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News Room > Blog > What’s new in procurement technology?

What’s new in procurement technology?

Research estimates that procurement departments are spending up to 30% of their time on activities that prevent them from tackling the challenges that really matter- such as negotiating better contracts, achieving greater value for money, increasing spend under management and reducing risk.

Building a world class procurement function means driving ongoing behavioral and organisational change through clear strategic vision, supported by a strong foundation of people, processes, technology and information. We talked about transforming procurement in this value proposition.

 

Procurement trends

In recent years, there have been some procurement trends that are likely to become increasingly involved in everyday procurement processes. We are referring to of course; Artificial Intelligence, Robotic Process Automation and Machine Learning. These are some of the digital trends that are set to fundamentally influence and change the way we work.

Artificial Intelligence – provides a level of intelligence to technology. In procurement, as an example, this could be as simple as routing a contract or requisition to the right person based on value and type of spend. Going forward AI is going to revolutionise the way current procurement processes are made.

Machine learning – uses neural networks to analyse the specifics to a situation and based on its analysis makes a probability based decision or action. One of the differences between AI and Machine learning in procurement is that machine learning can learn and scale quicker than rules-based AI.

Robotic Process Automation – is a software that automates manual and repetitive tasks. Key to the definition of RPA is that it does not possess any form of intelligence. It requires no decision making or inherent knowledge.

 

Conclusion

All three technologies are evolving at a fast pace, increasing efficiency and effectiveness. Our view is that there is little point for the implementation of pure RPA in procurement – if used at all it will most likely be a stop gap whilst you strategise a more longer term solution. Applied RPA, AI and machine learning in the form of a Source to Pay platform is a much better option.

Are you thinking “How do I implement machine learning and AI in my procurement function?” We think this not the right way to start the journey. We support the technologies and their objectives, but we believe that the real question is “How do I get more value from my procurement function?” and the answer is likely to be, in part, focused on technology which helps increase effectiveness and efficiency.

 

At Xoomworks, we partner with a number of solution vendors that offer integrated RPA, AI and machine learning that can help your procurement effectiveness. We are able to provide independent advice based on your company needs and goals. Why not get in touch?

 

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