Professional Documents
Culture Documents
2024
Written By
Eng. Hassan Al Heleil
In 2024, Procurement will elevate business. We see three fundamental shifts driving this
transformation.
First, procurement needs to innovate, to use modern digital opportunities to their advantage.
Second, the way procurement operates will be reinvented with a focus on driving value for its
customers and suppliers.
Finally, procurement is stepping up to champion meaningful change in the world.
These shifts will send procurement on a thrilling journey with opportunities, challenges, and the
promise of a future in which procurement takes center stage in elevating procurement as a force
for good.
Theme 1: Procurement Innovation
Companies understand that procurement is crucial for many other aspects next to cutting expenses.
As the attention of companies grows on procurement, it’s changing significantly in today’s business
world.
In 2024, procurement will be constantly merging with the newest innovations, particularly AI. This
leads us to our first three Procurement trends.
2. Conversational 3. Supplier
1. Fast Integration
AI leading to development to
of AI in
increased counter supply
Procurement
productivity chain disruptions
1. Fast Integration of AI in Procurement
The primary drivers for this market
growth are the increasing use of big
In recent findings from Research and data technology and industrial
During the forecast period of 2017-
Markets, it’s clear that AI is already Internet of Things (IoT) in the
2025, the global market for artificial
bringing transformative changes to manufacturing industry, the extensive
intelligence in manufacturing is
how procurement processes and usage of computer-based technology
expected to grow at a CAGR of
supply chains function, delivering and robotics by manufacturing
approximately 55.2%.
substantial cost savings. companies, a significant increase in
venture capital investments, and
cross-industry partnerships.
AI is streamlining supply chains through the Additionally, the synergy between AI and
introduction of virtual assistants, fostering IoT is creating a highly efficient operational
collaboration not only within individual environment, with AI expected to make
companies but also among different entities supply chains 45% more effective in timely
in the supply chain. and error-free product delivery.
TO GAIN THE - FIRST, ALLOCATE - SECOND, ENSURE - THIRD, EXPLORE - FOURTH, EMBRACE THE FINALLY, INVEST IN
TRANSFORMATIVE IMPACT RESOURCES TO INVEST IN EFFECTIVE INTEGRATION COLLABORATION SYNERGY BETWEEN AI WORKFORCE TRAINING TO
OF AI IN PROCUREMENT AI TECHNOLOGIES AND ANALYSIS OF REAL- OPPORTUNITIES WITH AND IOT BY EQUIP EMPLOYEES WITH
AND SUPPLY CHAIN TAILORED FOR THESE TIME AND STATIC DATA TO SUPPLY CHAIN IMPLEMENTING SENSORS THE NECESSARY SKILLS TO
MANAGEMENT, PROCUREMENT LAY THE GROUNDWORK STAKEHOLDERS, AND DEVICES TO COLLECT WORK ALONGSIDE AI
BUSINESSES SHOULD PROCESSES TO REALIZE FOR AI-DRIVEN INSIGHTS LEVERAGING AI’S DATA FOR PREDICTIVE SYSTEMS EFFECTIVELY.
CONSIDER THE COST SAVINGS AND AND PROCESS CAPABILITIES TO ANALYTICS AND PROCESS
FOLLOWING STRATEGIC OPERATIONAL IMPROVEMENTS. FACILITATE EFFICIENT OPTIMIZATION. ESTABLISH
ACTIONS IN EFFICIENCIES. COMMUNICATION AND MECHANISMS FOR
PROCUREMENT. COOPERATION. CONTINUOUS
MONITORING AND
EVALUATION OF AI’S
IMPACT, AND ADAPT
STRATEGIES BASED ON AI-
DRIVEN INSIGHTS.
2. Conversational AI leading to increased productivity
Procurement professionals can simply ask questions like “Find me a supplier for canned
tomatoes in Italy,” and AI quickly retrieves the relevant information. Thus, freeing up valuable
time for market research and strategic decision-making.
Conversational AI can be a useful tool in preparing for negotiations. By copying and pasting
your negotiation strategy into an AI tool, you can identify areas that need improvement and
address any inaccuracies in your plan.
Additionally, conversing with AI tools like ChatGPT can help you gauge the effectiveness of
your negotiation skills. You can prompt ChatGPT to roleplay as the other party in the
negotiation, allowing you to practice and strategize more effectively.
Overall, utilizing conversational AI can enhance your negotiation preparedness and increase
your chances of success.
Action: Plan ahead
It is evident that this technology is going to redefine the Procurement industry. To ensure a successful integration,
businesses must take several strategic actions. First, businesses should develop a comprehensive integration plan
tailored to the unique needs of procurement. This plan should pinpoint specific areas where conversational AI can
provide the most value, streamlining workflows and enhancing efficiency.
Additionally, investment in training and education is crucial to the success of integrating conversational AI in the
procurement. Procurement professionals should be proficient in using conversational AI tools. This inclusivity
ensures that the benefits of this technology are accessible to all, fostering collaboration and informed decision-
making.
3. Supplier development to counter supply chain disruptions
Another lesson that many procurement professionals learned the hard way over the
last few years, is to plan on finding alternative suppliers proactively.
Being proactive helps to assess the possible challenges in the supply chain as a
whole and identify the risks that could affect your product to be delivered to your
customers promptly.
Research showed that in 2023, the main supply chain issues are behind us, but high
inflation is not yet. Next to this, geopolitical issues like we are seeing in the current
wars in Russia-Ukraine and in Israel & Gaza could also affect global supply chains and
the availability of raw materials negatively. There is only one answer for
procurement professionals: making sure to put as much as possible effort into
finding and onboarding alternative suppliers.
Impact: Proactive Planning Should be The New Norm
Being proactive in dealing with this challenge in procurement and the supply chain will give professionals an
edge over those who continually are reactive when problems arise in their operations.
Additionally, It’s important to be a proactive procurement professional given the facts about current food
price fluctuations. According to the World Bank, 78.9% of high-income countries are experiencing food price
inflation. Europe is among the regions most affected by immediate wheat futures.
Procurement teams are very important in mitigating risks within supply chain planning. It’s smarter to find
and fix things that could hurt customer relationships, revenue growth, and overall business efficiency now
rather than waiting for a crisis.
Action: Fostering and Developing Proactive Alternative
Supplier Strategies
This is the key driver for getting less dependent on current suppliers and as a
result, mitigating risks and achieving successful results with your current
suppliers. As well as in the field of mitigating risks, as well as in the
negotiation results. No supplier wants to lose business, and having an actual
alternative gives endless power at the negotiation table. Yes, finding the right
alternatives takes a lot of time. And yes, procurement still might not achieve
all the goals due to external reasons, but this the only way forward in 2024.
Theme 2: Transforming The Operational
Procurement Model
The way Procurement has operated has remained mostly the same despite the
changing world and shifting business landscape of the past two decades. Often,
Procurement is organized to deliver savings through specific roles, divided into
specialized buying teams, and centralized administrative teams.
However, truly adding value in today’s complex world requires integrated solutions
rather than separate specializations. This leads to the need for procurement teams
that drive business impact.
Doing so effectively requires a different set of skills as well as a different value
proposition. It will compel procurement to forecast better, to use real-time supply
chain systems, and to think about how we should organize our work to be future-
proof. Lastly, in 2024, Procurement will come to the realization that suppliers are
more important than ever in achieving its targets.
Procurement has an outdated self-image and 2024 is the year this will change with
the next four trends.
Theme 2: Transforming The Operational Procurement Model
Procurement
Real-time stock &
forecasting with
supply systems
predictive analysis
Procurement’s
Redefining remote
Emphasis on
procurement work
Relationship
setup
Building
1- Procurement forecasting with predictive analysis
• Adding predictive analytics to the procurement processes is not just a good idea,
it’s very important. Thanks to new technological improvements, businesses can
easily use predictive analytics by 2024. Predictions say the global procurement
analytics market will reach $32.3 billion by 2031. Technology, new electronic ideas,
and strong computer systems are making data-driven solutions more wanted.
That’s why predictive analytics will keep growing, especially in 2024
Impact: More businesses to adopt predictive analytics
• Predictive analysis helps procurement experts get useful information to help them
make data-driven and informed decisions. Procurement teams are more able to
forecast demands that will help in gaining more profit and reduce the risks in their
purchasing decisions. To thrive in this evolving procurement landscape,
procurement must wholeheartedly embrace predictive analytics and make data-
driven forecasting the cornerstone of their procurement strategies and supplier
relationship tooling.
Action: Making the most out of predictive analytics
To gain the full potential of predictive analytics in procurement, procurement teams must take decisive action. The
journey of integrating predictive analytics begins by starting to integrate predictive analytics tools into their
procurement software portfolio.
Procurement teams can leverage predictive analysis to optimize their procurement process and make more informed
decisions. You may be wondering how this is possible. Well, predictive analysis can help procurement teams navigate
market fluctuations by identifying the best time to procure materials and the most suitable suppliers to do business with.
By leveraging existing and historical data, procurement teams can streamline their procurement process and make more
effective decisions.
When using procurement analytics, it’s important to be aware of the potential for data breaches and unauthorized
access due to the tool’s reliance on data. Moreover, we cannot deny that predictive analysis will be an important
part of the procurement process in 2024 as it can help procurement teams anticipate potential risks and
opportunities, and make better decisions.
2- Real-time stock & supply systems
Another technological feature that we are eyeing to gain attention in 2024 is real-time systems. The recent
years have taught a hard lesson that any supply risk or disruption in procurement should be identified
immediately. Similarly, if there’s a demand surge, suppliers must be informed promptly. Many companies
couldn’t respond to the pandemic due to information delays and time lags.
In 2024, companies will focus on improving collaboration in their supply networks and implementing more
real-time systems and processes to reduce information delays to zero.
Impact: Changing the way procurement professionals
monitor their products.
Managing sourcing and procurement with
Integrating real-time systems in outdated supply chain management
procurement reduces information time lags infrastructure, which keeps your data
to near zero, providing accurate and up-to- locked and manually updated spreadsheets,
date information on supplies and products. can leave you lagging in real-time changes
that constantly occur in the business world.
• Now that the pandemic is gone, there is still a question that lingers around and
this is, “Will remote Procurement work continue to exist?” The answer is yes,
remote work setup is here to stay. But what should companies do to make sure
team members achieve the best results while working remotely?
Impact for Procurement: Online negotiation skills
• If you have any questions or consultations regarding supply chains and development.
• Eng.hassan.alheliel@gmail.com
• eng-hassan-al-heliel-950398276/Mobile:+966504813276