Many observers believe that emerging technologies such as artificial intelligence have the ability to transform the business world. That’s why business leaders are investigating these technologies, hoping to position their organizations well to benefit through faster innovation, reduced costs, and increased efficiency. This also has the potential to enhance procurement processes, and deliver greater value to end customers. Let’s find out how emerging technologies can make procurement smarter.
Provision of Intelligent Insights
One of the steps of intelligent procurement can involve the use of digital agents, e.g. chat bots, to deliver recommendations to procurement specialists in a proactive manner. A digital agent can be created to augment the knowledge and experience of buyers. They may be empowered to put big data insights into action without having to be data scientists themselves. With the use of AI, these technologies could also learn what actions lead to the most favorable outcomes and when the ideal time is for user engagement.
Making Procurement Analytics More Prescriptive
The move from basic-level automation to intelligent procurement should begin with understanding and capturing data in more detailed ways. A majority of today’s procurement analytics are only descriptive. For example, the data only tells you the monthly expenditures of a certain department, past trends in materials prices, or which suppliers are achieving their performance targets. Do keep in mind that as analytics continue to become more sophisticated, predictive models will inevitably become the norm.
What can you expect to happen? For starters, machine learning will be able to analyze data for hidden patterns, procurement can accurately predict departments that have a higher chance of overspending the next month, where raw materials prices are headed in the long run, and which suppliers will run into problems the next year. As this information continues to drive procurement strategy, you may have a wider variety of suppliers to choose from in the near future.
Allow People to Do What They Do Best
Automated technology can help to reduce time spent on mundane tasks. If you are looking for a solution that allows you to focus on more strategic work, automation is the answer. This can take place in the form of robotic process automation (RPA), where repeatable processes will be completed much faster. Today, you can find procurement technology designed for these tasks. They can tackle electronic procure-to-pay processes, provide digital search capabilities, and automate workflows.
While emerging technologies can reduce error and create efficiency, they are not always truly intelligent, and are actually just the first step. They currently work only for repetitive and predictable processes. They cannot truly provide people with recommendations about which actions to take. Don’t worry though; technology is definitely progressing, and will eventually reach a point where it has the ability to make decisions like a human being.
As you can see, intelligent procurement has the ability to aid professionals in the creation of differentiated supply chain outcomes. The ability to analyze and capture data is becoming increasingly critical to maintaining a competitive advantage. As you evaluate potential solutions to embrace digital transformation, you should think whether those solutions can provide the levels of access and detail you require to leverage on emerging capabilities.
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