At this year’s ProcureCon Indirect East I had the opportunity to talk with dozens of leaders who were exploring ways to leverage AI to transform procurement from an organization focused on cost reduction to one that creates new opportunities for growth.
Many were overwhelmed by the different kinds of technology available. How do you incorporate a complex technology like AI and come away with something that creates value right away – not several months from now? That was one of the key questions my fellow panelist, Michael Heeger (head of procurement in the Americas for Deutsche bank) and I addressed in a panel discussion entitled: “Moving Beyond the Buzz: Leveraging AI and Cognitive Procurement.” For those of you thinking of incorporating AI into your procurement process, here’s a few highlights from our response.
The traditional function of procurement was to enforce a set of processes to prevent employees from making irresponsible or unwise spending decisions. It’s the quickest path to saving money. But today, our customers tell me that they are being asked to provide strategic value above and beyond cost savings and reduction. With so many technologies at your disposal, where do you start? Here’s a few ways to get the ball rolling.
4 Simple Steps you can take to Modernize Procurement
1. Start with a little house cleaning
Automating the data cleansing and normalization process is a great place to start. Once you have confidence that your data is clean and normalized, your procurement organization can focus on driving initiatives with a strategic value.
2. Use technology to empower employees
Transforming procurement from a department that’s expected to rubber stamp deals to a forward-thinking organization is a profound change. It has a positive impact on finance, sales, operations – nearly every functional area of the business. For the sake of establishing long-term relationships, it’s important to involve everyone – beginning with your team.
In our discussion, Michael talked about his commitment to empowering his employees. Not only is employee empowerment necessary to drive change, it’s a byproduct of changes you are making. Michael put it this way:
“Not only will your team be more productive in their everyday tasks, you’ll be giving them the tools they need to perform higher value work. That’s exactly what my C-level colleagues want to see from my department.”
– Michael Heeger, Head of Procurement, Americas Deutsche bank
3. Choose the right technical foundation
Instead of a reactive approach to cost savings, Suplari’s AI platform provides a systematic, automated and efficient way to identify opportunities for cost-risk-compliance optimization. There’s no need to replace your existing ERP or Spend Analytic systems, and there’s no lengthy implementation process. Most of our customers start with just one or two spend categories. Before long, they’re experiencing dramatic productivity gains.
It’s been very satisfying for me to see the growth our customers achieve using our technology. Once the procurement team is liberated from doing repetitive tasks like normalizing data, they can proactively seek out opportunities to reduce cost and improve compliance.
4. Big changes begin with a few small steps
I think anyone who attended ProcureCon would agree it’s an exciting time to be in working in procurement! With our platform for procurement and finance, productivity gains like these like these aren’t just for global enterprises like Deutsche bank. They’re available to any procurement professional with the foresight to embrace new technologies and empower their staff. One last piece of advice from Michael:
“Don’t be overly cautious. Go out and do it. Identify a few use cases. Try the technology. Measure the results. This isn’t rocket science, this is about applying technology that’s already out there to the work that procurement organizations do every day.”
– Michael Heeger, Head of Procurement, Deutsche bank
Get in touch with us to schedule a time to see a demo, or just reach out to us to ask a few questions. We’re happy to help in any way we can.