June 16th, 2022
For procurement pros wondering if the game-changing power of AI would come to their corner of the enterprise, we have good news, scores of AI-powered procurement apps have arrived!
AI procurement apps are already being used to offer lightning-fast analyses of company databases, enabling buyers to discover better, revenue-saving ways to source the goods and services their companies need.
AI has also been implemented to automate many time-consuming tasks that were previously handled manually, such as reports and evaluations of monthly processes, specific wins scored by procurement pros and more.
This program’s ability to drill down into massive databases, across business units and the world is also enabling procurement pros to identify new suppliers they can use to help run companies more effectively and at a cost much lower than before.
For an up-close look at how AI can transform the work of procurement pros, consider AI apps that are already being utilized to auto-analyze business contracts that procurement departments work with daily.
Those apps can uncover fees and payment terms associated with those contracts, find the end dates of agreements or similar time sensitive information and highlight options for re-negotiating key terms.
Prior to the emergence of AI in procurement, such insights were mostly beyond the reach of procurement professionals. Many contracts only existed in hard copy form stored in non-networked PCs or mainframes not easily accessible to procurement, or similarly blocked from procurement altogether.
But with AI, along with the digitization and merging of all records of company contracts, procurement professionals are now able to quickly run AI analyses on all contracts to find patterns, anomalies and insights associated with the contract data that was simply unavailable to them without the tech.
Let’s take a look at what AI applications are currently available for procurement professionals in order to understand just how helpful AI can be!
Procurement professionals are now able to unleash AI apps that can slice-and-dice how a huge enterprise is spending cash in very specific ways. AI apps, for example, can be designed to instantly categorize all the different suppliers the company uses for core materials across the globe. It can also analyze pricing and switch to a smaller group of suppliers who might have a lesser financial impact on logistics and last-mile delivery needs.
Virtually every procurement department has been impacted by the supply chain challenges brought on by COVID-19. However, the procurement professionals who were already utilizing AI applications were able to quickly pinpoint the suppliers who were most impacted by the virus. And by monitoring supplier signals on social media, they were able to identify other suppliers that had found logistical solutions around the pandemic to serve customers with little to no delay.
Again, many procurement pros saw and continue to see prices soar due to the impact of COVID-19 and more recently, the fallout from the war in Ukraine. But procurement departments using AI apps are able to auto-analyze in real-time the pricing for a particular commodity, part, semi-conductor or other company needed so they can jump from a supplier that has raised rates overnight to a competing supplier that has been able to hold back price increases.
While some procurement pros are still stuck manually reviewing invoices prior to payments, others have been able to turn that approval process over to AI auto-invoice processing, therefore saving time and money for the company to use in more creative ways.
The AI applications that already exist can be custom-programmed to relentlessly scan payment workflows for the tiniest sign of fraud or potential fraud. Unlike humans, AI-driven fraud detection apps never get tired, bleary-eyed, or distracted. Instead, they can be programmed to scan for as many indicators of fraud as any procurement department wishes, forever standing guard over would-be thieves, 24/7.
Thanks to virtually limitless data served-up by the internet, AI supplier discovery apps can be merged seamlessly with the web to continuously uncover potential new suppliers for a business, which fulfill every single feature that procurement desires, including lower prices.
Of course, given the subtle differences in usability and the relative prowess, AI-driven procurement apps are looking to win favor with procurement professionals across the board. If you are looking to give AI-powered procurement a try, you can survey the market with an AI consultant who is already intimately familiar with what each app can or cannot do for your company, and can suggest when a custom solution is your best move.