artificial intelligence (AI) is one of the most transformative technologies of our times. Impacting almost every organisation and field of work, it is at the forefront of what is being termed the ‘Fourth Industrial Revolution’.
As AI becomes increasingly integrated with business processes, it is important to know how procurement might change in the years to come. Here are some of the ways that AI could solve many issues in the industry:
Cognitive procurement advisors and virtual personal assistants
AI is enabling procurement leaders to use big data to help streamline procurement processes and to support the decisions they make. The technology can identify new markets, manage risks and even find the best suppliers. This can all help with cost reduction and ensure greater efficiency, much to the satisfaction of internal and external stakeholders.
Procurement technology vendors are developing programmes that allow AI to provide strategic sourcing solutions. Two AI systems that are currently being deployed include cognitive procurement advisors and virtual personal assistants. These systems make use of natural language processes and natural language generation which means that more procedures can be automatized. These systems can set alarms, retrieve information and complete transactions based on existing, past and predicted contexts.
AI in procurement is all about managing key tasks with improved efficiency, speed and simplicity. That is exactly what procurement bots offer. These digital systems are really where the ‘intelligence’ aspect of AI comes in, as they make use of machine learning which develops as it gains further experience. This means that they can comprehend and implement company policies and procedures in procurement, resulting in fewer errors and increased processing of invoices and payments.
Smart bots help procurement teams to become more efficient and work smarter. It is anticipated that these bots will bring about a complete transformation of procurement as a service, improving the user experience for staff, suppliers and vendors.
Getting the platform right
However, experts warn that artificial intelligence in procurement will only add value to an organisation if procurement leaders use the most suitable technology in the right platform, data and processes. To automate spend management, organisations should ensure that their existing tools are the best for the purpose and should make sure that the same systems are used across the organisation.
Ed founded Odesma in 2014 with the explicit intent of creating a new kind of procurement consultancy founded entirely on cloud principles. Deploying best-of-breed subject matter experts alongside the best on demand technology to deliver rapid and effective change for customers.