While procurement is an essential function within the enterprise, today's global supply environment requires us to go beyond traditional cost-cutting missions and become strategic partners.
“Resilient Growth: Navigating the Complexity of Procurement” was a virtual event presented by Amazon Business, bringing leaders across the industry to discuss the various factors affecting procurement today.
The speaker included Sandhya Dhir, head of Amazon Business's new solution development. Paula Grickenhouse, Chief Procurement Officer of Bristol-Myers Squibb. Sheila Gundersen, Managing Director of Global Sourcing and Sourcing at SMBC Americas.
The event was hosted by Business Insider contributor Shefali Kapadia.
Naturally, all panelists agreed that AI plays a role in how the procurement department serves other parts of the company.
“AI will stay here,” said Grickenhouse of Bristol-Myers Squibb. “There has been a rapid surge in AI solutions and interest from stakeholders over the past year. We also understand how procurement can distinguish between how AI is used to serve businesses, how to deliver faster solutions, and how to advance analytics.”
Dhir said one of the opportunities seen in AI in procurement is to support inefficient manual workflows or approval chains that result in bottlenecks and monitoring.
“AI can automatically adapt or learn to each client's data and assign tasks within the workflow based on capacity or priority and internal resources,” said DHIR of Amazon Business. “Workflows can be automatically adapted based on user metrics and potential inefficiencies. Furthermore, solutions can leverage GEN AI to create guidance on solutions, such as action recommendations.”
She said that when she was doing tasks multiple times, that was when she started looking for an AI solution. She also said that when establishing an AI workflow, it is important to first build it within additional time. “Expecting the right prompts, the right tools, or creating mechanisms will take some time at first,” says Dhir.
From reactive responses to aggressive planning
Traditionally, sourcing has focused on risk and reactive planning when it comes to supplier relationships, but that has changed, Gundersen said.
“We've definitely moved to understanding how to be more proactive, whether it's from AI or other ongoing monitoring tools,” says Gunderson. “So, it's definitely possible to incorporate that into supply chain management, and risk management is important. I think that's where everyone is moving.”
According to SMBC's Glickenhaus, the majority of the transition comes from data available for collection and analysis.
Glickenhaus cited recent earthquakes and tsunamis as examples of how things have changed. In the past, it took several hours to analyze data and react to how it affects the supply chain. However, when the currently available systems and data are available, that time has been significantly reduced and could be more proactive about the solution.
“We are able to get better positioning in the company as a data collector, and we analyze this data and provide this analysis to senior leaders to help them make the right decisions,” she said.
Access to data and its analysis ultimately proves the value of procurement for the rest of the organization.
“What I'm most excited about is the interconnection between procurement and data use,” says Dhir. “This is a combination that actively partners and supports clients and customers, leverages all of the different solutions we can offer.”
