Why The Robots Will Run Procurement – Pub Debate Arguments (Part 1)

We gave you the highlights of last week’s pub debate here, but today and tomorrow we’ll dig into the conflicting arguments in more detail. The motion being debated was “This House Believes that Robots will Run (and Rule) Procurement by 2020”.

I kicked off the speeches, supporting the motion, and mentioned a recent Oxford University and Deloitte study that rated many different jobs for their likelihood of being automated out of existence. Procurement roles rated as more likely than not to go  – with a 64% probability for “officer” level jobs, 59% for management.

In the case of manufacturing-type procurement, it is already easy to see how that will happen. It starts with taking an engineering / manufacturing specification and converting that to a bill of materials, including working out which materials best fit the requirements. That is clearly a task that can be systemised.

Our “robots” will then search databases of suppliers, which will include Trip Adviser type ratings, to find those that can meet our needs, and issue RFPs to those potential suppliers. These will be evaluated automatically and suppliers chosen without the need for much human intervention. Then the whole range of logistics, planning and indeed P2P administration can easily be carried out “robot to robot”.

Low-value and “tail spend” purchasing is already something that procurement functions are getting out of, using tools such as the SAP Ariba Spot Buy capability. So that leaves strategically important complex services categories as perhaps the main hope for procurement’s ongoing activity. But here, I said, the robots will have allies - our internal stakeholders and budget holders, who with the help of better technology will quite happily take on the “procurement” work themselves.

I conceded that there is a scenario that sees procurement continuing to have a role, working on the more strategic activities and the most important commercial issues, but does the profession have the self-awareness, skills or appetite to make the change?  That really was one of the key points picked up by my debating college, James Marland, in his speech.

James produced the first procurement book ever written  - something about buying for the railways in Victorian times!  He used it to argue that the procurement role has really not changed much over 100 years, so it is very optimistic to think that the profession will rapidly adapt to this new world of AI, robots etc.

He pointed out that serious business degrees and MBAs still don’t teach procurement; we haven’t become the real “profession” we aspire to, and still largely operate in terms of mandates within our organisations. That leads to the situation where procurement will be seen as dinosaurs as technology really kicks in. James also used his own family to illustrate the point that millennial generation prefer to speak to machines rather than humans – certainly on the phone! So this idea that the “human touch” will always have a place is wrong, and there is evidence “we trust Google more than we trust our government”.

So the idea that human judgement and empathy will win out over machines is naïve, according to James. “We should listen to our children – robots know everything, we don’t”.

To sum up the case in favour of the motion: there is no doubt that a very high proportion of what is currently defined as “procurement” and constitutes procurement roles can be automated and have AI applied to it so that the machines will be able to do it just as well as us. The question then is whether procurement can adapt to carve out a new role which really uses human skills that machines struggle to replicate. James and I argued that there is little evidence we will be able to do this; procurement has not evolved much really and these more complex, strategic, “human” aspects might well just gravitate to the budget holders.

So, there you have it - but in our next article we will lay out the arguments against the motion, and see how Jason Busch and Mayank Chandla on the other side of the debate managed to win over the crowd.

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