The Hackett Group: Integrating AI Into Procurement Practices

New research introduced by The Hackett Group explores how artificial intelligence is reshaping procurement processes across organisations.

The research, titled AI World Class Procurement Benchmarks, highlights how organisations can maximise improvements across supplier performance, business value, savings generation and procurement return on investment (ROI).

Rather than simply automating tasks, the report argues organisations achieve the greatest value by redesigning end-to-end procurement processes with AI at their core.

The research also examines how AI adoption will transform procurement, enabling teams to focus more on strategic decision-making than transactional activities.

AI adoption within procurement

According to The Hackett Group, AI adoption is the integration of artificial intelligence into business operations to drive efficiency, innovation and competitive advantage.

The report suggests AI adoption will be driven by business value rather than technology deployment alone.

As procurement leaders face pressure to reduce costs, improve supplier performance and manage risk with leaner teams, Chief Procurement Officers are encouraged to focus AI investments on accelerating savings, strengthening compliance and minimising enterprise risk.

A separate 2025 study by The Hackett Group found that 64% of procurement executives expect generative AI to fundamentally transform their teams' operations within the next five years.

Tim Yoo, Principal and Procurement Transformation Practice Leader at The Hackett Group, says: "Most organisations are still trying to justify AI investments one use case at a time.

"Our research shows the greatest returns come when organisations redesign procurement processes with AI as a key enabler, allowing better decisions to build value throughout the end-to-end process."

Purchase to pay practices

The research also covers sourcing, purchasing, supplier management, supplier performance and purchase-to-pay.

According to the report, AI creates value by optimising sourcing decisions, enhancing supplier intelligence and enabling more autonomous transaction processing.

These capabilities help organisations improve compliance, savings and procurement ROI while reducing administrative workloads.

Integrating AI allows companies to achieve up to 3X greater savings impact and procurement ROI up to 3.7X higher. Organisations can also reduce purchase-to-pay process costs by up to 80% and decrease staffing demands by nearly 81%.

The report says these efficiencies allow procurement teams to focus more on sourcing optimisation, supplier strategy and commercial decision-making.

Research also found autonomous transactions accelerate invoice processing by 74% while reducing invoice errors by 76%. Guided buying and catalogue adoption increased by 110%, contributing to a 69% reduction in maverick spend. Competitive bidding metrics increased by 97%, while supplier concentration rose by 42%.

Jeff Gilkerson, Principal at The Hackett Group, adds: "Procurement creates the greatest value before an order is placed.

"AI gives procurement teams the capacity to spend less time administering transactions and more time making better supplier and commercial decisions that strengthen enterprise performance."

The latest benchmark research suggests AI is becoming a key enabler of those priorities by helping procurement teams reduce costs, improve supplier performance and take on a more strategic role across the enterprise.