Three months ago, I was in Singapore, sitting across from our head of engineering. He was frustrated.
“I just need a laptop for the new hire. Why do I need to fill out a form, submit three approvals, and chase procurement for a quote?”
That moment captured the problem perfectly: procurement had become a bottleneck, not a business enabler.
And it got me thinking—if we don’t radically change how we operate, we risk irrelevance. Not in 10 years. In five. Maybe less.
So I did what any data-minded CPO would do: I pulled out the Gartner Hype Cycle for Procurement and Sourcing Solutions 2024. And the picture was clear:
We are standing on the edge of a procurement AI revolution.
Hype or Hope? Where We Really Are
Let’s not sugarcoat it. Despite millions invested in Source-to-Pay (S2P) platforms, many procurement teams are stuck in:
- Intake chaos – Too many business users avoid the system altogether
- Tail spend paralysis – 20-30% of our spend is unmanaged, often off-contract
- Manual sourcing – High-effort, low-value RFPs drain team energy
- Data spaghetti – Supplier data lives in siloed systems, updated inconsistently
And this is happening while the world around us becomes more volatile:
Geopolitical shifts, trade uncertainty, climate risks, supply chain fragility, and inflationary pressure.
This mismatch between external complexity and internal inefficiency is our wake-up call.
What’s Different This Time? AI That Actually Works
Unlike previous hype cycles, this time the technology is ready. But more importantly, business users are ready.
1. GenAI-Powered Intake: From Friction to Flow
Instead of forcing users into procurement’s world, intake systems powered by GenAI let users describe what they need in their language. Behind the scenes, AI classifies, validates, routes, and even initiates the transaction.
It’s like giving everyone a procurement assistant. And it’s not just about usability—it’s about expanding influence and unlocking invisible demand.
2. Agentic AI for Tail Spend: Procurement’s Night Shift
Tail spend is where good intentions go to die. But with autonomous negotiation agents, AI can handle supplier outreach, pricing negotiation, and decision-making 24/7, across time zones, without human fatigue.
We’ve piloted this for IT accessories and facility services. Early results?
- 22% faster cycle times
- 9% incremental savings
- Zero burnout
Gartner may place this in the Innovation Trigger zone—but for us, it’s delivering real outcomes today.
Download Whitepaper: Beyond GenAI: The Dawn of Agentic AI in Procurement
AI Roadmap for Procurement Leaders: My 5-Year Plan (And What You Can Steal From It)
Year 1–2: Build the Foundation
- Implement GenAI-powered intake in 2-3 high-volume categories (e.g., IT, Marketing)
- Pilot Agentic AI for tail spend (~20% of transactions)
- Launch a Procurement AI Literacy Program for my team
Year 3–4: Scale the Wins
- Expand GenAI intake to 80% of procurement requests
- Use predictive analytics for demand sensing and risk
- Introduce advanced contract analytics in strategic categories
Year 5: Move to Autonomy
- Fully autonomous buying in routine, rules-based categories
- Implement Procurement Orchestration Platforms
- Establish procurement as a real-time, AI-driven command center
The Geopolitical Imperative: React in Real Time
AI isn’t just about cost savings anymore. It’s about resilience.
- A border closes? Reroute suppliers in real-time.
- A new ESG regulation is passed? Instantly assess exposure.
- A new tariff hits? Let AI run alternate cost models and recommend pivots.
Manual procurement processes can’t keep up with this complexity. AI can.
Download eBook: A CPO’s Guide to Intelligent Intake & Orchestration Management in 2025
Change Management Isn’t Optional. It’s the Main Event.
The biggest barrier? Not tech. It’s trust.
Here’s what worked for us:
- Show, don’t tell: A 2-minute demo of GenAI intake beat 20 slides.
- Free up, don’t replace: We told our teams AI will take the grunt work, not the strategic sourcing.
- Reward AI usage: We built KPIs around usage, efficiency gains, and stakeholder satisfaction.
And it worked. Adoption climbed. Resistance fell. People saw the value.
CPO to CPO: What You Should Do Now
If you read only one section—read this.
Start with GenAI Intake.
Why? It’s the fastest way to increase procurement’s visibility and improve business alignment.
Pilot Agentic AI in Tail Spend.
Even a 10-category trial will build your internal muscle and unlock hidden value.
Clean Your Data.
AI is only as smart as the data you feed it. Invest here. It’s unsexy, but essential.
Upskill Your Team.
Create a center of excellence. Make AI education mandatory. You’re not just building tools, you’re building capability.
Balance Risk with ROI.
Don’t fall for shiny tech. Use the Three Horizons Model:
- Horizon 1: Proven – CLM, Supplier Risk, S2P optimization
- Horizon 2: Scaling – Intake, Category Management, Predictive Analytics
- Horizon 3: Emerging – Agentic AI, Procurement Orchestration
Listen to Podcast: The New CPO Mandate: Lead with Autonomy, Not Templates
The AI Window Is Open—But It Won’t Stay That Way
In 2026, there will be CPOs explaining how they led their organizations into the AI age.
In 2029, others will explain why they couldn’t move fast enough.
As for me? I’ve made my choice.
We’re not betting on AI because it’s trendy.
We’re betting on it because strategic procurement needs it to survive.
Are you making the same bet?
Let’s exchange notes. I’d love to hear what’s working—and what’s not—in your AI-powered procurement journey.
Related Reads:
- AI in Procurement: The Ultimate Guide to the New OS
- AI Agents in Procurement: A Comprehensive Guide
- The Power of Orchestration for Cost Efficiency and Strategic Success: A Game Changer
- Unlock Hidden Procurement Insights: Mastering Data Orchestration Before Your Competitors Do
- Navigating the Complexities of Procurement Orchestration: Tackling Tech, Process, and Stakeholder Hurdles
- Merlin Intake Resource Center
- Whitepaper: The Integration Imperative: Transforming Procurement Efficiency with Built-In Intake Management
- Streamlining Sourcing: The Power of Autonomous Negotiation
- From Data to Decisions: How to Leverage AI for Smarter Sourcing
- 5 Key Benefits of Automating Tail Spend Management
- Why Mid-size Organizations Should Invest in Procurement Automation Now
- The Future of Sourcing: Autonomous Solutions for Procurement
- Whitepaper: Deep Value Procurement AI: Unlock the Hidden Potential in Your Procurement
