Artificial intelligence always has been, is still, and possibly always will be a very hot topic. From theory to practicality, to cinematic wonder, and otherworldly possibility – artificial intelligence has been the focal point for a lot of great minds across fields and industries, for a long while. Today, though, AI is more heavily practiced and implemented than one might first think, and it’s already transformed many industries. For example, implementing AI in procurement technology amplified and optimized procurement organizations and activities, and essentially changed the game completely.
There are many aspects of the procurement lifecycle to which AI is applied and implemented in sophisticated procurement technology that most modern procurement teams are already utilizing, whether they realize it or not.
A Brief History of AI
While flashy artificial intelligence programs rolled out by large tech companies like Siri, Alexa, or the Google Assistant are all relatively new programs, artificial intelligence ( ai ) has actually been around much longer than the current renditions we see on the market and make use of every day. In fact, the first successful AI program was created in 1951. While the first AI program was far from the sophistication of what’s available on the market today, it truly launched the industry forward and acted as the first large step in the staircase of AI.
Since 1951, massive strides have been taken in the development and progression of artificial intelligence. With those bounds and leaps though, of course, came the speculation as well with widely popular movies such as, “Ex Machina”, “Archive”, “I-Robot”, “Extinction”, and even the documentary, “The Social Dilemma”. However, as rich as the entertainment industry is, AI’s progression, utility, and practicality are undeniable.
Modern AI is popularized by the masses with virtual assistants that have already been mentioned like Siri by Apple, Alexa by Amazon, and of course Google Play by Google. However, these virtual assistants programmed into our phones aren’t necessarily the height of artificial intelligence.
Artificial intelligence has a wide range of practical implementation across fields and industries, from medical research and practice to industrial data analysis, and much more. Another aspect of AI that makes it so valuable is its ability to integrate with other technologies and systems. By combining multiple technologies with the power of artificial intelligence, developers create sophisticated programs that revolutionize industries entirely.
AI in Procurement
AI in procurement completely changed the way spend analysis, data analysis, and data collection all happened regularly. One of the main areas that artificial intelligence is utilized in procurement is in contract management. This is because the AI can collect and analyze all of the data from the contracts in a fraction of the time that it would take to conduct manually. With AI at the wheel, though, the data from retired, existing, and potential contracts are easily collected, maintained, and analyzed; making it easy for your staff to process and utilize in decision making.
On top of data analytics, artificial intelligence can also identify errors or mistakes, pinging the user to take corrective action. By having this extra fail-safe implemented into your procurement program, your team is far more likely to catch and address errors before they cause any major issues.
Results and Benefits
Artificial intelligence has many practical uses in procurement and its implementation leads to a buffet of benefits. First up is efficiency. Implementing artificial intelligence into the procurement life cycle will immediately reduce the time constraint of necessary processes, like spend analytics and spend data. This, in turn, frees up additional employee time which can be allocated to more significant and impactful business activities.
Additionally, artificial intelligence brings about stronger contract management practices. In this way, artificial intelligence increases the value of your contract pipeline by assisting your staff in identifying valuable contracts, repetitive or redundant contracts, and invaluable contracts, based on an array of variables and factors. By weeding out the bad or invaluable contracts, the average value of your entire contract library innately increases.
Furthermore, AI-enabled procurement results in higher cost-savings in the contract negotiation phases, and a more robust and comprehensive procurement life cycle overall. AI is an important feature for any sophisticated procurement software worth its salt, and its implementation leads to a wide array of spend management solutions that would otherwise be completely unavailable.
A Quick Summary on AI in Procurement
AI is quite possibly one of the most important technologies to progress significantly in the modern scientific era. As such, it plays an extremely valuable role in many of the widespread technologies of today, across industries and fields. In procurement, AI is used for data collection and analysis, risk assessment, and in many other areas; ultimately resulting in higher rates of efficiency, production and strategic sourcing, stronger cost-savings, and a more valuable contract library.
For more information on AI procurement or anything related to the procurement life cycle, keep browsing ProcurePort. ProcurePort is the internet’s premier place for everything procurement, from knowledge and information to software and technology, and everything in between.