TECHNOLOGY
“ The future of ML and AI in procurement will most likely be in facilitating the integration of procurement activity and strategy with the commercial end of businesses that are materials market dependent ”
ROLAND SIMON FORMER SENIOR VICE PRESIDENT AND PROCUREMENT SUBJECT MATTER EXPERT ELECTRIFAI
internally with the rest of the business . Ideally , as a function , effectiveness is improved dramatically as a business thought partner – a common aspiration these days for procurement leaders seeking performance at a world-class level . The challenge lies in translating market trends and data together with spend analytics through to their impacts on the costs of finished goods at a granular level . Therefore , understanding real competitive position , starting at the procurement end of the business through to the sales side of the business , is currently nearly impossible in real-time for many industries . The solution is ML and AI algorithms that process significantly higher volumes of data than humanly possible to connect dots from the front of the operation to the back .
“ Software solutions in the future will be able to connect third-party material indices and economic trends and telegraph that data through company costing processes to enable real-time margin management for industries that thus far have had to react to volatile market changes . Predicting the future based on history has never been sound science . However , for any industry segment , key leading indicators can be assembled , and
with comprehensive analysis , it is possible to predict likely directions in trends . The future of ML and AI in procurement will most likely be in facilitating the integration of procurement activity and strategy with the commercial end of businesses that are materials market dependent .”
Hugh Simpson on Big Data and IoT “ Implementing a Big Data capability in supply-chain organisations will enable them to unlock the true value of data , improve customer service and optimise operations .
“ Smart supplier selection with Big Data and AI recommendations increase procurement staff utilisation by 20-30 % and improve internal customer service .”
Internet of Things “ When combined with Big Data and AI , IoT is a great enabler for predictive procurement
96 April 2021