Six steps to approach this game-changing opportunity for the modern procurement professional

Generative artificial intelligence (AI) is revolutionizing the nature of work across almost every industry around the globe. We see it in creative work, where large language and image AI models generate automated content. In manufacturing, generative AI augments human-based product design efforts, optimizing key processes, and improving quality control. For example, it’s changing how healthcare is delivered, improving patient outcomes through better diagnosis and information sharing.

To better understand AI’s role in transforming the procurement landscape, ProcureAbility and our AI partner, dSilo, present our co-authored Insights series, “The Future of AI in Procurement.” In the third installment of this series, ‘Transforming theory into practice,’ we explored how game-changing AI can connect strategic and tactical procurement processes while reducing manual activities significantly. We delved into the transformational potential of AI in procurement, and the unique traits making it a prime use case for AI adoption in our industry, to an extent that previously hasn’t been possible.

As procurement professionals, we need to look forward to generative AI technology impacting our domain. Clearly much of the concern around generative AI is that it will eliminate jobs. The reality is that it’s going to augment work and change the nature of jobs – it has been forecasted that by 2030 there will be 12 million work transitions from low-wage jobs to high-wage jobs as automation, aided by generative AI, displaces workers.¹

This step change represents a once-in-a-career opportunity for procurement professionals to guide their personal success by adopting generative AI, building new skills, and redefining how they contribute value to their organization. Many of the activities that take so much time today – such as data gathering, analysis, reporting, and rote transactional activities – will be managed by emerging technology. This will free up time for higher-value work that will provide new value to stakeholders. Yes, this will reduce costs, but it will also enhance revenue by streamlining processes and enabling better outcomes from the supply base.

The question then becomes: How should you specifically and strategically approach this transition as a procurement professional? In this blog, we will outline the six steps needed to approach this game-changing opportunity for the modern procurement professional.

As the saying goes, you can be part of the solution or part of the problem. For you to be part of the solution, you’ll need to be an innovator or early adopter of the technology. That means being prepared to take some considered risks by testing the capabilities and stretching the use cases with either your technology providers or your IT colleagues if you’re developing those capabilities in-house.

At dSilo, they are finding that their progressive clients are producing new use cases to address longstanding challenges. Take the example of an airline partner of ours that wants to use our platform to improve the way it manages over 40,000 repair and overhaul tickets every year using a highly manual process. Another client in the financial services space is looking to use it to deepen and accelerate their acquisition due diligence.

These applications are just scratching the surface of what generative AI can do and will do in the future. Now is the time to dream big.

There is a huge amount of knowledge sharing on generative AI already happening. Identify your niche so you can be intentional and efficient with your focus based on your experience, aptitude, and existing opportunities. Participate in webinars, conferences, and analyst presentations to learn about what others are doing and what emerging providers are enabling. Take classes from your company’s training providers or from other sources. If you’re a leader in this respect, make these classes available and encourage your teams to invest their time. Generative AI skills are no longer optional, but now required, to succeed in today’s competitive landscape.

If necessary, work with the training and development team to update the function’s competency matrix to reflect these new skills by role. And make sure that you also understand the risks and limitations of what’s available today – specifically, what’s needed to ensure that your data is secure, that you’re complying with your internal requirements, and that you have appropriate rights to the information you’re using. At ProcureAbility, we realized that if our teams need to embrace generative AI, we need to enable them to take the dive and we have incorporated these elements into our core training programs.

Include automation goals as part of your personal objectives. If you’re a business leader, ensure there’s alignment up and down your organization on these objectives. If you’re in a procurement technology role, you will have primary responsibility for adoption of automation. Therefore, generative AI should be embedded in your plans so it’s part of the normal course of business. Look to create metrics that specifically address these objectives to demonstrate success.

Many of today’s leading organizations have committed to reskilling their workforce on generative AI. So, you might already have a robust library of training materials available to you. Leverage them to the fullest to accelerate your education and implementation of generative AI-related skills. You should also advocate for additional training courses to be added by your firm if you don’t find suitable ones for procurement—or to be able to enroll in external classes.

As a procurement professional, recognize that this is a journey that will take place over many years as technology evolves, and we become more comfortable with its capabilities and limitations. Using a SMART (specific, measurable, attainable, relevant, time-bound) framework is an effective approach to setting objectives around implementing generative AI in your procurement organization.

Despite the buzz in the market around generative AI, it’s not fundamentally changing the procurement process – at least not yet. Innovators are dipping their toes in the water and enjoying the initial benefits. In so doing, they’re putting some early runs on the board and supporting future efforts, but they’re also hitting some barriers where the tech isn’t delivering as promised due to factors such as insufficient training and processes that are more complex than the large language models can handle.

Of course, technology will improve, and these barriers will eventually be overcome. Whether you’re ready or not depends on the steps you start taking today.

Generative AI is still a nascent space, and the landscape is continuously evolving. The tools and technologies as well as large language models (LLMs) and foundational models (FMs) are continuously evolving.  As such, it is imperative that you continue to learn about development in this space, even if it sometimes feels overwhelming. Focusing on finding your focus can help you manage the process of learning, adopting, and leading within your procurement function and industry with generative AI.

In this Insights series, we delve into the transformative role of generative AI in elevating procurement capabilities, with a focus on how ProcureAbility and dSilo are currently implementing these practices to take their clients’ use of this game-changing technology to the next level. In the next and final installment of ProcureAbility’s “Future of AI in Procurement” Insights series, we will share thoughts on where we see generative AI taking us in the long term and the implications for the procurement function.