Prepare for the Impact of AI on Procurement

Basic machine learning technology is already used by some procurement applications in areas such as spend analytics and contract analytics. This is mostly limited to automating the processes of collecting, cleaning, classifying and analyzing expenditure data in an organization -- to identify savings or paths to greater efficiency. Today, procurement technology vendors are creating cognitive procurement advisors (CPAs) and virtual personal assistants (VPAs) that use natural-language processing (NLP) and natural-language generation to further increase automation and efficiency. "A procurement VPA can improve the end-user experience of traditional procurement tools and increase spend under management by guiding people to the correct purchasing tool," said Magnus Bergfors, research director at Gartner. "A CPA can provide summaries, recommendations and advice in everything from supplier assessments and performance management, to risk management and compliance."