Four Predictions for Procurement in 2024 from Gartner

The new report from Gartner, Predicts 2024: CPOs Adjust to Technology’s Impact on Procurement, outlines how new technology is rapidly evolving and changing how procurement will be executed in the future. The research helps Chief Procurement Officers understand how technology is impacting the future of procurement and make plans now to address predicted impact on process, staffing and execution.

This blog highlights four key findings from the report, detailing how procurement needs to adopt AI-powered sourcing technology to both drive cost savings and efficiencies and also allow the business to ‘self-serve’ so that procurement teams can focus on more high-value strategic initiatives.

1. AI-powered sourcing provides a competitive advantage

Organizations will have the ability to run more sourcing events, driving incremental cost reductions to the bottom line while increasing policy compliance. These advantages will give them a competitive advantage. Procurement organizations that do not embrace AI technologies will find themselves at a cost and agility deficit compared to their competitors. Procurement organizations will automate repetitive tasks, such as PR approvals, internal and external communication, and supplier approvals, with virtual agents, enabling teams to focus on other value-add initiatives.

2. Autonomous sourcing solutions 'consumerize' the buying model

AI-infused E-sourcing solutions are increasingly capable of taking on the tasks and decision making that traditionally would require experienced sourcing professionals to do. This allows organizations to effectively "consumerize" sourcing events so that non-professional sourcing staff can scope requirements, identify sources of supplier, setup and run sourcing events that comply with company policies with little to no assistance from the sourcing team. In effect, sourcing is becoming a skill, not a function.

3. Gen AI will improve sourcing speed and efficiency

GenAI use cases will proliferate the full procurement process and have the potential to improve both speed and efficiency across the department. However, it can be expected that procurement professionals will still be central decision makers. GenAI will reduce many tactical tasks, much like traditional AI applications. However, the differentiation with GenAI is that it can generate new content, fill in missing information or even create sample outcomes or scenarios to situations that will ultimately play a supporting role in strategic decision making.

4. Organizations want to drive efficiencies and savings through AI

Interest in AI use cases for procurement has increased dramatically in 2023 – (based on Gartner inquiries with procurement executive leadership and IT leaders responsible for procurement technology on the topic of AI in procurement increased by 17 times in 2023 versus 2022) with organizations exploring ways to drive efficiency and cost savings through practical adoption of AI. This will result in a high number of AI pilots in 2024, positioning acceptance and use of AI to be more pervasive in procurement in the coming years.

Click here to download the full Gartner 2024 Predicts Report with recommendations on actions procurement leaders should take to address the challenges outlined above.

And contact us here for a demo of Globality’s AI-powered autonomous sourcing platform to see how it meets those challenges, delivering 70% efficiencies and 10-20% cost savings instantly.

Gartner, Predicts 2024: CPOs Adjust to Technology’s Impact on Procurement by Micky Keck, Kaitlynn Sommers, Naveen Mahendra, Ryan Polk, Meghan O'Doherty, Lynne Phelan, Fareen Mehrzai 4 January 2024.
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