How will machine learning affect public procurement?

Steve Malone
12 February 2019

Over the next two years machine learning will change the public sector procurement workforce significantly.

Don’t fear, algorithms won’t be replacing purchasing teams in councils, housing associations and hospitals. But computer programmes that think and learn like humans are playing an increasingly important part in the buying process and they will influence the skills and roles that are most sought after in the next few years.

Machine learning is well suited to procurement because it spots patterns in the large volumes of data generated through purchasing and then forecasts future trends.

This form of AI is also relevant to private sector procurement. But it is in the cash-strapped public sector, where supply management professionals are tasked with identifying critical cost-reductions, that the automation and granular insight of machine learning is particularly appealing.

If you are a buyer in the health sector, a university or social housing provider, then here are some pointers to help you prepare for workforce change and to ensure you remain attractive to employers:

1. Show your strategic strengths: Many people fear that AI will replace great swathes of procurement professionals. This isn’t true: it will support, not supplant. Machine learning will take over repetitive tasks like manually classifying purchased products, freeing up staff so they can focus on more nuanced, complex activity like negotiating with suppliers or investigating maverick spend. Show the relevance of your skills by demonstrating your ability around higher-level supply chain management. Emotional intelligence, excellent judgement and the ability to build strong relationships will be more important than ever.

2. Broaden your skills: Machine learning doesn’t work unless it has accurate data and lots of it. The public sector has been slow to improve how it uses data and, going forward, procurement leaders will prioritise data quality above almost everything. New roles such as data scientists (who draw meaningful insights from statistics) and business intelligence developers (who build the software systems that enable this analysis) will become more commonplace in public sector buying teams. If you are involved in this type of work or keen to be, it might be worth training or gaining further experience, so you can step into a data role.

3. Improve your performance: Machine learning can help you become a better procurement practitioner. It can provide recommendations when you are making difficult decisions about the best products to buy. It can speed up your work by digesting thousands of lines of data and producing easy-to-digest figures, helping you make faster, more accurate judgements. Embrace AI to improve your own competence and stand out from the crowd.

4. Gain wider recognition: As other departments begin to see the valuable business intelligence that procurement can provide through AI, this is your time to shine. Shrug off the traditional pencil-pushing image of the buyer and demonstrate the unique know-how you can bring to the rest of the organisation. Being recognised by leaders from other departments can only be a good thing in terms of career progression.

Steve Malone is MD of Inprova Group

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