AI-powered procurement can optimise the way corporate buyers source services
Readers are well aware of the role that automation plays in driving efficiency savings in supply chain and procurement processes for goods. However, when it comes to buying business services, few enterprises have adopted this kind of automation to improve their procurement.
Research suggests that buyers of business services may invest up to 20% of their time engaged in the manual process of sourcing, vetting, shortlisting and selecting new service providers due to the bespoke requirements required for this kind of procurement. The current evolution of AI and machine learning technology changes this picture, empowering procurement to accelerate the purchasing of services.
It’s no surprise to see the influence of AI in services procurement, as AI and automation are seeping into virtually all sectors. Over recent years, we’ve seen plenty of headlines around machine-learning improving manufacturing processes and AI being used to help make driverless cars a reality, for example.
For procurement, the B2B Marketplace Maistro has used these technologies to create a cloud-based sourcing and delivery platform to benefit procurement professionals who are responsible for sourcing, vetting and procuring services. The Marketplace uses AI-driven technologies to rapidly source vetted service providers and dramatically reduce the time procurement has historically had to invest in inefficient sourcing and shortlisting processes.
Adapting to new business needs
Like the procurement of goods, some of the business services that an enterprise needs are easily commoditised, like printing for example. However, more specialised business requirements may need sophisticated, multi-faceted services, such as the development of marketing plans for specific purposes, event planning and logistics or bespoke software development. Sourcing projects like these tends to be much more complex and fluid than those focused on the procurement of goods or commoditised services. Contrary to conventional belief, an AI-powered platform can analyse a complex corporate brief, identify key requirements and deliverables, then, in accordance with a corporate buyer’s criteria, the automated platform can shortlist providers within the marketplace that are best equipped to deliver the required services.
This automated selection process can save the corporate buyer a huge amount of time that might otherwise be spent sifting manually through dozens of responses to a request for proposal (RFP). It is progressive innovation like this approach to services procurement that is likely to usher procurement into a new era of best practice and modern working solutions.
Harnessing the AI power
AI-driven sourcing platforms can also bring greater transparency to the question of negotiating the right price for a project by anticipating the market rate for services. This kind of predictive analytics might then suggest a budget figure to the buyer for a proposed project brief, for example. The proposed budget would have been informed by machine learning technology which has analysed previous projects with similar specifications. This transparency helps to set reasonable expectations on both buyer and seller sides, thus neutralising what can be a major source of conflict.
Harnessing the potential of AI-powered processes allows for an efficient channel to market, reducing the timeframes to secure new work. They no longer need to endure what may feel like interminable RFP processes that curtail their own capacity planning and productivity. By cutting significant time and cost out of the services procurement process, AI-powered sourcing solutions are already enabling a growing number of businesses to accelerate corporate buying.
Artificial intelligence and machine learning are transforming every aspect of business operations. The field of sourcing and procurement is not an exception. We’re just at the cusp of seeing the impact AI will have on procurement - and services procurement, specifically. However, this is not to paint some dystopian, terminator-like future in which the machines are taking over. AI and automation work best when coupled with human involvement. An exciting journey awaits as businesses worldwide shift to a new way of working through a hybrid of commercial marketplaces and delivery platforms, matching technological innovation with human interaction. We’re thrilled to be a part of it.
Mark O’Shea, Chief Technology Officer at Maistro