Is Artificial Intelligence in Procurement Mostly Just Overblown Marketing Hype? Basware’s Eric Wilson Weighs In

In Part 2 of our conversation with Eric Wilson, VP of P2P at Basware, we touched on the inherent risks of computers making decisions that have historically been reserved for humans.

While it may not seem as life or death in procurement as it is in the case of, say, autonomously driven Uber-Volvos being involved in rollover accidents, there is still a lot of work to be done when it comes to massaging out the kinks.

How much work, exactly? Are we in the full throes of the revolution, or in the eye of the storm? Enough with the metaphors — here’s the final installment of our conversation with Wilson.

Spend Matters: It’s undeniable that there’s some amazing interplay right now between man and machine in so many sectors. But regarding the application of artificial intelligence both in certain consumer markets in general and as it relates to procurement specifically, what would you say to someone who sees the significance and progress of AI as being overblown or still just a bunch of marketing hype?

Eric Wilson: That is a fantastic question. I would actually probably tell them a story. I would tell them the story of CRM systems in the late ‘90s and early 2000s. During that timeframe, as you probably know, there was a solution called Siebel. It was the absolute gorilla in the world of CRM, and CRM was hotter than all get-out at that time. Just about every member of the Fortune 500 selected Siebel and implemented it, as did many, many other companies. But overnight, Siebel became obsolete — I mean literally, overnight. In that case, what happened was this: software as a service. People would say, “Oh, software as a service is just kind of a trend...” But it absolutely crushed Siebel and crushed that whole industry and, more specifically, [crushed it]. So for people that think today that machine learning is not that big of a deal and is more of a fad, I would encourage them to rethink that, because it will absolutely make systems obsolete that are not taking advantage of machine learning and AI.

SM: What are you guys doing internally on the ‘social listening’ front, and what are you hearing from the marketplace to stay on the cutting edge in developing your technology?

EW: Basware has about 450 people specifically devoted to developing our purchase-to-pay solutions. We're not talking about all the people implementing and support staff, but the actual “propeller heads” that are actually producing products everyday. A significant chunk of those guys is specifically devoted to watching overall technology trends and making sure we continue to take advantage of the ones that have high value and to look past the ones that are kind of gimmicky. But that’s how we are overall keeping track of what's going on in that world, that's why we're having this conversation today — because we want to be on the forefront of applying those technologies to the world of P2P.

SM: What are some of the business pains you’re hearing from practitioners today in terms of their challenges? Are they saying, "Man, I wish I had some AI-enabled technology or platforms to solve my problem,” or is it more basic than that?

EW: Wonderful point. People are not coming to us and saying, "Hey, I wish I had some AI in my procurement world." What they are saying is, "Hey, I've got all kinds of maverick spend,” or “I've got all kinds of paper running through this process,” or “I'm paying late fees to suppliers because I'm not able to take advantage of terms discounts." They're articulating your standard P2P problems. And then the solution to those problems are really today's solution — get all your transactions into one P2P system to solve most of that pain and then, ‘oh by the way, take technologies like machine learning to be able to get more efficient in your processes and free up your people to do other things, or reduce cost through reducing headcount, or get paper out of process. Machine learning is just a way to solve the business problems that customers voice to us but, no, they don't specifically ask for machine learning!

SM: Too bad, because that would be kind of awesome…but makes sense. On a personal note, what's your favorite part about all of this? Anything on the AI front that really gets you going or excites you?

EW: What excites me everyday is creating value for the customer. And our role of course to the customer is [in] the world of procurement, finance and treasury. When I am able to spend time looking at things like machine learning, artificial intelligence, these additional tools that we can plug into our solution to create more value for the customer, that inherently excites me. Then I get to go talk to customers and they tell me about all that they’re getting from it. That's what pumps me up.

Eric Wilson will be speaking at Procurious’ Big Ideas Summit today in Chicago.

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