New Year Insights for the procurement solutions and services marketplace 2024: Ivalua

For several years now, Spend Matters has been collecting and publishing a series of articles about procurement, supply and services trends for the year ahead from expert tech and service providers in the market.

This year we’re highlighting the customer demands, market movements and advances in procurement tech that are exciting the world of solution providers, how they expect them to shape the S2P landscape next year and how they plan to respond to them.

Our series runs from mid-December to mid-January, then our senior analysts will wrap up with their own take on the key themes that emerge.

In no order of preference, other than by the date they arrived in our inbox, today let’s hear from Pascal Bensoussan, Chief Product Officer of Ivalua.

Generative AI’s success will hinge on the professionals behind it

In 2024, AI hype will reach its peak. But, against sky-high expectations, leaders must accept that GenAI solutions are like any other tool — they are only as good as the person using them or the data it is fed. Leaders will reap the benefits while laggards will be disappointed as they fail to adjust how they work to leverage the capabilities of this innovative technology.

To reap the productivity benefits from GenAI, employees must use their knowledge and experience to apply them correctly. Organizations should adopt flexible and extensible AI solutions that can quickly grow to adapt to new use cases, which allow users to control the prompts and address the challenges that matter most to their procurement team. Often, getting large language models to accomplish a task reliably, with consistency and precision, requires several iterations in the development and testing of a robust prompt with proper settings, examples and instructions.

For example, with a robust configuration, GenAI could be used in supplier relationship management to analyze supplier documents like ESG disclosures and contracts, generating queries and recommended resolutions to issues spotted via performance evaluations. This will help firms to identify potential performance challenges and take concrete action without having to scour hundreds of pages of content manually or create collaborative improvement plans by hand.

And let’s hear from Alex Saric, Ivalua’s Smart Procurement Expert.

Organizations will risk ESG non-compliance as they continue to focus on cost-cutting

As inflation continues to bite and geopolitical instability persists, many organizations will be tempted to drive down supplier costs in 2024. But, with increased regulation around supply chain sustainability on the way, organizations must prioritize visibility into the environmental impact of their suppliers.

If they do not, they risk missing green targets, opening themselves up to greenwashing accusations and non-compliance fines. For example, from 2025 the European Council will require firms to report on their indirect Scope 3 emissions — which make up 75% of an organization’s CO2 emissions. Organizations must start overhauling their procurement infrastructure now to overcome data challenges and measure the environmental impact of their suppliers long before regulatory deadlines rear their heads.

Procurement will increasingly turn to Platform-as-a-Service to enable agility in an uncertain environment

In 2024, constantly evolving market conditions and business priorities will continue to demand not just procurement efficiency — but also the agility to adapt, respond and collaborate effectively.

Procurement will continue to face the challenge of swiftly navigating disruptions and adhering to ever-changing regulatory frameworks. The risk of trade wars will grow as a result of protectionist policies. And expectations on sustainability will start to expand beyond carbon emissions to areas such as resource consumption and product reuse as part of a circular economy strategy.

In this context, procurement leaders will increasingly look for flexibility in their technology. As such, Platform-as-a-Service (PaaS) will increasingly become the architecture of choice. Flexible platforms will enable business leaders to easily adjust and adapt their processes and data to address challenges and new priorities. This will enable agile supplier management, while also allowing innovative procurement leaders to drive business innovation and create a competitive advantage for their organizations.

Many thanks to Ivalua for being a part of the series. You can read our Ivalua Vendor Analysis here.

Read our senior analyst’s take on the key themes from the series here.

If you need to find the right procurement technology provider or service for your business needs next year, try Spend Matters TechMatch for a free rapid shortlist.

For granular analysis and comparisons of procurement technology solutions, subscribe to Spend Matters Insider.

As always, reach out to discover how Spend Matters can help with your new year commitments and wishes.