Ivalua: Procurement leaders pursue AI, but their IT systems lag

Procurement leaders have ambitious goals for applying artificial intelligence (AI), but most of their current systems are not ready, according to a study from research and consulting firm Ardent Partners and spend management platform provider Ivalua. The report highlights a critical market tension: procurement professionals understand the benefits of AI, as 61% of them see AI as a productivity and scale enabler, but few know how to deploy it consistently and effectively. Whilst 90% of organizations are actively exploring or piloting AI, a staggering 67% are in the ‘overreaching’ quadrant of the report, with high AI ambitions facing underdeveloped governance and fragmented data foundations. Despite the challenges, a meaningful minority of 23% has successfully established ‘AI-First’ procurement thanks to solid data foundations, embedded governance, and integrated workflows - critical aspects to scale AI reliably, researchers said in the report, “The Path to AI-First Procurement: Closing the Gap between AI Ambition and Execution.” And crucially, procurement professionals are not asking AI to take over their work but rather to give them back the most impactful and strategic part of their jobs. Nearly half (47%) identify cognitive augmentation as their primary goal for a human-agent operating model, followed by a focus on relationships (36%). However, the path forward has plenty of risk. More than one in three organizations (34%) have no formal AI governance in place, with 96% of respondents viewing black box AI risk as high or moderate. Over half (51%) indicate data hallucinations as their greatest concern, followed by proprietary data being used to train public Large Language Models (20%). While governance frameworks remain scattered, 63% of respondents agree ‘human-in-the-loop’ (or mandating manual approval for critical decisions) is a non-negotiable governance requirement for procurement AI. Data remains the most prominent obstacle, whether it’s quality, availability, or structure, cited by 59% of respondents. This is followed by 51% who mention integration with existing systems as the main challenge. Only 11% of organizations report operating a unified procurement data model across their Source-to-Pay process. Notably, 41% describe their data as integrated, yet dependent on manual reconciliations across systems, 40% continue to operate with fragmented data and no single source of truth, and 8% have dark data trapped in unstructured formats. “Those making tangible progress with AI in procurement are not necessarily moving faster but are rather doing so with strategic intent,” commented Andrew Bartolini, Founder & CRO at Ardent Partners . “They are learning where intelligent systems create the greatest operational leverage, where governance matters most, and how AI can augment execution without creating new operational risks.”