Procurement functions within companies have traditionally focused on cost-cutting and risk management, but the demands of today’s global supply chains require a far more strategic role. At a recent virtual event presented by Amazon Business, titled “Resilient Growth: Navigating Procurement Complexity,” industry leaders highlighted how procurement is evolving into a data-driven, AI-enabled partner that plays an essential role in navigating supply chain challenges.
Speakers including Sandhya Dhir of Amazon Business, Paula Glickenhaus of Bristol Myers Squibb, and Sheila Gundersen of SMBC Americas discussed how artificial intelligence (AI) is transforming procurement workflows and enabling departments to deliver faster, more proactive solutions. As Glickenhaus noted, “AI is here to stay,” underscoring the rapid emergence of AI tools deployed to differentiate how procurement teams serve internal stakeholders, provide real-time analytics, and enhance decision-making.
Dhir emphasised AI’s potential to automate and optimise inefficient manual workflows, pointing out that “AI can auto-adapt to, or learn, each client’s data and assign tasks within a workflow based on capacity or priority.” She also advised that integrating AI solutions requires patience during the initial phase as organisations work out the right prompts and mechanisms. This nuanced approach reflects a broader trend across industries where AI-driven automation is expected to significantly increase procurement productivity, with Gartner forecasting a 21.7% boost over the next 12 to 18 months as half of organisations adopt AI-enabled contract management tools by 2027.
Procurement’s traditional reactive stance is shifting toward proactive supply chain risk management and strategic planning. Gundersen described this pivot as an evolution towards leveraging AI and ongoing monitoring tools to anticipate disruptions rather than merely respond to them. The availability and analysis of vast data sets are crucial to this advance, with Glickenhaus highlighting how quicker data processing now allows firms to respond to events like earthquakes and tsunamis more rapidly, safeguarding supply continuity.
This proactive orientation aligns with broader industry efforts to harness AI for comprehensive supply chain visibility, a challenge intensified by the increasing complexity and fragility of global logistics networks. Since 2000, the value of internationally traded intermediate goods has tripled, amplifying the need for real-time tracking across borders and transport modes. While conventional technologies such as GPS and RFID provide partial insights, AI-driven ‘control tower’ platforms promise enhanced predictive capabilities and operational optimisation. However, full end-to-end visibility remains elusive due to data-sharing limitations, especially among smaller suppliers who may lack resources or incentives.
Beyond operational efficiency and risk mitigation, AI is becoming instrumental in addressing pressing ethical and regulatory concerns. Reuters reports that AI is increasingly used to monitor human rights risks in multi-tiered supply chains, particularly in industries vulnerable to abuses such as mining and electronics. Leading firms are deploying AI to process large volumes of disparate data, identifying potential violations faster than conventional supplier surveys. Yet, experts caution that AI cannot replace the nuanced human engagement required for effective due diligence, though it remains a powerful tool for strategic risk prioritisation and faster, more targeted responses.
Sustainability reporting similarly benefits from AI’s data analysis capabilities amid expanding regulatory demands. Organisations are investing in AI-driven ESG platforms to enhance materiality assessments and sustainability risk management, despite challenges around implementation costs and technological barriers. This trend reflects a growing recognition that robust data governance and automated analytics are essential for compliance and corporate transparency.
Industry analysts at Gartner confirm the accelerating adoption of generative AI (GenAI) in procurement, noting that it has reached a “Peak of Inflated Expectations” but is poised to achieve substantial productivity gains rapidly. The swift movement toward practical applications such as contract lifecycle management underscores AI’s transformative potential across procurement and supply chain functions.
Overall, procurement is becoming a strategic nexus where data utilisation, AI innovation, and cross-functional collaboration converge to better navigate complexity, enhance resilience, and create value. As Sandhya Dhir summarised at the Amazon Business event, this interconnection of procurement and data-driven solutions represents an exciting future for the profession—one where procurement not only manages costs and risks but also proactively drives growth and innovation within organisations.
Source: Noah Wire Services
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