Some time ago, Bertrand Maltaverne, our Senior Analyst specializing in Procurement, SxM and ESG Technologies, coined the term “automation” when he was analyzing the nexus between automation and augmentation in the digitization process of procurement.
Automation means automating tactical tasks, whether they are repetitive, low-value, or non-strategic, removing humans from tasks to increase efficiency and speed. “Augmentation” means augmenting practitioners and process decisions, and thus outcomes, with new types of collaboration between humans and machines.
While working on Spend Matters SolutionMap data, which ranks procurement technologies according to demos, customer stories, and results of rigorous analysis, he considered scenarios where solution providers are using AI capabilities (the current state of assisted or augmented intelligence) and ML, as well as more first-generation style automation techniques such as RPA and (pre-configured) rule-based workflows.
“When it comes to automation,” says Bertrand. “To give an example of the origins of document technology, from filing cabinets to microfilm, from electronic document management systems (EDMS) and scanners that convert paper to digitized documents on servers, to today’s cloud storage. So everything has been sped up by the transition from analog to digital, and now digital workflows (digitization) are employed instead of physically moving things. can enhance automation.
“What we are now seeing, and have been hearing about for some time, is a concrete example of automation beyond the workplace with AI at the forefront. The first generation of technology was about automating simple tasks, like the manual work of blue-collar workers on a factory assembly line. Now, as automation enters the white-collar realm and automates more cognitive tasks, we are seeing the automation of complex process steps and decision-making.”
Automation and augmentation therefore work together to provide a better decision-making process.
“When it comes to generative AI, ChatGPT is one of the concrete examples of spectacular potential. It raises a lot of questions about the future of work and highlights how modern technologies will enable people to do things that were previously impossible (digital transformation).
“Applying this to procurement, we see AI penetrating areas that technology has barely touched. It brings not only more automation, but also extension, which is the latest element of the latest generation of technology.
“Let’s have a sourcing event. We want to choose the best supplier. Previously, we had to do a lot of work searching for suppliers, filtering them, etc. There may be so many criteria to consider: supplier performance, availability, location and reach, ESG ratings, etc. It has become such a complex task that a human may not be able to keep track of everything, especially when everything is constantly changing. , these sourcing solutions are more guided, recommending suppliers and telling you what criteria to consider and what to include.
“So, ‘automate’ doesn’t mean you’re not in the driver’s seat. The value of AI is to enhance user behavior. Automation doesn’t just mean making things faster (automate), it also means making things better (enhancement). It’s both efficiency and effectiveness.
“There is still a long way to go in AI, but it is here and it is changing jobs. Human-machine collaboration is happening, even though many people don’t fully understand it yet. Those who understand how to use may do so.
“ChatGPT was the first ‘wow’ moment for many in terms of what AI can actually do in their everyday use. Many solution providers are beginning to integrate it into their capabilities, especially in contract analysis. And I think it will be even more.
Keep an eye out for Bertrand’s upcoming series that delves even deeper into ‘automation’.
