Global supply chain woes aren’t going to disappear any time soon. Factors such as renewed virus outbreaks and trade volatility will continue to stress the market well into 2022.

It’s not all gloom, though. Hand-in-hand with projections for healthier inventory levels later in the year, we see a rising tide of technology innovations designed to help mitigate the challenges that made 2021 a misery for procurement professionals.

Artificial intelligence-powered systems will be in high demand, due to their advanced analytics capabilities. Supply chain teams are increasingly seeking insights that improve predictability and allow them to become more agile in adapting to changing environments and economic pressures.

In particular, we’re going to see more AI-powered automation in the procurement sector — not in robotics or mechanics, but in a new breed of contract-review tools that can help improve the entire process.

One of procurement’s biggest pain points is the contract negotiation phase. It often takes large companies three to six months to negotiate even the smallest contracts, because it’s typically a highly manual process that is time- and labor-intensive. The issues of 2021 only served to highlight the archaic nature of using a manual process.

The more people who touch a contract, the less efficient and lengthier the lifecycle becomes. Procurement departments looking to eliminate hours, weeks or even months of paralyzingly slow process will implement automated contract tools to speed up these inefficient, risky and time-consuming manual editing and review processes.

AI-powered automation accelerates contract negotiation. It streamlines decision-making on workflows, minimizing the potential for a contract to get stalled with an irrelevant party. It enables learning a company’s playbook and terms, so that redlining a contract takes a matter of minutes instead of weeks’ or months’ worth of back and forth between procurement and the legal department.

In 2022, AI-powered automation will increasingly be used as a tool to ensure that the best contract terms can be achieved. By reviewing data from past contracts, procurement teams can see what worked and what didn’t, enabling them to apply a process of continuous improvement to current terms. As an example, home-improvement companies struggled to source lumber because of supply chain difficulties, scrambling to find new suppliers or renegotiate out-clauses. Because these contracts were reviewed manually, the process stretched out, complexities grew, DIYers were frustrated, and revenues were lost. With automated contract review, it would have been a short and simple matter to corral data from previous contracts to support negotiations with new suppliers, anticipate pricing movement, allow for variables like discounts, and hone renegotiation terms to avoid any break in the supply chain.

Automation will allow procurement teams to cut through inefficiencies arising from the fact that they and legal are looking at the same document through very different lenses. Procurement is focused on optimizing commercial terms, while legal wants to minimize risks and comply with regulations. Automation will also help organizations reduce the workload on legal by suggesting which contracts consist of standard material that legal doesn’t need to review again, and which require an additional level of scrutiny. This can save up to 70% of the time normally spent on contracts review. With automated tools, teams can import edits from relevant, previously reviewed contracts. It also provides valuable data on the organization’s historical approach to managing risk. And when a procurement team works with a new vendor, it can upload the new contract into the automated system. AI-powered tools will detect similarities and anomalies with elegant simplicity.

In 2022, procurement professionals will be more than ready to seize upon new technologies, to strengthen their processes and innovate their way out of a repetition of last year’s supply chain woes. With tighter margins and more complexities to juggle, automation will be a key enabler of the agility and speed required to improve competitive advantage, reduce bottlenecks and bolster strategies to withstand change.

Automation is all about freeing up supply chain and procurement professionals from inefficient contract review processes, so they can focus on strategic tasks such as customer communication, business planning or issue resolution, and be more agile in the face of ongoing upheavals in the global supply chain.

Dan Broderick and co-founder and CEO of BlackBoiler.

Global supply chain woes aren’t going to disappear any time soon. Factors such as renewed virus outbreaks and trade volatility will continue to stress the market well into 2022.

It’s not all gloom, though. Hand-in-hand with projections for healthier inventory levels later in the year, we see a rising tide of technology innovations designed to help mitigate the challenges that made 2021 a misery for procurement professionals.

Artificial intelligence-powered systems will be in high demand, due to their advanced analytics capabilities. Supply chain teams are increasingly seeking insights that improve predictability and allow them to become more agile in adapting to changing environments and economic pressures.

In particular, we’re going to see more AI-powered automation in the procurement sector — not in robotics or mechanics, but in a new breed of contract-review tools that can help improve the entire process.

One of procurement’s biggest pain points is the contract negotiation phase. It often takes large companies three to six months to negotiate even the smallest contracts, because it’s typically a highly manual process that is time- and labor-intensive. The issues of 2021 only served to highlight the archaic nature of using a manual process.

The more people who touch a contract, the less efficient and lengthier the lifecycle becomes. Procurement departments looking to eliminate hours, weeks or even months of paralyzingly slow process will implement automated contract tools to speed up these inefficient, risky and time-consuming manual editing and review processes.

AI-powered automation accelerates contract negotiation. It streamlines decision-making on workflows, minimizing the potential for a contract to get stalled with an irrelevant party. It enables learning a company’s playbook and terms, so that redlining a contract takes a matter of minutes instead of weeks’ or months’ worth of back and forth between procurement and the legal department.

In 2022, AI-powered automation will increasingly be used as a tool to ensure that the best contract terms can be achieved. By reviewing data from past contracts, procurement teams can see what worked and what didn’t, enabling them to apply a process of continuous improvement to current terms. As an example, home-improvement companies struggled to source lumber because of supply chain difficulties, scrambling to find new suppliers or renegotiate out-clauses. Because these contracts were reviewed manually, the process stretched out, complexities grew, DIYers were frustrated, and revenues were lost. With automated contract review, it would have been a short and simple matter to corral data from previous contracts to support negotiations with new suppliers, anticipate pricing movement, allow for variables like discounts, and hone renegotiation terms to avoid any break in the supply chain.

Automation will allow procurement teams to cut through inefficiencies arising from the fact that they and legal are looking at the same document through very different lenses. Procurement is focused on optimizing commercial terms, while legal wants to minimize risks and comply with regulations. Automation will also help organizations reduce the workload on legal by suggesting which contracts consist of standard material that legal doesn’t need to review again, and which require an additional level of scrutiny. This can save up to 70% of the time normally spent on contracts review. With automated tools, teams can import edits from relevant, previously reviewed contracts. It also provides valuable data on the organization’s historical approach to managing risk. And when a procurement team works with a new vendor, it can upload the new contract into the automated system. AI-powered tools will detect similarities and anomalies with elegant simplicity.

In 2022, procurement professionals will be more than ready to seize upon new technologies, to strengthen their processes and innovate their way out of a repetition of last year’s supply chain woes. With tighter margins and more complexities to juggle, automation will be a key enabler of the agility and speed required to improve competitive advantage, reduce bottlenecks and bolster strategies to withstand change.

Automation is all about freeing up supply chain and procurement professionals from inefficient contract review processes, so they can focus on strategic tasks such as customer communication, business planning or issue resolution, and be more agile in the face of ongoing upheavals in the global supply chain.

Dan Broderick and co-founder and CEO of BlackBoiler.