Procurement 4.0 is a transformation of the procurement function to incorporate advanced digital technologies. The technologies can radically change both how supply chains are managed and the necessary staff skill sets for success.

The Fourth Industrial Revolution, named Industry 4.0 (I4.0), has been rolling out across functions for a decade, intensifying as advanced technologies developed and improved. Procurement was not an early embracer of the digital transformation, but over time it has wholeheartedly joined the continuous improvement effort through the use of sophisticated technologies, like blockchain, Artificial Intelligence (AI), cloud computing, Internet of Things (IoT), big data and big data analytics, and robotic process automation (RPA). Procurement 4.0, a subset of I4.0, can use the wealth of available technologies to assist with monitoring inventory levels, managing supply chain processes, smart contracting, and smart logistics. Naturally, this creates new challenges for procurement managers, who need agility to meetthe digital transformation impacting people and processes in significant ways.

Learning from a Pandemic
The application of the new digital technologies in procurement is having a profound impact on everything related to this function - on anything to do with acquiring supplies and services from suppliers. The procurement manager must identify, source, procure, and manage sources, while maintaining alignment with the strategic goals of the business, and assisting staff. When Procurement 4.0 is introduced, everything changes in terms of systems, processes, and talent requirements. For example, AI becomes a resource for analyzing supplier behaviors through pattern analysis, which impacts current suppliers and the selection of new suppliers. Blockchain technology enables global-scale transactions that are technology monitored and managed.