Increased connectivity will change procurement processes, but also carry an increase amount of risk, a report has said.
Opening up catalogues, using of artificial intelligence, and integrating procurement systems into broader planning and processes within a business were outlined as key areas where technology would change the profession.
The findings are a result of a series of in depth interviews with procurement professionals by e-procurement firm Wax Digital, released in a two-part report, Future Technology 2020.
The report’s key themes are all around the improvements to communication, data and connectivity, said Daniel Ball, business development director at Wax Digital.
“They all boil down to how we can leverage information, applications, capabilities beyond our environment. If you look at catalogues, the real focus there is not how we can better manage our own catalogues… it’s about how we leverage all of the product information that is out there on masses of websites,” he said.
“As any area of innovation should, it excites both interest and apprehension,” he added.
In the future, procurement systems will be able to tell if a catalogued item is not competitively price, and run an automated “spot buying event” to immediately gather better quotes elsewhere, the report predicts.
Just like consumers have access to price comparison sites, e-procurement platforms will be able to scrape prices over the web and even run completely automated tendering processes with supplier’s own “intelligent e-commerce” platforms, Wax Digital also predicted.
However, technology’s ability to open up the procurement process also caused the greatest concern among buyers, said Ball. By automating processes, using AI or allowing people within the business to browse third party catalogues you open your business up to risk.
“There’s a tension there between opening up the world of procurement beyond the corporate boundaries, and actually making sure that that doesn’t impact on the controls that you want to put in place or expose the business to risk, whether that be risk of cyber crime, hacking, or whether it just be risk of people buying off-contract or non-compliantly,” he said.
A lot of the technology predicted in the report is already on the way, said Ball. It’s now possible to search Amazon as well as local catalogues on the same system, and neural networks – a form of AI – are already being developed to identifying suppliers based on geographical location, said Ball.
“We’re well down the way for a lot of this already in technology capabilities terms. Whether we’re ready for it from a procurement mind-set is a different matter in some respect,” he said.
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