As the role of Chief Procurement Officer has evolved you have taken on, willingly or not, an increased number of responsibilities within your enterprise. Responsibilities that must be handled efficiently and without error for the company as a whole to run and produce as it should. Global use of AI in procurement has surpassed $1 billion, and “94% of business executives believe AI will enhance their operations in the next five years.” The reality is, you must begin leveraging AI immediately to the fullest of your capabilities, specifically agentics.
Agentic AI is the latest evolution of artificial intelligence. It needs minimal human oversight, learns on its own, and can make decisions autonomously based on real-time data. To get ahead of this curve and maintain and grow your lead there are several avenues for you to implement agentic AI now for immediate results.
Sourcing goods
Agentic AI has the potential to check inventory in real time, review sales and demand forecasts, and automatically request new orders or actually create an order with a supplier once inventory reaches preset points. This reduces the chances of running out of stock and overstocking which in turn creates a better flow of operation.
Negotiation with suppliers
Agentic AI processes data, automates operations, and offers critical insights for you when negotiating with your current and potential suppliers. With agentic AI, a large number of potential suppliers can be scanned, their performance information can be analysed, and the best ones, that suit a particular requirement, can be selected. This will speed up the process of identifying the right vendors and consume less time than manual searches.
Contract management and supplier relationship management
Annually businesses lose approximately 5% of spend, or $10,000 to $150,000 due to procurement fraud, and waste and abuse. Humans can only monitor so much, this is where agentics will give you immediate and substantial ROI.
Via Contract Management (CM) and Supplier Relationship Management (SRM) agentic AI capabilities can replace all manual tracking and processes and eliminate your over-reliance on software such as Excel. AI agents can automate contract development, monitor compliance, and even renegotiation.
Agentic AI is capable of drafting contracts, following an already set template and rules, which substantively accelerate the process and limit the number of errors. You can also apply agentic to match proposals on elements that would be beneficial to you or parts that would be overly beneficial to your suppliers.
Risk management and compliance
With agentic AI it is possible to analyse transactions in real-time to the point when a possible compliance-related problem arises it can be flagged immediately. The capacity to lower risk scores around a dynamic set of circumstances makes sure that the riskiest and the most important threats come to the top of the list. Automating alerts for suspicious behavior, Agentic AI helps to react to potential risks faster and minimises the time within which the risk may cause any damage, improving productivity of compliance teams.
In addition to operational responsiveness in real-time, agentic AI provides potent risk mitigation. It uses predictive analytics to identify threats, which could be fraud, regulatory change, or geopolitical disruptions so that an organisation can be proactive instead of reactive. Not only does it improve accuracy and reduce human error, it also eliminates bias in critical judgments by analysing large volumes of data to detect patterns of fraud and automating the process of checking compliance. Early warning systems enable companies to be proactive and make the compliance process proactive and strategic.
Payment processing, cost optimisation and process improvement
In terms of payment processing, agentic AI facilitates smart payment routing, based on real time data in order to select the most optimal paths, automatic reconciliation of discrepancies and improved fraud protection through dynamic payment authorisation. Also, it is possible to conduct international transactions via agentic AI; the conversion of currencies can be automated, the transactions can comply with international regulations, the payment can be monitored in real time, and the transaction would be done automatically without further human intervention within specific conditions.
Regarding cost optimisation, agentic AI lowers the demand of manual labor due to automation of repetitive processes and, therefore, cuts down the operational costs related to human error. It boosts the efficiency of processing, allows more effective use of resources, and prevents and solves disputes and frauds by detecting them in real-time and running a self-contained investigation.
Agentics can improve cash flow management by making predictions of the flow helping organisations manage liquidity and prevent financial penalties. Agentic AI makes continuous process enhancement possible due to the constant learning of new information, rule-directed compliance within workflows, and provides case-specific customer experience.
An undeniable opportunity sits before every CPO in the form of agentic AI. When coded and deployed purposefully and properly it will revolutionize your role, your department, and the company as a whole. To not explore this technology would be negligent at this point. Grab the future by the tail and unleash the power of agentics in procurement now.
Chetan Dube is an AI Pioneer and the founder and CEO of Quant, which develops cutting-edge digital employee technology.