If procurement 4.0 technologies are making the world smaller for procurement leaders and practitioners, artificial intelligence (AI) is making them smarter. In fact, practitioners everywhere ought to breathe a sigh of relief, since the general consensus is that AI and AI-enabled technologies will augment them — not replace them. But perhaps we are getting ahead of ourselves. Let’s back up.
Unpacking a Loaded Term
Artificial intelligence is not any one technology. Rather, it is an ecosystem of interconnected smart technologies and innovations that, when combined, represent a whole that is greater than the sum of its parts – one that augments knowledge workers, rather than replacing them. But what exactly is AI? It depends on who you ask.
According to Gil Nizri, data scientist and co-founder and CEO of DMWay Analytics, the term, artificial intelligence “has been used, misused, and abused” quite a bit. Data scientists (and some freely-speaking tech marketers) concede that AI as conceived remains largely illusory. Machines that can mimic human cognition, emotions, and problem solving, and that can predict with near certainty future events and plan and execute accordingly are still in development, and have been for decades (“Shall we play a game?”).
Instead, when most solution providers use the term, artificial intelligence, they use it to describe data-driven process automation, analysis and reporting, and task execution that is performed in a seemingly autonomous manner and with a decidedly humanistic flair. But pull back the thin veneer cloaking the technology and the mysteries of AI become less mysterious. At its heart are deterministic or search-based algorithms, written and tweaked by data scientists, that crunch and decipher enormous amounts of structured and unstructured data in seconds or fractions of a second. Data outputs, like user patterns and probabilistic determinations, are used to drive process automation and task execution. In the end, the artificial nature of artificial intelligence is rather artificial in nature. But what does it matter?
AI Makes Procurement Smarter, More Agile
Semantics aside, artificial intelligence is making procurement practitioners smarter, more agile, and more valuable to their teams and organizations. In its contemporary sense, AI is in the advanced data engines that enable users to consume Big Data for procurement – terabytes of data that the human hand could not possibly process on its own. It is in the machine learning algorithms that study user data, that adapt to user workflows, that look for hidden insights, and that reveal hidden sourcing and procurement opportunities or supply risks that the human eye could not see. It is in the deep learning codes that enable machines to replicate human-level cognition, to peel back layers of the problem, like a supplier quality issue, and dig deeper for a solution.
Artificial intelligence is also in natural language processing and speech recognition software that enable users to seamlessly interface with computers and put them to work for us – not for them. It is in the chat bots that pop up in the margins of our desktops and push notifications, like the status of a contract review, or ask if we need help today. It is in Siri, and Alexa, and Cortana, and their ability to answer questions, execute upon tasks, and do it seamlessly. And it is in robotic process automation, which allows users to “outsource” smaller tasks to a bot that are repeatable and scalable, but just are not worth their time. Artificial intelligence is making business users smarter, more nimble, and more efficient.
Final Thoughts
Although solution providers take liberties with the term, artificial intelligence remains an exciting innovation with significant upside for business users. So what if a business tool merely looks and sounds like an intelligent being while the invisible hand of data science pulls the strings from behind? Outputs and outcomes matter more than semantics, especially today. Artificial intelligence is making our personal and now our professional lives easier and more exciting and allowing us to take on more of the strategic, value-added work.
Want to learn more? Download my newest report, The State of Procurement Technology in 2018: The Future is Now, sponsored by Zycus. Click to download.
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