Lecture Notes: Mark Pereira and Michael Dwit at DPW Live, Amsterdam

Introduction

• Speakers: Mark Pereira and Michael Dwit (Walmart's CPO)
• Topics Covered: Michael's journey as a CPO, the role of technology and AI in procurement, and Walmart's approach to digital transformation.

Michael Dwit's Background

• Previous Experience: Started in the Air Force, transitioned to procurement.
• Military Influence: Discipline from military service contributes to best practices in procurement.

Current Role at Walmart

• Position: Lead for indirect procurement for Walmart International.
• Responsibilities:
  • Oversees a Global Center of Excellence.
  • Includes technology enablement and digital transformation team.
  • Team size: 200+ including direct and indirect reportees.

Technology and AI in Procurement

• AI Technologies: Significant changes in the last few years.
• AI Negotiations: Started using AI for negotiations with Pactum.
  • Suppliers have positively received AI negotiations.
  • 80% of suppliers prefer negotiating with bots.

Future Tech Stack and Strategies

• Orchestration Layer: Focus on orchestration to streamline processes.
• Category Strategy Development:
  • AI tech used for category strategies.
  • Significant reduction in time and improved quality.

Implementation and Embracing AI

• Change Management: Some resistance initially, but broader adoption achieved through setting KPIs.
• AI Agreement Evolution: Transitioning from traditional SaaS agreements to AI-specific agreements.
• Contract Redlining: AI reduces redlining time by 80%.

AI and Future Procurement Models

• Co-Pilot Concept: A single UI to facilitate procurement processes.
• Impact on Workforce: Changes in hiring focus, potentially less need for deep procurement knowledge.

Innovation and Piloting AI Technologies

• Approach: Pilot small areas to assess technology impact.
• Criteria for Selection:
  • Vision and strategy of technology providers.
  • Leadership and understanding of procurement in tech companies.

Challenges and Considerations

• Data Management: Data quality is a continuous challenge.
• Smaller Organizations: Advice to start with focused pilots and appoint dedicated roles for tech analysis.

Future of AI in Procurement

• Predictive Vision:
  • Continued evolution towards simpler, more integrated AI solutions.
  • Emphasis on orchestration and autonomous sourcing.

Conclusion

• Advice: Start experimenting with AI technologies despite existing challenges.
• Future Engagements: Encouragement to continue exploring new technologies and trends.

Final Thoughts: Explore AI solutions as they offer transformative potential; collaboration and willingness to adapt are key to success.