Why AI-Powered Procurement Must Be Part of Your Talent Strategy

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On July 25, 2023, a U.S. Senate Judiciary subcommittee hearing commenced to focus on the “principles for regulation” of artificial intelligence. But something was different about this particular hearing. There was a line out the door and around the corner, leading Senator Richard Blumenthal to comment that he’d never seen that many people interested in attending a Judiciary subcommittee hearing. That’s not even the most interesting aspect of the hearing — what sticks out is that it was attended predominantly by young people. So was a hearing on AI and human rights that took place in June, and another follow-up meeting on AI and copyright.

Early-career individuals have a keen interest in shaping the future of AI. They’re participating in the discussions that will shape policies. They’re interested in fair and human-centered applications, and they’re educating themselves on this topic.

What does this have to do with procurement? At a time when that discipline has trouble attracting and retaining top talent, there’s an opportunity to invest in people, by adopting AI-powered tools. A McKinsey report outlines the opportunity, noting that procurement leaders need to build advanced skills within their teams to compete in today’s volatile environment. People working in the sector need to understand how to use analytical tools for things such as value-at-risk assessments, should-cost analysis and more. AI-powered platforms present the ability to outperform competitors in all those areas.

Interest in AI can be harnessed to attract emerging talent that’s knowledgeable about the opportunities and challenges, yet eager to work with AI tools. There’s a unique opportunity to forge new career paths for procurement professionals that not only create meaning for employees, but also serve as an opportunity to add value to the organization’s bottom line.

Procurement teams are increasingly leading digitization, sustainability and supply resilience initiatives. In rethinking procurement’s role within the organization, building tech-savvy talent becomes the center of the effort. In fact, it’s how we’ll transform procurement from a cost-focused to revenue-contributing function.

According to a recent Deloitte survey, 70% of chief procurement officers noted they had difficulty attracting talent in the last year, and 46% cited critical talent loss as a high-to-moderate risk. Interestingly, that same survey showed 41% felt they had inadequate technologies, and 36% said the biggest barrier to improvement was talent capacity and talent gaps. Only 25% of firms surveyed thought they could identify and predict supply disruptions in a timely manner.

In 2016, the World Economic Forum projected digital transformation could add $100 trillion to the world economy by 2025, and affect every industry. More recently, it noted that young people expect to work in advanced, accessible and automated workplaces. In fact, Gen Zers surveyed said employers’ technology is a factor in accepting a job offer.

With so much potential value from just two shifts — digital transformation and talent strategy — procurement can’t afford to delay shedding manual processes. After all, embracing AI as part of a digital transformation checks all the boxes for the next generation of talent. It provides much more meaningful work which aligns with personal values such as augmenting sustainability practices. AI-powered platforms also help teams work smarter, not harder.

By contextualizing complex data, AI can provide valuable insights and clear savings opportunities. Teams can use the technology to identify and prioritize value-added opportunities quickly. Custom dashboards provide spend intelligence using real-time data and interactive visualizations. The platforms even provide prescriptive and predictive analytics to accelerate decision-making.

Savvy procurement teams are already starting to reshuffle their talent strategy to take advantage of AI. The fact that ChatGPT reached 100 million users in just two months shows the huge interest in the adoption of AI. Companies can’t afford to sit on the fence, or the best talent will migrate to competitors who have adopted AI platforms. There’s a whole new adventure awaiting those who invest in AI platforms, career paths and the future of procurement. If the lines at these Senate subcommittee meetings are any indication, your next procurement hire will expect AI to be a big part of their role.