Whisper the word “automation” in any procurement environment and I guarantee you’ll get a few awkward responses. While technology has driven procurement into a new era and unlocked huge potential in how we do things, there’s still a lot of misconception, and mistrust, around the role of automation in the procurement process. I want to dispel these fears; automation isn’t a dirty word, and it’s not here to simply “take our jobs”.
Understanding the misconceptions and fears
Automation, on a very basic level, might imply that human beings are no longer the essential cog in the machine. This fear stems from a general lack of understanding about what can realistically be automated.
There is a misconception that automation will lead to a loss of control and increase dependency on technology. Many worry about the reliability of automated systems and the potential for errors. However, these fears can be mitigated through proper implementation and oversight. Automation should be viewed as a tool that complements human efforts, allowing professionals to focus on more complex and value-added tasks while routine, repetitive tasks are handled efficiently by technology.
The question should not be about what happens when 50% of tasks are automated but rather how the freed-up time can be used for more strategic activities. Reskilling and upskilling procurement professionals to take on more strategic roles is essential.
While both buyers and suppliers might recognise the potential of technology, there’s still a significant need for education on the technical feasibility of various use cases within the procure-to-pay process too. This is where the expertise of procure tech companies becomes crucial; they have a duty to help procurement departments understand how to derive maximum value from automation without disrupting existing processes.
How automation can benefit procurement
Automation brings several key benefits to procurement processes, particularly in handling low-impact, high-effort tasks. For instance, in a manufacturing company that routinely orders specific parts essential to their product, these orders can be easily automated. The process is clear and standardised, with minimal room for error, making it an ideal candidate for automation.
Automation can also significantly reduce maverick spend, where goods and services are procured outside the official procurement process, leading to missed savings opportunities. Centralising procurement requests and leveraging AI to bundle them effectively, means companies can achieve better cost optimisation and efficiency. This not only saves money but also ensures more accurate and timely procurement processes.
Another area where automation excels is in improving compliance with regulations and sustainability standards. While complex supply chain monitoring and adherence to various standards can be challenging for humans, AI can manage these tasks with greater precision, ensuring compliance and mitigating risks more effectively.
How to work with automation
If you’ve read this far and you’re still worried about automation taking over your role in procurement, then you need to shift your mindset. Without getting too philosophical about the implications of this technology, there is a real opportunity for you to be liberated in your role. There is the opportunity to be more strategic. To engage in more impactful – and fulfilling – work.
If you are an organisation, I must also emphasise the need to be mindful of the pressure you place on employees. The results may not always be instant. While automation can unlock significant efficiencies, expecting immediate and drastic increases in productivity is unrealistic. Employees need time to adapt to new tools and workflows. Best practices for implementing automation include providing adequate training and support, creating a culture of continuous learning, and setting realistic expectations for performance improvements.
As with any new technology, there will always be an element of distrust when it comes to implementing it into decades-old workflows. However, I believe there is an incredible opportunity to unlock the strategic value of procurement professionals, as well as the direct benefits of driving efficiency, saving costs, and creating an industry that always stays on the right side of regulation and compliance. The future of procurement, if we fully embrace what automation can offer us, is not only more efficient, but also more rewarding for the professionals within it.
