‘The ROI of AI in procurement isn’t always about speed or savings. It’s also about better decision-making, supplier transparency, and creating space for value-led work.’

The buzz around AI isn’t slowing down, and in the procurement space? It’s ramping up.

Last week, at Talent’s Future Trends for AI and technology event in our office in Melbourne, the room was full of procurement and professionals asking the same question: Where is AI taking our industry and how do we keep up?

With the expertise of APA Group’s Head of Procurement Excellence, Lexia Laracy, and Leader of Technology & Corporate Category Management, James Sharman, the session unpacked what’s happening on the ground right now, what’s failing, and where the biggest opportunities are.

1. AI is here but most are struggling to use it well

From forecasting and spend analytics to supplier risk and contract automation, AI is already weaving its way into procurement teams. But there’s a gap between what’s possible and what’s actually working.

“85% of AI projects in procurement fail.”

The reason? Not the tech but everything around it: unclear strategy, messy data, lack of governance, and resistance to change.

Executives are excited but often frustrated. They want transformation at speed, but pilots don’t scale, outcomes aren’t clear, and the data foundations just aren’t there.

APA’s take? The tools are only as good as the ecosystem they’re plugged into.

2. A human-centric, data led shift

Throughout the session, one key idea kept surfacing: AI is not replacing people, it’s reshaping roles.

With automation taking over admin-heavy tasks like invoicing or basic sourcing, procurement teams are shifting from “process runners” to strategic advisors, ESG partners, and relationship builders.

But that shift isn’t automatic. It demands new capability frameworks, role redesign, and a serious focus on bringing multi-generational teams along for the ride. Some procurement veterans fear being replaced. Digital natives are frustrated by the pace of change. Lexia and James stressed the importance of clear communication, active change management, and recognising the value all generations bring to AI adoption. Lexia and James stressed the importance of clear communication, active change management, and recognising the value all generations bring to AI adoption.

3. Procurement is uniquely positioned to lead AI adoption

One of the standout moments was when Lexia described procurement professionals as the connectors of the business.

Unlike siloed functions, procurement touches almost every corner; finance, legal, risk, sustainability, tech. This makes them a natural fit to lead AI adoption. But it also means the stakes are higher if things go wrong.

To avoid the common traps, APA and other leading teams are focusing on a few core areas:

• Governance first: Align AI with ethics, values and strategic risk tolerances.
• Data integrity: Poor data in = poor outcomes out. Procurement must own its data foundations.
• Process documentation: AI can’t optimise what it doesn’t understand. Every manual workaround is a future barrier.
• Use case prioritisation: Start with what matters, risk, cost, ESG, efficiency and build from there.

4. Rethinking ROI: It’s not just about speed

The ROI of AI in procurement isn’t always about speed or savings. It’s also about better decision-making, supplier transparency, and creating space for value-led work.

Tools like predictive supply chains, generative tender creation, and supplier risk scoring are just the beginning. APA highlighted the value of focusing not only on technology ROI, but also on people ROI, freeing up skilled procurement talent to do the high-impact work they were hired for.

And while off-the-shelf solutions can look shiny, the panel reminded us that customisation isn’t always the goal. Standardisation and usability are what drive adoption at scale.

Key takeaways

1. Don’t get distracted by the hype. Focus on data, governance, and change management before chasing shiny tools.
2. AI is a capability amplifier, not a magic fix. It works best when it complements human expertise.
3. Procurement has a chance to lead. With their cross-functional influence, procurement professionals are well-placed to drive meaningful AI adoption.
4. Every organisation is on a different journey. Whether you’re in firefighting mode or thinking digital twins, the key is progress over perfection.

“We don’t want to be the 85% that fail. Let’s build systems and teams that give AI something meaningful to work with.”

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