Although AI tools promise to be the solution to boosting productivity, new research from Ivalua claims more than half (53%) of procurement and supplier management processes haven’t even been digitized yet.
This doesn’t come as a shock, though, because 50% of procurement leaders already think that the digitalization rate is too slow, and almost half reckon the existing systems aren’t agile enough.
The cost of maintaining current manual and paper-based systems could be costing workers around one-fifth of their time, representing huge potential for revenue growth with a few tweaks to keep the industry up-to-date.
Procurement and supplier management remain mostly paper-based
Digitally available information speeds up company operations by enabling quicker decision-making and also promises to prevent rising costs.
Smart procurement expert at Ivalua, Alex Saric, said: “Given inflation remains high and the economic outlook uncertain, it’s never been more important to digitize procurement processes, and free up teams to tackle these challenges.”
Using dated systems also presents talent acquisition and retention troubles, but change could be on the way. More than four in five (85%) organizations have implemented or plan to implement data analytics, and a further two-thirds (63%) have or will use AI or ML technology.
Businesses thinking that they can just add AI tools without laying the foundations first may be disappointed with the results, though. Saric said: “Poor-quality data will limit the insights produced by AI.”
The study outlines the next steps for businesses still looking to modernize their procurement departments, which begin with taking a more cloud-based approach. Saric says it’s about walking before running, and it’s clear that many procurement departments may be more than just one step behind others.
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With several years’ experience freelancing in tech and automotive circles, Craig’s specific interests lie in technology that is designed to better our lives, including AI and ML, productivity aids, and smart fitness. He is also passionate about cars and the decarbonisation of personal transportation. As an avid bargain-hunter, you can be sure that any deal Craig finds is top value!