Intelligent sourcing automation has matured just in time to help procurement managers deal with a supply chain dynamic that is more volatile, unpredictable, and inflation-ravaged than ever before. Thankfully, intelligent sourcing software can unravel the knotty problems by bringing AI, machine learning and other modern productivity marvels to bear on previously inefficient, manual source-to-pay processes.
Intelligent sourcing solutions takes the drudgery out of supplier identification and vetting, demand forecasting, bidding, and negotiating. Procurement continues to form the backbone for manufacturing and retail organizations, so it makes sense for companies of all sizes to invest in intelligent sourcing automation to achieve immediate, direct costs savings, efficiency boosts, and supplier relationship optimization.
Tools of the Trade
Faster, more precise, and more strategic intelligent sourcing uses predictive analytics to forecast trends, identify suppliers, and negotiate contracts autonomously, with little human oversight or manual data entry. Intelligence sourcing software and tools analyze historical data, identifies trends, and optimizes business procurement strategies.
- Artificial Intelligence and Machine Learning: These technologies enable businesses to process vast amounts of data from diverse sources to predict future demand and make intelligent decisions about suppliers, contracting, and pricing.
- Natural Language Processing: These scanners pull key phrases and items from contracts, terms of service, and other vendor communications to mitigate potential risks, enforce compliance, and highlight areas businesses may be able to negotiate more favorable terms.
- Robotic Process Automation: RPA assigns bots to complete data entry, invoice processing, and order reconciliation tasks based on rules the organization prescribes. This allows procurement teams to spend time on more value-added tasks and eliminates errors.
- Big Data: Intelligence sourcing solutions enrich business’s proprietary data with third-party data from suppliers, markets, and even competitors, yielding deeper insights supplier performance and internal supply chain workflows.
Intelligent Sourcing Benefits
Companies that invest in intelligent sourcing automation today will be better positioned to navigate the challenges presented by tomorrow’s global supply chains. Adopting intelligent sourcing automation futureproofs organizations and positions them to profit from further advances in AI and other productivity technologies. The advantages extend throughout the enterprise:
- Efficiency: Intelligent sourcing accelerates the completion time and ensures the completeness of routine tasks to allow for more revolutions of the sourcing cycle. Tasks like supplier discovery, bid evaluation, and contract management can be completed in a fraction of the time, so businesses can respond nimbly to changing market conditions.
- Accuracy: Intelligent sourcing automation ensures universal, consistent application of business rules to deliver consistent, results free of human keystroke errors. Pricing negotiations and supplier evaluations are completed according to exact criteria, taking emotions and potential laten biases out of the equation. All procurement decisions will comply with industry regulations and align with business goals.
- Savings: Predictive analytics and intelligent sourcing strategies shed light on areas where businesses can achieve lower costs. With automated comparison and selection, intelligent sourcing can evaluate suppliers based not only on price but also reliability, quality, and service.
- Supplier Relationships: Intelligent sourcing solutions reveal real-time insights into supplier performance, giving businesses the leverage they need to consolidate sources, ensure adequate supply, and mitigate disruptive supply chain events. With real-time transparency empowering f full understanding of market trends and pricing, procurement teams can negotiate from a position of strength.
- Scalability: As businesses grow, their procurement needs become more complex, often extending across multiple facilities, encompassing multi-modal delivery routes, and necessitating long-term contracts to guarantee access to critical supplies. Intelligent sourcing solutions scale along with business demands, accommodating larger volumes, more frequent purchasing, and greater market and supply chain complexity.
SDI’s Automated Procurement Platform
SDI has built intelligent sourcing automation into our Zeus system for maintenance, repair, and operations procurement. This comprehensive platform collects, processes, and bases sourcing decisions on data and intelligence from across the supply chain spectrum:
- Suppliers: Selecting and working with supply sources is the foundation for long-term procurement success. Zeus gives organizations their greatest opportunity to accrue cost savings and set the stage for valuable, sustainable supplier relationships. The platform bakes in favorable contract terms, quality assurance, and operational advantages. Just as important, Zeus considers and takes steps to reduce the risks involved in engaging with new vendors.
- Markets: Supply market intelligence encompasses a wide range of information, including details about key suppliers, pricing structures, current and future market trends, demand fluctuations, and the overall dynamics of the supply market. Zeus arms SDI clients with data about the specific markets from which they source goods or services, companies can take steps to eliminate supplier performance downturns and vulnerabilities in the supply network that cause delays, quality issues, and price volatility due to supply/demand disconnects.
- Product Categories: Zeus’s intelligent sourcing integrates supplier and market intelligence to create logical and strategic categories of products and vendors tailored to each client’s priorities. This allows businesses to make smarter, faster purchasing decisions because products and services are classified based on market trends, supplier performance, and pricing structures, facilitating more streamlined purchasing processes and quicker turnaround times. By analyzing how much the company is investing in specific products and services, stakeholders gain visibility into areas where there may be overspending or underutilizing resources.
- Costs: By displaying data on the cost drivers that impact an organization’s purchasing decisions and gaining full visibility into overall spending, Zeus helps businesses understand exactly where and how money is being spent. With access to accurate and comprehensive data, these teams can identify areas where costs can be reduced, better negotiated terms can be achieved, or opportunities for supplier consolidation may exist. Cost analytics at both the granular and strategic levels make budgeting more accurate, spending less wasteful, and procurement processes more streamlined.
Contact SDI to see how Zeus and our other supply chain automation services can transform your procurement processes.
