The ABC of future procurement: A is for…AI
In this blog series, WorkFutures founders Eleanor and Rosalyn take a look at the ABC of technologies that will have the most profound effect on the face of procurement in the rest of 2018 and beyond. First up, Artificial Intelligence.
In many industries, crucial supplier intelligence and information about how a market functions or how a business works can often be kept with one individual or a small team working on specific projects, on a fairly unhelpful ‘need-to-know’ basis. While this can lead to highly skilled and savvy professionals, it means that businesses must solely rely on an individual’s brainpower, desire and ability to achieve optimum deals, contracts and supplier relationships, not forgetting innovation.
In 2018 and beyond, by incorporating AI into the profession, procurement pros can find new patterns in markets to access more in-depth product and supplier information. This will allow for both deeper insight and understanding into a supplier, improve individual existing skills around sourcing and spending, and promote, all important, collaboration with business stakeholders.
The data game
In procurement, the data harnessing capabilities of AI will enable businesses to have better insight into their spending and the goods they’re purchasing, which will inevitably lead to better decision making in the long term. AI analytics will support designated sourcing strategies, informed and repeatable execution of deals between businesses and improved management of existing contracts. Used in conjunction with intelligent professionals, AI has the potential to reshape the face of procurement around the world.
If procurement pros are prepared to embrace the ability of the AI analytics to support the design of sourcing strategies, then execution of deals and the management of contracts through to success will become far simpler and more rewarding. That said, the really adept will need to have a more mature and systematic approach to ensuring accurate capture and inputting of data in order to get the best out of future data analytics. To make the most of AI, human workers have to give it the best ‘raw materials’.
AI – opening doors for collaboration
Additionally, there will be an increasing role for improved collaboration with data scientists to best drive AI and analytics to support decision making. Successful sourcing professionals will be able to incorporate the use of AI in providing patterns in market, product and supplier information in their skills arsenal, and use the insight as a complementary tool to their own deep understanding and experience.
The big idea for AI in procurement is that being armed with significantly improved market intelligence will let the procurement professional access greater opportunities to influence the business stakeholders in the spend decision making process. And with the advent of AI, procurement and sourcing professionals will almost certainly enjoy a diminishing level of tactical activities in their day to day role, which frees up working hours. Who wouldn’t want that?