Artificial intelligence is a proper performance driver that is already being employed in a variety of businesses and industries, but it still has a lot of room for growth.
As we move forward, the potential for AI technologies is becoming clearer in procurement, and it is affecting every cycle from information processing to service quality. Let’s see what AI can accomplish.
Processing procurement data using AI
To begin with, artificial intelligence can handle data from a range of sources, such as online catalogs, customer relationship management software (CRM), contracts, and more.
AI, which is composed of algorithms, can analyze and use this real-time data, aggregate and replicate data automatically, and index it. Buyers can employ tools that leverage this technology to constantly monitor and utilize data at every point of the supply chain process, from selecting suppliers to executing agreements, placing and planning orders, tracking receipt and invoicing, etc.
Improving procurement processes using AI
Data collection and analysis will provide huge value for the procure-to-pay chain and improve all aspects, including procurement management, supplier relationship, and performance optimization.
Artificial intelligence may organize purchases based on specified criteria and product types according to a set procedure. When an internal client submits a demand, the software can determine whether it is covered by a catalog or a supplier contract, whether an estimate from a supplier is needed, or whether we should consider sourcing.
Different facets of the supplier relationship, including risk management, can be handled by AI. By tracking the supplier contracts timeline and the suppliers’ standard of work, for instance, the system can inform users if deadlines are not met, or a promise is not kept.
Buyers can also use AI to better monitor procurement performance by providing insight into costs, improving decision-making, and proactively generating reports and tailored dashboards based on the target audience.
The Bottom Line
There is no hiding the fact that AI is here to stay. The easiest way to avoid being left behind is to accept change, not resist it. Why? Because whether you want to or not, artificial intelligence and technology in general will play a vital role in procurement.
So, it’s better to keep up with the race and use effective procurement solutions that are flexible enough to meet your company’s goals and needs. We at Penny can provide you with such procurement solutions. Just contact us and see for yourself.