SAP: Strategic Procurement Leveraging AI for Improvements
With AI presenting enormous potential for organisations, SAP details the process known as the ‘triple crown’ of strategic procurement.
Focusing on how AI can drive a continuous cycle of improving risk, assurance, costs, efficiency and sustainability, the tripe crown strategy is a three-step approach that combines insights, planning and action to revolutionise procurement.
Understanding your business objectives
Sudy Bharadwaj, Global Vice President, Strategic Engagements and Cindy McKendry, Director Corporate Communications, Intelligent Spend and Business Network at SAP highlight the importance of truly understanding your business objectives.
“Before diving into any initiative, it’s crucial to understand your true business objectives. These might include cost reduction, improved sustainability, increased profitability, improved customer service, or a combination of factors,” they explain.
“The key is to identify and measure metrics that not only reflect these objectives but also help improve them.”
Technology such as SAP Spend Control Tower can drive these insights, offering a bird’s-eye view of your entire procurement landscape. AI can help to enrich supplier data, highlight spend patterns, understand and mitigate risk, highlight opportunities for supplier consolidation or diversification, track sustainability processes and improve payment terms.
“But here’s the thing: having all this data at your fingertips is just the beginning,” says Sudy and Cindy. “The real magic happens when you start to connect the dots and uncover insights that weren’t visible before.”
The power of real-time analytics
A powerful feature of SAP Spend Control Tower is the ability to provide real-time analytics.
“In today’s fast-paced business environment, waiting for monthly or quarterly reports just doesn’t cut it anymore,” notes Sudy and Cindy.
As such, organisations need to be able to react to changes in the market, shifts in supplier performance or emerging risks quickly. All of which is achievable with real-time analytics.
But it’s not only beneficial for reacting to problems, real-time analytics can present opportunities too, highlighting trends in the industry.
Humans and AI
Whilst AI and real-time analytics have enormous potential for the procurement function, it is important to note that these tools augment human intelligence, they are not to replace humans.
“The insights provided by SAP Spend Control Tower can be invaluable, but they still need to be interpreted and acted upon by skilled procurement professionals,” stresses Sudy and Cindy.
“This is where the art of procurement meets the science of data analysis.
“The solution might tell you that you have an opportunity to consolidate suppliers in a certain category, but it’s up to you to weigh that against other factors like supplier relationships, quality considerations, and long-term strategic goals.”
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