AI changes procurement roles

The rise of Artificial Intelligence (AI) is having a significant impact on the procurement process and will change traditional procurement roles. In fact, according to analyst firm Gartner, AI is the innovation within Procurement. This development will affect not only tactical procurement processes, but also operational procurement and invoice processing.

AI offers the ability to simulate human capability with computer systems, enabling the development of smart applications that make the procurement process more efficient. It is therefore crucial that both procurement and finance departments are aware of the potential of AI and the changes it will bring. Indeed, traditional procurement roles will change and new roles will emerge focused on working with AI. This requires not only new skills and knowledge, but also a different mindset.

For example, AI can be used to predict supplier performance and improve contract management. In addition, it can help automate repetitive tasks, such as price comparisons and compliance checks. This allows procurement professionals to spend more time on strategic tasks, such as maintaining relationships with suppliers and developing new purchasing strategies.

A key challenge in working with AI is ensuring ethics and avoiding bias. It is therefore essential that organizations are aware of the potential risks and take appropriate measures to minimize them.

Strategic procurement role

Developments in Artificial Intelligence (AI) are not only having an impact on the procurement process, it is also causing shifts in the roles of procurement professionals. Companies, such as Croonwolter&dros, are already implementing AI, and employees on the order desk know that their work will soon be different. This is a result of AI focusing on automating operational tasks, creating space for tactical tasks.

Björn Smeets, director of Purchasing and Logistics at Croonwolter&dros, emphasizes the importance of involving employees in these changes and stimulating their inventiveness. This gives employees the opportunity to play a role in the supplier onboarding process and in steering in supplier selection, changing their current operational role into a more tactical role.

This shift to more tactical procurement roles is a logical consequence of the application of AI in the procurement process. Procurement professionals can now focus on strategic tasks, such as maintaining relationships with suppliers and developing new purchasing strategies, while AI automates operational tasks. This makes the procurement process more efficient and creates more room for strategic decisions.

Procurement professionals must be aware of these changes and continue to develop in new technologies and skills. The use of AI opens up opportunities to optimize the procurement process, but it is still humans who are in control of the process and ultimately make the strategic decisions. It is therefore important to continue investing in the development of procurement professionals so that they can make the most of the opportunities of AI and move the organization forward.

Quick answers for suppliers

AI is changing the way the procurement process works. One application of AI is virtual assistants, such as chatbots. Using natural language processing technology, chatbots can interact independently with suppliers and conduct simple conversations or answer simple questions. This allows suppliers to be helped quickly and efficiently without the intervention of a human employee. This has implications for procurement roles within organizations, where employees who were previously responsible for answering supplier questions may now take on a different role.

It is important for procurement professionals to find the right balance between automated and human tasks because chatbots are not suitable for all tasks. Complex questions or tasks still require human intervention.

AI enables more accurate forecasts of supplier performance, allowing procurement professionals to be proactive and prevent problems before they occur. Therefore, it is important for procurement and finance departments to be aware of the opportunities offered by AI and continue to develop new technologies and skills.

User-friendly ordering process

An example of how AI can change the procurement process can be found at Croonwolter&dros. Here, mechanics can take a picture of a defective product with their smartphone, after which the platform automatically identifies the supplier and suggests a durable, packaging-free replacement. This process is made possible by AI and machine learning.

This not only makes the ordering process more efficient but also more customer-oriented. In addition, the system can make suggestions for additional products the technician may need. This leads to an improved customer experience and efficiency within the purchasing process.

Croonwolter&dros expects that voice-activated ordering will be implemented in the future, where the technician can place orders using Alexa or Siri, for example. However, it is important to remember that human involvement will still be needed for decision making and prioritization, for example when choosing the delivery option. AI can optimize the procurement process, but ultimately human input still matters.

Creating efficient purchase orders

Machine learning is applied to combine search results with final orders and make better suggestions for catalog items. This improves the user experience of the ordering application and reduces training time for new users. In addition, purchasing systems can create purchase orders themselves based on historical data, allowing organizations to save costs on transportation and take advantage of volume discounts.

Although some people worry that their jobs will be completely taken over by robots in the future, human direction and involvement will still be needed. AI takes away manual, repetitive tasks and automates the process from order to payment, allowing procurement professionals to spend more time on strategic tasks.

However, it is important for procurement professionals to be aware of the potential of AI and the changes it brings to traditional procurement roles. By finding the right balance between AI and human involvement, organizations can make the most of the benefits of this new technology.

Non-order related invoices

AI also has a big impact on the Accounts Payable department. The manual processing of non-order-related invoices is a time-consuming process that involves a lot of administrative work. Fortunately, the use of AI offers a solution: with smart coding technology, non-order-related invoices can be booked automatically. The system uses historical invoices to automatically apply the most similar coding structure to new invoices. This allows the system to automatically determine which cost account to use for each invoice, without employee intervention. This significantly reduces the risk of errors and is fast and accurate.

By using AI, invoices can be processed faster, saving time and costs. In addition, employees can now focus on other work. Because non-order-related invoices are booked automatically, there is also less chance of errors and employees have to spend less time correcting errors. This results in fewer unnecessary costs and ensures faster payment, which improves cash flow and reduces problems with payments.

This technology can also help improve the purchasing process. By automatically booking invoices, the system can gain insight into an organization's purchasing patterns and habits. For example, this can help identify savings and find optimization opportunities within the purchasing process.

Automatic invoice matching

Although digital invoice submission is on the rise, there are still many suppliers who cannot submit digitally. The good news is that this process is on the move and much progress has already been made. Croonwolter&dros, for example, is already using the Basware Network, to which a hundred of their suppliers are connected, and together these suppliers are responsible for 80 percent of orders. This shows that more and more suppliers are recognizing the benefits of digital delivery and more suppliers will follow in the future. 

With the necessary efforts of procurement professionals, the procurement process will eventually be able to be fully automated. Procurement professionals must encourage suppliers to join the platform and agree on digital invoice delivery. Building and maintaining good relationships with suppliers is very important here.

It is positive to see the potential of AI being embraced within the procurement process. By combining human interaction with the power of AI, procurement professionals can further optimize the procurement process. The ultimate goal is to make the process from order to payment more efficient, accurate and effective.

Proactive procurement strategy

Although the use of AI at Croonwolter&dros is currently still limited, the technology does offer great potential for the future. By applying more complex AI algorithms and self-learning systems, procurement professionals can gain more and better insight into the available data. This will allow them to make faster and better decisions, for example by recognizing patterns and predicting future developments.

This can lead to a more proactive procurement strategy and better negotiations with suppliers. It is important to continue investing in the development and optimization of AI applications to make the procurement process more efficient and effective.

As a result, procurement professionals will be able to add even more value to the organization in the future. They will be better able to seize opportunities and make the right decisions based on available data. This will ultimately lead to better results and an improved competitive position.

Predictive maintenance

Predictive maintenance is a good example of how the use of AI can bring big changes to the procurement role. By using a larger data set, it is possible to perform risk analysis that was not possible before. This allows for proactive maintenance planning, saving unplanned repairs and associated costs.

Analyzing data from connected assets makes it possible to calculate the probability of failure when maintenance is delayed. Analyzing multiple failures allows AI to determine which failure should be fixed first. This type of analysis and prediction is not possible without the use of AI.

The use of AI allows procurement professionals to make more proactive and effective decisions. By recognizing patterns in data and predicting future developments, procurement professionals can conduct better negotiations with suppliers. It is important to invest in knowledge and skills to take full advantage of the opportunities offered by AI to dramatically change the procurement role.

Lonked perspective for Procurement and Finance

The use of AI and machine learning is having a major impact on procurement roles and processes, offering many opportunities for a more efficient and effective procurement process. By automating repetitive and manual tasks, procurement professionals can spend more time on strategic tasks and improve collaboration with suppliers. In addition, AI provides the opportunity for new insights and better negotiations.

It is important to realize that the use of AI does not mean that it completely takes over the work of humans. It involves humans and machines together, with humans still playing an important role in directing and monitoring the process.

Companies can prepare for these changes by including employees in a timely manner and showing them what the impact of new technology can mean for them. In doing so, it is important to give employees room to fill their new roles themselves and appeal to their human inventiveness.

Ultimately, AI and machine learning offer a beckoning prospect for Procurement and Finance. By leveraging these technologies, companies can be more efficient than with outsourcing to low-wage countries. However, it is important to ensure ethics and avoidance of bias.

Procurement professionals should be aware of the opportunities and challenges of AI so that they can take full advantage of it and evolve traditional procurement roles into more tactical ones. It is important to leverage the opportunities of these technologies to make the procurement process more efficient and effective, but so that it works to everyone's advantage. -