AI is opening new opportunities to upskill procurement professionals

Editor’s note: Procurement Pulse is a monthly look at a topic or trend that is impacting the procurement function at organizations of all sizes. This month, we look at talent. If you are interested in future topics, you can see a full list of upcoming features on our Editorial Calendar.

Supply chain is facing a talent shortage. It is also on the precipice of a technological revolution thanks to artificial intelligence. Is there a way to use one to address the challenges of the other, without replacing staff?

A Gartner survey in September 2023 found that 46% of employees felt their organizations were supporting them in their career growth. That means 54% do not. Turnover can be an expensive proposition for companies, costing tens of thousands of dollars in each new employee hired to replace and existing employee, not to mention concerns over “brain drain” of knowledge.

“Most organizations are providing managers with resources to support employees and implementing processes to monitor the execution of career development activities in an effort to meet employees’ expectations for growth,” said Keyia Burton, senior principal, advisory in the Gartner HR practice, said in a release announcing the survey results. “Yet, organizations fall short in meeting employees’ expectations due to a mismatch between what organizations can feasibly provide and what employees expect.” 

AI can help

One of the challenges in retaining talent in procurement is the cost to upskill that talent. Corporate training firm Skills Dynamics, in a recent white paper, noted that 20% of surveyed companies planned to spend less than $25,000 on training budgets. Another 7% said the budget was between $25,000 and $50,000 and 3% noted it was between $75,000 and $100,000. Significantly, 29% said they had no specific training budget and another 31% were not sure what their budget was.

“Therefore, despite skill shortages reported in the survey as the second biggest challenge supply chain and procurement teams are facing, organizations are just not prioritizing the budget needed to solve this issue, which leaves many professionals fighting their way through their everyday roles only on the skills they have picked up on the job. Since the unpredictability of the supply chain is hardly going to cease anytime soon, skill shortages will continue to be a problem until companies realize their budgeting mistake,” the white paper noted. (You can download the full white paper, Skills Report 2025, here)

For companies short of budget, artificial intelligence offers an upskilling opportunity. In addition to implementing the technology to automate certain procurement tasks, including supplier negotiations, AI can create an in-house digital pathway to career advancement.

A 2021 McKinsey survey found that 99% of companies said they need more digital supply chain talent to support their digitization plans. The survey found that 55% of companies would like to reskill their existing workforce to meet the digital future, with 52% hoping to hire outside talent, and 30% redeploying existing internal labor force.

“The integration of AI in the supply chain is not a distant prediction but an ongoing reality,” EY wrote in a 2024 white paper on the topic. “For example, in a 2024 EY survey, 72% of respondents say their employees are using AI at least daily in the workplace. As more companies begin to integrate AI use cases into their supply chain, job requirements are rapidly shifting. Traditional roles are being redefined, necessitating a shift in skill sets, where adaptability and technological fluency become critical.”

EY noted that to close the skills gap, organizations must develop leaders that are technologically savvy. “Leaders must be equipped not just with a foundational understanding of AI and automation, but also with the strategic foresight to harness these tools for innovation and competitive advantage,” it said.

Investing in AI-driven tasks

While many fear that AI will replace workers, that is not necessarily the case. Erin McFarlane, vice president of operations at Fairmarkit, told Supply Chain Management Review in a July 2024 interview, that automating tasks such as procurement with AI enables staff to focus on more value-added tasks.

“There’s a whole bunch of work that happens in procurement and supply chain that is rote where you’re picking up something from column A and you’re putting it in column B—you are copying something from one space to another,” McFarlane said. “It doesn’t require a lot of human thought. You go by the rules and the rules are pretty clear. You can have almost anybody do it. That’s the stuff you automate. And whether it’s automating on the supplier side, the buyer side or automating on the requester side, it doesn’t matter because nobody wants to be doing it. It’s not interesting. What happens is if you automate the boring stuff, then what you can do is take those people who frankly didn’t have very exciting jobs or are spending a lot of their time doing not exciting work, and reallocate those people and move them into something more interesting.”

Related Resources

 

Skills Report 2025: Supply chain and procurement trends

The persistent labor shortage hasn’t been kind to any sector, but the supply chain industry has shouldered a fairly high percentage of the burden over the last couple of years. At the heart of this crisis lies not only soaring unemployment rates, layoffs and increased employee churn for warehouse, transportation and logistics employees to name a few, but a skills gap that traditional hiring practices just can’t bridge. Download this white paper from Skill Dynamics to uncover in-depth research on: 

• The exact skills most sought out by supply chain and procurement leaders
• How supply chain skills have differed over time – and where the gaps are
• The power of eLearning to reduce employee churn and keep top talent

Download

 

Deloitte, in a blog post, noted that a lack of skilled employees in areas such as Generative AI “can result in improper implementation and management, and lead to poor performance or system failures.” It noted that organizations found employees that were curious, adaptable and technology proficient as good fits for roles overseeing Generative AI initiatives.

“Generative AI has the potential to further widen the gap between the Orchestrators of Value and other procurement organizations. Hence, it is important for CPOs to start acting on it now and deploy it in the right way,” Deloitte noted.

The consulting firm added several steps in building a Generative AI-enabled procurement function, but one of the key pillars is to build a foundation of technology, data and people.

That foundation is opening up new job opportunities for employees if the companies choose to invest in them. In the Skills Dynamics white paper, 30% of employees somewhat disagreed or strongly disagreed with the following statement: “Training and development are a priority for my organization.” Only 43% of respondents somewhat agreed or strongly agreed with the statement “my organization invests sufficiently in my training and development.”

“Supply chain and procurement professionals are struggling with cost savings and skills shortages amidst rising inflations, cut budgets and lack of support when approaching recruiting and training opportunities,” Skills Dynamics noted in the paper. “The need for niche skills is greater than ever, from negotiation and contract management to quality and process improvement. Professionals are feeling uneasy about how their role and teams will evolve—and often that solution starts with something beyond their immediate control.”

Smart companies, the firm noted, are “putting more effort and resources into recruiting, training, upskilling, and retention to empower supply chain and procurement professionals.”

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