Although fully autonomous procurement remains a long-term goal for many organisations, no industry is prepared at this point to fully automate its procurement processes. In the meantime, hybrid solutions blending human oversight, machine learning, and automated analysis have begun to deliver some of the efficiencies and reliability that autonomous procurement promises. This new vertical is referred to as Augmented Procurement.
To be clear, Augmented Procurement seeks to support human initiative and inform human decision-making, not to replace the central functions of procurement professionals. Most augmented procurement systems, like other machine learning applications, require careful training and precise calibration before they produce reliably actionable results. With sufficient oversight, augmented procurement can transform the way an organisation keeps its operations running.
Augmented procurement systems can, for example, be trained to receive and analyse pricing information, and to build predictive models of future pricing trends. This can pay immediate dividends in the form of reduced expenditures on each purchase order, whilst also helping procurement officials make data-driven strategic decisions about sourcing and long-term spending. Augmented procurement can also help organisations, facilitating retrospective spend analysis and producing scenario-based models that reflect various strategic pathways.
Just as importantly, augmented procurement can largely automate some of the least efficient aspects of the procurement process. When properly trained, an augmented system can manage supplier discovery, execute purchasing decisions, announce awards, and even some early phases of negotiation with shortlisted suppliers.
Augmented procurement can also help organisations, facilitating retrospective spend analysis and producing scenario-based models that reflect various strategic pathways.
It’s unsettling that automation will change your professional life, no matter what your line of work. Even when the introduction of automated processes is heavily mitigated by human input, this can be a cause of anxiety for established professionals. Augmented procurement, for all its strengths, is no different.
To put it bluntly, augmented procurement will replace some of the functions formerly performed by humans. That’s better news than it might seem at first: augmented procurement specialises in exactly the kinds of comparative bean-counting that can distract procurement experts from thinking more strategically and creatively about their organisations’ long-term strategic needs.
Augmented procurement can streamline once-burdensome processes. It can deliver insights and data in ways that let humans make full and immediate use of them. It can, in brief, free an organisation’s procurement department to make the minute judgment calls and broad strategic decisions that save money and keep operations running efficiently. On its own, information is effectively inert. Left to their own devices, automated processes can wreak havoc. Augmented procurement will make professionals more relevant than ever.
Augmented Procurement brings together the purchasing data from the different procurement systems and data sources on one platform. On this platform, various analytics and automation use cases can be executed, which relieve the purchasing department of work through automation and support it in decision-making through analyses and recommendations. Thus, procurement teams can focus on more value creating tasks, while increasing costs savings and mitigating risks at the same time.
The more data and data sources are connected to an Augmented Procurement Platform, the more powerful the platform becomes. An Augmented Procurement Platform lives on data, its quality, and its variety. More data means more analyses, more insights, more recommendations, more automation, which all creates new data and feeds back into the platform.