How KPMG Transforms Public Sector Procurement Management

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KPMG has helped a government's procurement team (Credit: Image by rawpixel.com on Freepik)
KPMG has provided a government's procurement team with a deeper understanding of the performance and competitiveness of their suppliers

A regional government in Europe is setting a new standard for transparency and efficiency in procurement, thanks to the help of KPMG.

As many governments will attest, meeting the needs of public administration and meeting the needs of citizens and businesses are essential for ensuring the procurement process is efficient, fair and transparent.

For one procurement department of a government in a European region, which relied on manual processes and unstructured data for decision-making, the volume involved caused significant complexities and inefficiencies in managing the procurement cycle. Plus, the lack of a unified information system made it difficult to analyse, compare and interpret procurement data effectively.

The team found that it needed an approach that would systematically collect, consolidate and standardise their procurement needs, optimise tender management and support their planning decisions.

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The opportunity

KPMG in Italy took on the task and started by using a methodical approach to understand the procurement department's existing knowledge base, including data sources, storage practices and information management systems.

Generative AI (Gen AI) was then used to organise the department's information in a more structured way and implemented based on two proofs of concept using Microsoft Azure Search and OpenAI services to streamline the department's information mining.

The outcome

The first proof of concept focused on a prototype Medical Devices Catalogue that analysed tender documents by linking them with additional information in the execution and consumption phase.

This led to a more streamlined organisation of product knowledge that could be identified and retrieved using a single system.

KPMG (Credit: Getty)

The second proof of concept was the development of a supplier categorisation tool where insights into past interactions provided the procurement team with a deeper understanding of the performance and competitiveness of their suppliers.

The client's procurement professionals now have greater support in the procurement cycle and the tender management process has been optimised with improved access and retrieval of critical information.

With a more streamlined process and unified database, the procurement team has increased their ability to analyse, compare and interpret data locally and centrally. The single information system is providing them with the necessary business intelligence for crucial planning.

AI is not just hype

In a report on how AI is transforming financial reporting globally with near-universal adoption expected in the next three years, Larry Bradley, Global Head of Audit at KPMG International, said: "Our study confirms it – AI is not just hype.

"It is already having a profound effect on how companies operate, including their systems, processes, controls and governance over financial reporting and this is set to dramatically accelerate in the next few years.

Larry Bradley, Global Head of Audit at KPMG International

"We are leaving the digital age and entering the AI age. As auditors, we are committed to utilising the power of AI in everything we do, not just as a tool, but as a fundamental part of our approach to auditing.

"Our goal is to ensure that AI is used in a way that is trustworthy, human-centric and values-based. This is underpinned by KPMG's Trusted AI Approach."


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