Artificial intelligence is sweeping across enterprise functions. Yet procurement continues to fall behind, even as pressures mount. New data from SAP Taulia’s AI in Procurement Report shows a widening gap between procurement’s rising workload and leadership’s limited investment.

Only 35% of global leaders see procurement and supply chain management as a priority area for AI investment. Finance, data analytics, and cybersecurity each attract more attention, leaving procurement at a strategic disadvantage.

This mismatch comes at a difficult moment. Procurement teams report heavier demands, tighter risk environments, and growing operational complexity. Yet AI funding remains slow.

Rising Pressures, Slow Progress

Procurement teams feel the strain. Seventy-two percent say demands increased during the past year. They face complex supplier ecosystems, volatile markets, and expanding compliance requirements. Although 44% believe AI will solve many of these challenges, executive prioritization remains low.

Leaders agree on AI’s potential impact. They highlight risk detection, data-led decision-making, and spend analysis as major opportunity areas. They also expect AI to streamline sourcing, accelerate tendering, and automate invoice processing. These improvements could shift procurement toward more strategic work.

However, interest levels vary sharply by region. Just 20% of UK leaders prioritize procurement AI investments, compared with 44% in Australia and 41% in Singapore. U.S. leaders sit at 37%. These gaps show a global function moving at different speeds.

Procurement Teams Use AI, Even Without Leadership Backing

Despite limited investment, procurement teams are not waiting. Many already use AI-powered procurement platforms such as SAP Joule, JAGGAER, and Ivalua. Generative AI tools like ChatGPT, Copilot, and Gemini are also widely deployed.

This early adoption is paying off. Ninety percent of leaders using AI say automation lets their teams focus on higher-value work. They report stronger supplier relationships, better risk oversight, and more strategic impact. Moreover, 87% say AI insights strengthen procurement’s influence in business decision-making.

These numbers show a function willing to modernize, even when broader enterprise strategy lags behind.

Barriers Slow Enterprise-Wide Adoption

Leadership concerns continue to slow AI uptake. Data security and compliance worries top the list. Limited internal AI expertise and misaligned digital strategies add further friction. Practical issues such as poor data quality and workflow integration uncertainty follow close behind.

A deeper cultural barrier persists. Thirty percent of leaders still view procurement as an operational unit rather than a strategic one. This perception makes investment harder to justify, despite the function’s growing importance.

Experts warn that this mindset puts organizations at risk. Volatile supply chains demand predictive intelligence, not manual firefighting.

Industry Voices Call for Faster Investment

SAP Taulia Chief Product Officer Danielle Weinblatt argues that procurement sits at the center of business resilience. She notes that AI can transform how organizations manage risk, relationships, and working capital. She calls for investment that balances immediate needs with long-term vision.

NTT DATA’s John Roberts reinforces the urgency. He says AI is already elevating procurement from back-office support to a strategic business partner. For him, automation unlocks time for deeper supplier collaboration and stronger risk detection. He warns that procurement cannot afford to fall behind in this new industrial revolution.

TELUS Director of Procurement Ashifa Jumani highlights another key issue: mindset. She says leaders must position AI as an augmentation tool, not a threat. When AI handles repetitive tasks, teams gain time for negotiation, relationship-building, and long-term value creation.

The Road Ahead

Procurement knows where AI can deliver value. Teams are already using tools that enhance performance, reduce risk, and improve decision-making. Yet investment continues to trail behind other functions.

The report reveals a clear paradox. Procurement professionals understand AI’s potential, but many leadership teams remain hesitant. Without a shift in perception, organizations may miss a critical opportunity to strengthen resilience during uncertain times.

The companies that close this gap first will shape the next era of procurement—one defined by intelligence, automation, and strategic influence.

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