Procurement: Five misconceptions about artificial intelligence

March 18th, 2021
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Some 46% of procurement leaders say that they would consider investing in artificial intelligence to optimise their processes[1].

But in too many cases, unfounded reticence means this never comes to fruition.

Five misconceptions in particular lead to the a priori rejection of artificial intelligence:

Misconception no. 1 on artificial intelligence: Robots will replace humans

What is true is that with AI (Artificial Intelligence), organisations increase their ability to analyse large amounts of data and learn useful lessons from it. What is also true is that AI enhances the ability to anticipate.

However, artificial intelligence offers no help with the fundamentals of the buying profession:

  • The opportunity to develop cooperation with suppliers by building a relationship of trust
  • Product innovation, through an analysis of the value shared with the operational divisions of the company

Artificial intelligence is a technology that allows people to take a step back from certain operations in favour of strengthening interpersonal relationships.  

Misconception no. 2 on artificial intelligence: Skills are downgraded

Artificial intelligence, and progress in general, are extremely useful in challenging certain procurement practices. Overall, AI provides the opportunity to accelerate calculation-based processes and make them more reliable. This is very important, but it does not constitute a disruption of all procurement processes.

So it's very far from extinguishing all the skills and experience accumulated within the teams. However, AI represents real progress in learning new purchasing knowledge.

Artificial intelligence adds new skills but does not in any way render current expertise obsolete.  

Misconception no. 3: The budget will skyrocket!

Sometimes it is claimed that AI takes up so much time and investment that its consumption of resources destroys any potential benefits.

But in reality, the opposite is true. Companies that use artificial intelligence actually save time and money:

  • They make the right decisions faster.
  • They save countless hours of work thanks to automation.
  • They free up time for tasks with a higher return on investment (ROI).

The feedback from procurement leaders is clear: Artificial intelligence makes companies more agile!

Misconception no. 4 on artificial intelligence: We're not ready yet

Innovation is continuous and artificial intelligence has yet to unleash its full transformative potential in the procurement sector. But if we wait too long, AI's pioneers may be too far ahead for us to catch up!

AI is now clearly part of the digital procurement toolkit. Getting involved and carrying out full-scale testing of certain AI applications is absolutely necessary to maintain its capacity for strategic contribution.

Misconception no. 5 on artificial intelligence: Other technologies are disposable

The digital transformation of procurement is a coherent process. And artificial intelligence is a part of it, taking its place but nothing more.

The strength of the latest generation of e-procurement solutions is integrating AI into numerous applications. And sometimes users don't fully appreciate that.

With software, as with people, artificial intelligence adds efficiency. It is not a substitute for what is already working well!

In conclusion, like all technologies, artificial intelligence should neither be considered a solution to all problems in procurement, nor be rejected without full scrutiny. Artificial intelligence is likely to find its place within all teams, managed by humans and assigned to tasks where its added value is obvious.

Xavier Laurent, Director of Value-Added Services at Manutan France, recently published an article that expands the debate on digitalisation as a whole. Read Procurement: Five clichés regarding its digital transformation.

[1] Study by the Hackett Group

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