Businesses haven’t had to wait long for AI to bear fruit in Procurement. Despite their relative infancy, AI-driven procurement tools delivered up to 10% improvements in productivity, quality, and cost savings in 2025. In some cases, those improvements exceeded 25%.
But then, is that so surprising? After all, Procurement is a function that’s jam-packed with business processes: issuing purchase orders, reviewing vendor invoices, receiving goods, resolving disputes, maintaining records – the list goes on and on. As long as AI understands how those processes run, it's the perfect tool to make them more efficient and effective.
Process-driven AI works on the basis that when processes work, everything works. It uses process data and analytics to intelligently optimize workflows and operations – whether that’s automating a repetitive manual task to boost team productivity, or improving business outcomes through intelligent decision-making.
With Procurement workloads projected to increase by 10% in 2025, there’s never been a better time to make processes work with AI. So, whether you’re after inspiration for where to start with an AI implementation, or proof points to incentivize investment in AI procurement software, let’s take a look at how AI technology is benefiting companies’ procurement strategy.
Overcoming Procurement challenges with AI
When it comes to any Procurement challenge – be it clamping down on compliance risks or failures, improving on-time delivery performance, or negotiating more favorable payment terms, your processes are the fastest lever for change. It’s here where bottlenecks, duplicate work, miscommunication, and misalignment can fester in your Procurement operations.
And when you put your Procurement processes under the microscope, AI is a trusty sidekick. Procurement teams can use generative AI copilots to diagnose the root cause of underperforming processes. With generative AI’s natural language processing, it’s as easy as asking the copilot questions like:
- How can I improve my on-time delivery rate?
- Where in our procurement cycle are we losing the most time?
- Which steps in our supplier onboarding process could be automated?
And you don’t even have to think up these questions yourself. AI solutions like Celonis Process Copilots will recommend follow-up questions to ask based on insight into your top-line Procurement metrics. But AI doesn’t just help you surface process improvement opportunities, it can also execute processes and tasks more efficiently than human Procurement professionals.
Seven proven use cases for AI in Procurement:
1 - PO processing standardization
Relying on manual, email-based PO acceptance tracking processes opens up Procurement functions to order inaccuracies, delays, and unnecessary effort.
AI solutions can use large language models (LLMs) to ingest purchase order confirmations received via email, and automatically feed the extracted data into Procurement dashboards. Automating PO acceptance tracking to improve labor productivity is a quick win. AI can further drive PO standardization by creating validated, templated documentation.
2 - Planning accuracy and stock health
Inaccurate lead times can stem from manual or infrequent updates, or relying on simple historical averages and small sample sizes. The result? Costly stockouts or excess inventory.
To combat this Procurement challenge, businesses can use AI to analyze historical Procurement data, comparing planned vs. actual replenishment times at the material-plant level, then automatically update master data lead times so they reflect actual supply behavior. Not only does this drastically reduce Procurement teams’ manual effort, but it can actually increase profitability. For example, improved lead times translated into 6-digit quarterly P&L benefits for a Celonis pharmaceutical customer.
3 - Consolidation of supplier master data insights
The more suppliers, the more data Procurement teams have to manage. Crucial insight about supplier performance and lead times can become buried, or can be discovered late when Procurement KPIs have already taken a hit.
Thankfully, AI is a hotshot when it comes to collating and analyzing data. Procurement teams can use AI assistants and copilots to find and report on business-wide Procurement insights, such as supplier performance and master data, so they can make faster, data-driven decisions.
4 - Vendor duplication
Another consequence of large supplier volumes and manual processes across global Procurement operations is the risk of duplicate vendor records.
AI can rapidly identify and remove duplicates from your vendor master data through fuzzy matching, and automatically notify teams if the vendor already exists in their system. By streamlining duplicate records into a centralized dashboard, Procurement teams can resolve duplicate records more easily, optimize payment terms, and negotiate with suppliers more efficiently.
5- Maverick buying
Maverick buying occurs when goods or services are purchased outside contract, supplier agreement, or spending policy terms. And the problem can balloon as a Procurement organization grows or enters new markets.
As well as recommending ways of simplifying the purchase process to minimize the likelihood of non-compliance, AI automation can alert buyers when their PO falls outside approved agreements and vendors – a capability that packaging company Smurfit Westrock introduced in their business. The AI solution can even suggest suitable vendors for buyers’ Procurement strategy.
6 - Free-text requisitions
AI can help mitigate the classic Procurement blunder of creating free-text requisitions for indirect materials that are already available in catalogs. Instead of a manual matching process, AI can identify past PO or catalog items with a similar text description. A major online retailer saw a 2x increase in procurement material utilization as a result.
Even better? AI can automatically group free-text POs, saving Procurement teams from having to manually identify spend patterns from all their unstructured data – ultimately increasing spend under management.
7 - Contract Management
A clear and efficient Contract Management process ensures these crucial documents are processed transparently and in compliance with business objectives and legal requirements.
Since AI can perform repeatable tasks with greater consistency than human teams, Gartner predicts half of Procurement Contract Management will be AI-enabled by 2027. One organization that’s ahead of the curve is B3, the Brazilian Stock Exchange, which is working with Celonis to implement an AI agent to automate contract renewals. The company aims to renew contracts in ten days or fewer – down from 30 days.