Friday, June 23, 2023

Artificial intelligence is revolutionising purchasing

Source: pixabay.com/Gerd Altmann

14th BME-eLÖSUNGSTAGE with 1,000 participants took place in Düsseldorf this May: The two-day specialist congress explored the questions of what contribution AI platforms can make to increasing efficiency, reducing costs and minimising risks in 2023.

"Artificial intelligence is changing the rules of the game, and purchasing is no exception. Our motto #skillup4digital therefore takes on an explosive new meaning," emphasised Dr. Helena Melnikov, Chief Executive of the German Association of Materials Management, Purchasing and Logistics (Bundesverband Materialwirtschaft, Einkauf und Logistik e.V. - BME), in her opening speech at the 14th BME eLÖSUNGSTAGEN in Düsseldorf on Tuesday, 23rd May 2023.

In the centre of the Areal Böhler, 100 renowned speakers from research and industry met 1,000 participants to discuss the move into the digital future of purchasing. The most important trade event for eSolutions and eProcurement in the DACH region examined "the groundbreaking megatrends and potentials of AI to increase efficiency, reduce costs and mitigate risks," Melnikov added.

There are already numerous applications that are transforming corporate purchasing and procurement. One key example Melnikov cited is predictive analytics: AI can analyse historical data on supplier performance, price fluctuations and changes in demand to make accurate predictions for the future. This allows companies to optimise their purchasing strategies and secure their supply chain.

In addition, AI could automate many routine purchasing tasks, such as invoice verification or order management. This saves time and resources and allows purchasing teams to focus on more strategic tasks.

"However, AI's capabilities do not end with automation: by analysing data on delivery times, quality and prices, it can also evaluate supplier performance. This helps the buyer to identify disruptions in their supply chain and address them at an early stage," concludes Melnikov.

Martin Traxl, Head of Strategy and Digitalisation Corporate Procurement of the Austrian oil, gas and petrochemicals group OMV, pointed to the successful "transformation of procurement towards value creation". In his statement at the opening plenary, he emphasised that in the past five years, OMV Group Procurement has managed to become a valued partner for business, recognised both throughout the company and externally. According to Traxl, this has been achieved primarily through the establishment of an integrated and global purchasing organisation, harmonised, simplified and automated procurement processes, and the realignment of the procurement IT landscape based on OMV's digital strategy.

"Digitalisation in purchasing is progressing, but there is still a lot of room for improvement," says Dr Florian C. Kleemann, Professor of Supply Chain Management at Munich University of Applied Sciences. This applies in particular to the use of e-tools, which remains expandable. According to surveys, electronic solutions for optimising quality and supplier management, for instance, are still rarely or not at all used by purchasing. According to Kleemann, this cannot be due to a lack of tool options. Indeed, the tool landscape is becoming more and more diverse and AI is likely to be used by procurement in a targeted manner in the near future. The reasons why there is a lack of implementation that can be expanded have "relatively little to do with the technology, but rather with the purchasing organisation". With regard to the expected digitalisation journey of purchasing, Kleemann pointed out that the technology for more digitalisation is available, digitalisation is not just a question of company size and purchasing itself holds the key to more digitalisation. However, sufficient and competent resources are required for this.