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Smart Procurement Technologies for the Construction Sector

Smart procurement technology is moving rapidly in the construction sector. The sector professionals believe that an effective procurement is synonymous to a successful construction project. Technological innovations have an impact on every aspect of the construction industry. There are practical applications and benefits of modernizing the procurement processes. Cutting-edge technology is rapidly evolving, which has a significant impact on how the industry operates and how future projects are executed. To Invest in the latest smart procurement technology is undoubtedly a smart business move. This article discusses some smart procurement technologies that can help to achieve a company’s goal and stay competitive in the construction sector.

Cognitive Computing and Artificial Intelligence

Interrelated procurement smart technologies like Cognitive computing and Artificial Intelligence make it possible to collect, store, organize and analyse all related supplier data which includes spending, costing and contract management to the procurement processes. Besides optimizing the workflow from purchase order creation, invoice processing, and approval, it also automatically incorporates the correct vendor and contract data for swift and optimal purchasing while eliminating and blocking invoice fraud. It enhances and secures contract management and automatic data population from the vendor database. Cognitive computing can check vendors and contractors that are not currently under contract which can possibly give better options than those with existing contracts. In most cases the procurement team will generate suggestions on what contract should be used, how much money could be saved, and other supporting data. It helps to pre-approved legal phrases and templates that allows for much faster contract creation and implementation for contract issuance.

Robotics Technology

Robotics process automation or RPA in construction sector is a software that recognizes, learn patterns and able to perform rule-based tasks. This process is used to automate multiple repetitive manual tasks (e.g., P2P tasks), drive efficiency, reduce errors and risks in execution. Robotics process automation (RPA) solutions also deploy and replicate tasks like processing information, interacting with ERP systems, and sending emails. The procurement function in construction sector has a lot of time-consuming, manual processes that are ideally suited to be used with robotic process automation (RPA) technology. RPA is also a significant contributor in the automation of transactional procure-to-pay processes and in executing and bidding transactions by leveraging systemic controls and well-defined business rules. The RPA software can extract order details from an invoice, use the details to search, find and match the PO in the database. If all documents are matched, it will forward the invoice to the accounting team for payment, resulting to a faster, efficient and accurate transaction.

Intelligent Content Extraction

Optical character recognition and learning algorithms in construction sector is for reading unstructured documents such as PDFs of contracts, specifications and bills of material and extract critical pieces of data like pricing tables, payment terms, delivery terms and termination clauses that would have taken days or weeks to review. It is also utilized to capture documents and incorporate data into the downstream systems. Optical character recognition has been around for a long time but is vastly underutilized in procurement. In Invoicing alone, the amount of time and money that could be saved by using optical character recognition technology and intelligent documents processing (IDP) properly. Optical character recognition (OCR) can actually be a catalyst for further digital transformation in construction sector. OCR technology in the construction sector will help make immutable files searchable, editing files easier and also prevent human errors on top of saving money and time.


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Maricel Punzalan, GDPSCM
Maricel Punzalan (Kim) has 14 years of extensive experience in the specialised field of procurement and contracting, and specifically in the construction industry. She holds a Bachelor degree in Industrial Engineering, and she is a member of the Singapore Institute of Purchasing and Materials Management (SIPMM). Kim is completing the Graduate Diploma in Procurement and Supply Chain Management ​(GDPSCM) on January 2022 at SIPMM Institute.
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