The UAE government has been considering the use of AI to solve real-world problems for the last decade, starting with the establishment of the UAE Council for Artificial Intelligence and Blockchain in 2018.  

In 2021, the Ministry of Finance introduced the Digital Procurement Platform (DPP), bringing about a radical change in the procurement process by incorporating AI.  

This transformative tool not only facilitates communication between federal procurement teams and suppliers but also empowers Chief Procurement Officers (CPOs) to streamline their procurement process. Currently, the platform is being expanded to include a wider range of product categories and offerings.  

At present, the extensive catalog consists of 35 categories, offering access to over 120,000 services and products sourced from 230 pre-approved suppliers 

According to the Ministry of Finance, the platform has yielded significant benefits over the last couple of years. The entire procurement process is digital and simple, cutting down the steps involved from 11 to just 3.  

This massive reduction slashes the purchase cycle time by 75%. Such efficiency doesn’t just benefit the government but sets a powerful example for the corporate sector in the UAE. With these changes, a new “fit-for-purpose data” framework is emerging, influencing how businesses will approach procurement in the future. 

5 Key Digital Shifts in Procurement 

1. Contract Drafting 

As per a recent study of 400 procurement leaders by KPMG, 50% to 80% of procurement work is so repetitive that it can be automated, eliminated or shifted to self-service models.  

Through the adoption of generative AI, CPOs can ensure contract drafting is faster, more accurate, and significantly less labor-intensive.  

It can automate the creation of contracts tailored to specific procurement needs, saving time and ensuring all legal requirements are met with minimal human intervention. 

2. Contract Reporting & Analytics 

Going digital requires data generation, but data generation alone is insufficient. The goal is to analyze and transform such data to make more informed judgments and improve procurement methods.  

We believe predictive AI will play a key role in this shift. Predictive AI working in tandem with prompt engineers, can provide important insights on category and sourcing strategies, process improvement ideas, and supplier development plans.  

It could have the power to analyze previous procurement data to forecast patterns, detect potential dangers, and highlight prospects for cost savings.  

This will help CPOs better understand the expenses connected with the procurement activities they are currently performing. 

3. Contract Editing 

Today, whether you’re sending an email or text message, or searching on your favorite search engine, you get real-time suggestions.  

These suggestions are developed using a combination of data analysis, machine learning, and computational algorithms, with the goal of providing the most appropriate suggestion for each case.  

Contract editing could be made easier, less labor intensive and cost efficient by integrating prescriptive AI into your procurement process, allowing for contracts that are precise, compliant, and in line with corporate objectives.  

Prescriptive AI can automatically analyze contracts for errors, inconsistencies, and potential risks. It can highlight clauses that may need revision or further clarification based on predefined rules and best practices.  

4. Invoice to Pay 

Another large impact area for Generative AI will be revolutionizing the invoice-to-pay process. The accuracy of invoice classification and cash flow prediction is significantly enhanced by AI systems.  

We believe through a combination of generative and predictive AI, detecting and preventing fraud, utilizing powerful anomaly detection algorithms could be inherent. Additionally, seamless integration with legacy invoice management systems could ensure easy acceptance and adoption.  

Use of digital technologies can transform the invoice to payment process into a more efficient, secure, and strategically valuable element of procurement operations. 

5. Supplier Relationship Management 

The above-mentioned KPMG study highlights that supplier relationship management remains a critical area for all CPOs. The study identifies three primary challenges: acquiring essential performance data, strategically managing key suppliers, and addressing inefficient management processes.  

With Generative AI, CPOs can tackle these challenges by automating data collection. It will be able to integrate data from different internal systems, monitor changes in delivery performance, quality, and lead times.  

It can also provide autonomous scorecard evaluations for a select group of suppliers. A combination of Generative, Predictive, and Prescriptive AI will enhance supplier interactions by providing analysis and recommending areas for mutual performance enhancement. 

Future of Digital Procurement 

With Stage 3 of UAE’s Digital Procurement Platform implemented, it’s no more step forward—it’s a leap. A progressive change such as this, in government-to-business (G2B) procurement will inevitably influence business-to-business (B2B) interactions over the next decade. 

Companies like Moglix, for almost a decade, are leading the charge on digital transformation not just in India but also in the UAE, helping organizations in the UAE stay ahead in their digital procurement journey, with its most comprehensive procurement solution.  

Moglix’s Integrated Procurement SaaS Solution, Automated Workflows, and Catalog-Based Buying Solutions, combines with its state-of-the-art physical warehouse network to revolutionize your business’s approach to procurement.