The procurement industry works through a multitude of interconnected platforms and vendors. And one of the most common connecting nodes between these platforms and vendors is a digital payment gateway.
The Indian procurement sector has many issues surrounding the various digital payment options provided, but what is even more baffling is the amount of cost it raises. Studies show that up to 4% of the overall spending of a high-end procurement agency stems solely from transaction costs. Spending management is a major issue throughout various parts of supply chains, and switching to more streamlined solutions is the need of the hour.
Automation Is The Way Forward
Source-to-pay (S2P) solutions are used by organizations to build a better-controlled process of procurements that takes into consideration everything from operational efficiency to risk management. And this is only possible because a S2P setup is geared towards automating every possible part of the process.
Automating the procurement chains and especially the payment processes results in increased productivity, better savings, and improved relationships. A McKinsey report even shows up to a 10% reduction in procurement costs of organizations using automation-powered S2P systems.
AI-based technology is showing a large array of benefits for many industries. If Indian procurement officers can be early adopters of S2P solutions, the industry will get the perfect boost that it requires.
AI in The Procurement Industry
From analyzing large volumes of data to creating easy-to-use insights, AI-led processes can be applied throughout the procurement process. But when specifically used in choosing vendors and contract management, both cycle time and costs can be reduced.
There is also the factor of increasing the overall accuracy of one’s process. Many times, vendor choice can be a shot in the dark. But with any S2P tool, organizational choices will always be data-based.
Globally, organizations using these solutions are showing massive cost reductions within very short timelines.
S2P is The Gateway, AI is The Future
The Indian procurement industry has to overcome certain challenges that are posed before it. AI is one of the most useful tools of the current tech landscape, but it also comes with its challenges of adoption.
This is even more reason for procurement officers to adopt concepts such as S2P solutions as soon as possible, as these are the early signs of a larger oncoming change in the industry.
AI-driven S2P solutions are going to take over the global procurement process in the next few years, and it’s time to catch up.