Page 24 - WBG March 2025

FEATURE

AI and the Evolution

of the Procurement

Operating Model

Extract from European Leadership
Worldwide Thought Leadership 4.0 for a Global Digital World

The year 2025 looms large as a pivotal moment: Artificial intelligence (AI) is poised to The Beginning of the End:
revolutionize operational models, propelling companies toward new efficiencies and Procurement As We Know It
restructuring how procurement integrates with broader business strategies. Against this
backdrop, trade tensions persist, with localization and sustainability now vying against Procurement is on the cusp of a profound
traditional globalization. transformation. While all functions are
poised to benefit from innovations in
Procurement and supply chain leaders are confronted with profound questions: Will AI AI, few are positioned for such a seismic
transform procurement into a self-directed powerhouse? Can companies balance resilience shift as procurement. As AI tools mature
with cost-effectiveness amid geopolitical uncertainties? and take on more sophisticated roles, the
traditional procurement operating model
This report by GEP, an accomplished firm of consultants and technology advisors offers will become obsolete. The question is not
valuable perspectives to help business leaders strategize for 2025. if procurement will change, but how to
embrace this transformation and unlock
The GEP Outlook 2025: Procurement & Supply Chain report unpacks six transformative value.
trends that will shape procurement and supply chains. Out of the 6 key trends which is in
the link, https://www.gep.com/blog/strategy/key-trends-defining-procurement-and-supply- Today’s procurement function has
chain-in-2025, here is an extract of the 1st trend – AI and the Evolution of the Procurement historically achieved operational success
Operating Model. by mastering supplier management, cost
optimization and risk mitigation, among
other areas. The procurement operating
model is reliant on human expertise
and often struggles with inefficiency,
fragmented data, and labour-intensive
GEP Procurement processes. AI offers a compelling solution,
creating more opportunities to focus on
and Supply Chain strategic, high-value activities.

Outlook 2025 Procurement leaders are already asking:
OUTLOOK Will technology redefine the human role?
Key Challengers, Trends and REPORT Will the procurement function exist in
the future? GEP expects the answer to
Priorities be a resounding yes, but not in the form
2025 procurement leaders understand today.
PROCUREMENT & AI will affect the operating model in three
SUPPLY CHAIN
distinct phases, each more transformative
than the last, as organizations embark on
their AI evolution.

22 W.A.D Beyond Global