First and foremost, procurement functions have evolved astronomically. In the past, this function operated in silos with common knowledge and spend data report gathered in an emergency to compute unit cost improvement. However, now, procurement has migrated to a vast field of technology, enabling global teams to strategically drive their supplier relationships with a focus on the total cost of ownership. In addition to that, with state-of-the-art technologies parsing clouds of data, procurement has claimed itself an autonomous entity we’ve named cognitive procurement.
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Indeed, for organizations that have just started to automate their existing capabilities, it is a good start, but knowledge is there that cognitive procurement is not limited to functional automation alone. Besides that, cognitive procurement is a facelift for end-to-end workflows that harness the maximum potential of a co-working of humans and machines complementing each other.
It should be noted that within the premise of cognitive procurement, professionals are at the forefront to drive strategic relationships and innovate across the value chain. Cognitive procurement offers capabilities that fetch real-time insights into your market and competitors to help plan ahead of time. In addition to its capability of self-learning, cognitive procurement through demand-sensing combs through a massive volume of structured or unstructured data sets that generate enormous output. Here, category managers can fully exploit a high degree of segmentation of automated tail spend possible within cognitive procurement.
Further Reading: 5 Cognitive Technologies to Look Out For in the Future
in addition to the above, cognitive procurement is not a different science but the application of disruptive technologies (Artificial Intelligence, Machine Learning, RPA) in areas that are challenging to the functional fluidity of all procurement related operations. Along with that, cognitive procurement is not just a facelift for the traditional role of supply chain management; it also brings supply chain managers to new limelight of strategic advisors.
Cognitive Procurement can help-
- Achieve huge breakthrough volumes of structured and unstructured data
- Replace the need for purchase order systems
- Replace the need for supplier onboarding workflows
- Automatically forecast prices, create templates and assess/evaluate
- suppliers (Zagorin, 2017).
- Identify hidden risks through in-depth risk assessments
- Create an intelligent assistant to identify opportunities for procurement agility
Particularly, according to Bernard Maltaverne, intelligent procurement assistant in the context of natural disasters, generates weekly reports gathering from the global supply chain landscape, helping businesses avert unpleasant risks and loses thereof scaling one’s business to the top of the line brand value. In this, cognitive technology triggers automated messaging via open-source data regardless of its structure.
Last but not the least, “The Procurement assistant learns immediately about the event because it is connected to external sources of information (there are many providers of supply chain risk management technology that enable that) or to public sources of information (news outlets or social media, for example). Consequently, it will then:
- list all impacted suppliers and what the organization buys from them
- identify existing alternate sources
- prepare a report with prioritized recommendations for action” (Maltaverne 2017)
Impact of Cognitive Technologies in Procurement & Supply Chain
|Analytics & Reporting
Generate Report, Predictive Modelling & Analytics
Draft Industry Standard Cost Models
|RFx & Auction Support
Generate easy RFx
Receive decision data to support auction
|Supply Risk Management
Predict risk in advance
Come up with an efficient mitigation strategy
|Spot Buy Operational Procurement
Call off Method mapping
Assess transportation & plan logistics
Optimize logistic efficiency
|Supplier Performance & Master Data Management
Easy supplier performance evaluation
Find relevant suppliers for backup
Supplier data management
|Supply & Materials management
Planning for predictive production
Predictive MRO inventory management
|Help Desk & Support
Round-the-clock Virtual Support
Round-the-clock Support from SMEs
Following our above discussion, if you need more information, contact Zycus at firstname.lastname@example.org