Organizations are looking to CPOs to take on broader and deeper strategic initiatives to create a future proof supply chain. What Covid-19 did to firms globally is no secret. So, apart from cost savings, there are several other goals like innovation, digital transformation, sustainability that have become part of CPO’s agenda. Hence, the biggest question is how to cater to these varied objectives that are there on CPO’s plate?
To answer it in one word is – Digitalization! In other words, the electronic Procurement system is the paradigm shift in the Procurement function. In bringing about this disruption, AI plays an indispensable role.
In a Survey reported by Deloitte, 51% of the respondents indicated they are now using advanced analytics in Procurement. So using AI, analytics, and automation, organizations are able to evaluate opportunities through data-driven insights, allowing them to understand the macro factors even more clearly. However, the question arises, does this pose a threat to the future of procurement jobs?
To answer this, I would like to quote Len Prokopets, Managing Director of KPMG’s procurement practice notes, most AI procurement solutions are “not reducing headcount, but driving improved results.”
The journey of digital transformation of Procurement can be broadly divided into 3 stages:
The magic of AI lies in its ability to analyze data, predict and draw pivotal insights in terms of decision making. The benefits of embracing digital procurement for a firm are manifold. It enables supplier centricity and greater visibility, sustainable sourcing, innovative category management techniques and all this culminates to make it a more customer-centric organization. However, technology’s impact on a business is more a function of people’s willingness to adapt, thus organizational culture plays a crucial role is the process of transition of procurement function first to e-procurement and then to cognitive procurement.
In spite of the challenges that lay in the path of this metamorphosis, it is of utmost importance that an organization devise ways to overcome them. In the recent 2021 CPO Survey, conducted by Deloitte, it can be noted that there has been a drastic shift in procurement priorities. The need for Digital Transformation has increased by 20% as compared to 2019.
In addition to this, the survey also states that the adoption of next-gen technologies is a strategic lever to make procurement agile since front runners are 18x more likely to have fully deployed cognitive capabilities.
Zycus’ AI-based Merlin for eProcurement can free you from the tactical buying process, is capable of flipping a requisition to PO using just a single click. With its out of the box intelligence, it is able to make cost management, compliance, checks, and controls simple and easy to use.
With such easy to use digital procurement tool, your team can now focus on strategic initiatives, new product development, and nurture better third party relationships. Check out this less than 2 mins video to understand more about the features and benefits of Merlin AI Suite for eProcurement.