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Digital Technologies to Automate the Procurement Process

Procurement’s current trend is centered around digital technologies, which companies use to streamline operational processes. This article provides an overview of various digital technologies used to automate the procurement process, based on research from articles and studies with similar objectives. Embracing technological innovations at the buyer-supplier interface enhances relationships by increasing transparency and trust. Automation and procedure standardization enable more extensive monitoring of sustainability objectives and enhanced data-driven decision-making. This article will therefore investigate how developing digital technologies can revolutionize and streamline procurement procedures. Some examples of digital technologies include procure-to-pay technology, mobile technology, Artificial Intelligence (AI) and predictive analytics, and Intelligent Automation (iA). Thus, leading to greater efficiency and cost savings in the dynamic and rapidly evolving business landscape.

Procure-To-Pay Technology

Procure-to-Pay (P2P) is an integrated process that automates repetitive tasks and improves engagement among stakeholders. Company’s commodity needs are addressed in an efficient and timely fashion, from documentation to invoice approval and payment to the provider. The first phase, with the support of cross-functional stakeholders, is to identify and outline the requirements. After that, requisitions are sent to relevant providers and stakeholders for evaluation of quotations. Purchase orders are authorized and issued to vendors, who then examine and evaluate the provided services or commodities using a delivery order.  Fulfilment of the contract terms by delivering the promised services or materials by the vendor are therefore ensured. Procurement professionals can take advantage of the Enterprise Resource Planning (ERP) system’s historical information when evaluating the provider’s performance. The procure-to-pay cycle includes pay-as-you-go (PAYG) software, which aids in determining what items and services are required, and concludes with a full invoice.  Preservation of transparency throughout the process boosts supplier engagement, optimizes inventory, and simplifies contract administration. Most information regarding transactions, including commodity certifications are tracked. Subsequently, making communication between the supplier and the consumer secure and free of external interference.

Mobile Technology

Mobile devices have become an essential component of our lives, and not just for personal communication. Procurement needs to recognize this rapidly evolving trend, allowing stakeholders to actively engage in procurement functions at any time and from any location. Together with the growing millennial population in the workplace, mobile service procurement procedures will be in greater demand and expectation. Mobility should be integrated into every organization’s procurement strategy. When considering a cloud vendor, mobile-enabled applications should be considered as a critical feature. Organizations are increasingly adopting digital approaches in operations, and procurement is one area where this digital road may smoothly fulfil. Improvement of procurement functions and processes that can cover the complete procure-to-pay system.

Internet of Things (IoT)

IoT and smart gadgets are becoming increasingly crucial for a variety of applications, including at home, during travel, transportation, health and personal care, and construction. IoT involves the use of devices integrated with software, sensors, networks, and other technologies that connect to the internet and exchange data wirelessly. Furthermore, IoT devices contribute to the monitoring of utility and potable water pumps in the industrial area, which is critical to supporting the gas industry. Reliability of the terminal also increase human resource efficiency and data utilization. One such example is the use of IoT technology in the Oil, Gas and Engineering, Procurement and Construction (EPC) sectors. IoT facilitates communication by collecting more data and boosting efficiency, safety, and security.

Robotic Process Automation (RPA)

RPA technology automates repetitive and time-consuming business operations. Organizational processes that are not subject to human error are accelerated. Organizations can use RPA tools to configure software, or record and analyze applications.  These tools can be applied in transaction processing, data manipulation, response triggering, and communication with other digital systems with a “robot”. Procurement bots can automate inventory receipts and the issue implementation procedure in the supply chain. Aside from that, organizations can ensure proper accounting and an accurate inventory of items travelling into and out of the warehouse. This can save thousands of work hours invested in the manual goods receipt and issuance procedure. Additionally, RPA can support job-specific responsibilities such as order management and invoicing processing.

Artificial Intelligence (AI) and Predictive Analytics

Predictive Analytics, an aspect of AI, has the potential to ease procurement issues. The blending of behavioral science, game theory, machine learning, predictive analytics allow procurement teams to predict and retrieve value faster across all categories of expenses. Predictive analytics also uses AI and machine learning to analyze massive volumes of data to find the most profitable historical purchases. The database includes companies who previously provided the best possible goods and services. Summarily, AI and machine learning work together to forecast which outcomes will be favorable for the organization. The methodology then employs human behavior and game theory to generate competition among suppliers. These suppliers are then encouraged to collaborate more closely with the company through dynamic feedback. Finally, an embedded intelligent platform can increase the efficiency of resources without increasing the number of team members required by the organisation.


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Wendy Hoe Shuzhen
Wendy Hoe Shuzhen
Wendy Hoe Shuzhen has substantive experiences in the specialized field of procurement, and specifically in the construction industry. She holds a Diploma in Business Administration from Nanyang Polytechnic and is a member of the Singapore Institute of Purchasing and Materials Management (SIPMM). Wendy completed the Diploma in Procurement and Supply Management (DPSM) on June 2024 at SIPMM Institute.
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