GenAI is a fast-moving technology that will significantly transform the way people work. GenAI in IT sourcing has the potential to drastically alter the landscape, resulting in increased automation and faster, data-driven decision making. Gartner predicts, by 2025, 80% of enterprise applications — such as productivity software, instant messaging platforms and BI applications — will embed a virtual conversational assistant to fulfill content fetching and content generation tasks.
Leaders in sourcing, procurement, and vendor management must explore GenAI’s benefits when sourcing services. They must ensure that their investment in GenAI yields value. The goal is not only to adopt the latest and greatest technology, but also to improve process efficiency and provide solutions that make a meaningful impact. The following are ways in which GenAI can transform IT service delivery and sourcing:
Accelerates the IT Sourcing Cycle with GenAI
Identifying and evaluating potential suppliers is often a difficult and time-consuming process. GenAI can expedite the complete sourcing cycle by utilizing vast amounts of data, including supplier capabilities, historical performance and demand fluctuation. It can also help organizations to identify sustainable suppliers and ensure applicable regulatory compliance.
One of the key features that organizations can quickly adopt is content generation. GenAI can write a compelling requirement for a solution document or proposal suited for each situation and significantly reduce the amount of manual work required. It also has the potential to generate RFP structure based on the organization’s previous data and current requirements, reducing administrative tasks and accelerating the sourcing cycle.
SPVM leaders must identify challenges and understand practical implications of the solutions before adopting any GenAI solution by conducting pilot projects under a controlled environment. The result produced by GenAI requires comprehensive scrutiny by humans.
GenAI Enhancing the Process of Contract Generation to Improve Risk Management and Compliance
GenAI will play a major role in transforming and streamlining the CLM, making the entire process of contract management more efficient. It allows for the assessment of potential risks through analyzing data from diverse sources and predicting potential disruption.
Traditional contract drafting is a time-consuming and highly technical process that requires a specific level of expertise. Companies can reduce their manual workload by utilizing this automated drafting process, which allows them to allocate more resources to their core business activities and reduce their reliance on manual labor. In addition, the risk of human error is significantly reduced as the system generates contracts based on learned patterns. In addition, GenAI can also help to analyze and manage contracts effectively. It can pull out aspects such as cost details, clause characteristics and expiration dates from lengthy contracts in a matter of seconds, making the information readily available to the user. Furthermore, it can contribute value to your negotiation process by analyzing old contracts, SLAs, favorable terms, KPIs and the final outcome achieved.
Organizations seeking to utilize GenAI for IT sourcing must prioritize identifying high-value use cases in order to achieve early ROI. This involves determining where GenAI can have the most significant impact on your SPVM needs and designing an optimized function to better support your organization while also managing risks.
Author Bio: Biswajit Maity, Sr Principal Analyst at Gartner
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