Welcome to the October 2025 edition of Gordon’s Window with Gordon Donovan, your comprehensive guide to the latest shifts and challenges in global procurement and supply chain management. Save your own time reading research when you can get the key takeaways in one place!
This month’s report focuses on the strategic transformation of procurement and accounts payable (AP). There’s lots of research covering AI including deploying AI-powered orchestration, elevating procurement from tactical operations to strategic business partnership with a focus on integrated data, governance and human-in-the-loop decision-making.
AI adoption accelerates spend analysis, supplier collaboration, automation and compliance, but practical barriers persist including legacy systems, fragmented data and organisational silos.
A new review shows that next-generation procurement leaders prioritise resilience, sustainability, innovation and supplier enablement, positioning modern AP and contract management as essential drivers of financial performance and business agility.
ProcureCon
Two procurement reports from ProcureCon this month: one sponsored by GEP about orchestration and the other by ProcureAbility about AI adoption. As they cover some of the same topics, I’ve combined the analysis.
GEP’s report paints an expansive future where procurement evolves from functional process to strategic orchestrator. With 90 percent of leaders facing increasing complexity, the solution lies in comprehensive AI-powered orchestration spanning intake management, end-to-end source-to-pay and cross-domain integration.
The vision is compelling: agent-based architectures converting user intentions into automated subtasks, natural language interactions replacing complex interfaces and procurement professionals freed from tactical work to focus on strategic value creation.
ProcureAbility’s research grounds this vision in current reality. While 92 percent express satisfaction with AI solutions, the implementation story is more nuanced.
Most organisations (59 percent) use AI tactically for specific initiatives rather than comprehensive integration, with 90 percent lacking confidence in measuring ROI. Despite strong investment intentions (88 percent increasing spending), challenges around proven examples and change resistance persist.
Both reports agree on fundamental shifts: procurement democratisation (40 percent of sourcing by non-procurement staff by 2027), the primacy of data analytics investments (70 percent prioritising by 2030) and AI’s role in supplier management and spend analysis.
The success metrics align too – cost savings, sustainability improvements and operational efficiency lead to realised benefits.
However, the reports differ on readiness. GEP’s orchestration vision assumes organisations can leap to comprehensive AI integration, while ProcureAbility’s suggests most remain in moderate implementation phases. This gap between vision and reality reflects the classic technology adoption curve – success stories drive ambitious roadmaps, but broader adoption faces practical hurdles.
Beroe
According to the Beroe report, the strategic role of AI in procurement is now expected to deliver strategic value – cost savings, risk mitigation, supply resilience, ESG impact – not just transactional efficiency.
However, legacy systems and fragmented data block progress. Success, therefore, depends on three pillars:
- Data Excellence (harmonised, contextual, trusted data)
- Intelligent Recommendations (contextual, prioritised insights versus static reports)
- Simplicity and Relevance (role-specific, accessible information)
The report cautions that not all AI is equal. Tasks like invoice matching best suit rules-based AI, while forecasting and risk modelling need predictive or generative AI. Human judgment remains central; AI augments, not replaces, professional decision-making.
The report suggests starting with real, high-impact decision problems. Assess and close data gaps. Prioritise early wins with well-defined use cases and build from pilots to scale, always embedding AI into user workflows and maintaining human-in-the-loop governance.
Barriers and enablers: Data readiness, explainable AI, change management, integration with existing tools and a shift from deterministic to probabilistic thinking are all critical for success. Governance and transparency build user trust.
F5
While 96 percent of organisations are experimenting with AI, only two percent are “highly ready.” Most are “moderately ready,” with AI present in about one-third of applications, used in pockets rather than end-to-end, according to a new report from F5.
Readiness depends on generative/agentic AI deployment, application diversity, model diversity (mix of paid/open-source models), penetration percent of apps using AI and formal practices like data labelling. High readiness means broad, well-orchestrated integration.
Moderately ready organisations:
- Use generative AI and AI agents in production, but are immature in governance/security and lacking orchestration
- Tactics: Use both paid and open-source models for flexibility, starting to deploy AI firewalls and advanced data protection, adopting AI in analytics, security and customer experience
Barriers to high readiness include siloed use cases, inconsistent policies and security concerns, especially around data use and third-party risks. Meanwhile, low-readiness organisations often lack skilled resources and strategy to move from pilots to scaled execution.
Comparison
As these two reports came out in the same month, there are some consistent themes:
Implications for Procurement Leaders
- AI is a strategic partner, not a silver bullet: Both reports stress that AI must be applied purposefully, integrated across processes and always with data readiness and governance front of mind – especially given regulatory, risk and supply chain complexity
- From reporting to decision support: Move away from static dashboards to proactive, explainable recommendations and scenario simulation. AI should guide “what to do next” rather than just reporting on “what happened”
- Collaborative human-AI models: Maintain a “human-in-the-loop” paradigm where procurement professionals validate, explain and direct AI recommendations. This both builds adoption and avoids “black-box” pitfalls
Comparison: Agreements and Contrasts
SSON
This State of Accounts Payables 2025 report highlights AP’s shift from a cost centre to a strategic driver, underpinning cash flow, compliance and supplier relationships.
Top challenges: Manual data entry, invoice matching errors, compliance complexity and increased fraud risk are leading concerns. Only 10 percent feel “very equipped” for e-Invoicing compliance. This emphasises the complexities of e-Invoicing mandates (CTC), global tax/regulation and advanced fraud risks.
The report also highlights the need for integrated, modular platforms and proactive partnership with IT and vendors.
Key metrics include touchless invoice processing rate, invoice processing time, invoices processed per FTE, cost per invoice and late payment rate. These are strategic levers for AP excellence, focused on automation and cost control.
AP teams are adopting AI for touchless processing, fraud detection and vendor inquiries, but most are in early phases, with less than five percent having reached high (>70 percent) automation levels.
Ardent Partners
The State of ePayables in 2025 report, which is a staple of the research community, tracks AP’s evolution from paper-pushing to insight-driven operation over two decades.
COVID-19 accelerated adoption of e-Payables but paper invoices persist (>40 percent) and show that Best-in-Class AP departments achieve $2.65 per invoice cost and 2.9 days per invoice cycle (vs. $12.42 and 13.5 days for “All Others”). Exception rates, touchless processing and supplier enablement are critical differentiators.
The report states that key priorities include the need to deploy comprehensive e-Payables solutions, improve analytics/reporting and supplier enablement.
Supplier participation is identified as the “achilles heel” for digital transformation. Best-in-Class AP teams have much higher adoption rates of automated routing/workflow (80 percent), e-Invoicing (79 percent), e-Payments (77 percent) and tend to use integrated payment networks.
AP’s strategic involvement in cash management, supplier management and business intelligence is growing but uneven. Collaboration with procurement and treasury is essential for resilience (e.g. managing tariffs, payment timing, supply risk).
Today, 44 percent use AI, with 75 percent expected to within 12 months. The main objective is increased automation, but secondary priorities include forecasting, cost reduction and stakeholder satisfaction.
Both the SSON and Ardent Partners 2025 reports position AP as a critical, evolving function, moving from manual, transactional activity to an intelligent, value-generating hub within enterprises.
Comparison & contrast
Both the SSON and Ardent Partners reports stress the importance of tight alignment between procurement and AP for supplier enablement, payment optimisation and strategic sourcing.
Procurement must partner with AP to drive spend visibility, compliance and process innovation.
Both agree that AP must transform into a strategic partner for procurement, finance and the broader enterprise, and that success hinges on automation, intelligent analytics, supplier enablement and compliance.
Both stress that AI adoption and modern e-Payables technologies will accelerate AP’s strategic contribution in the next two-to-three years, but acknowledge that both barriers and opportunities remain.
North Carolina State University
The latest NCSU and GEP study finds procurement and supply chain leaders are finally converging on shared strategic goals, but old operational silos haven’t vanished yet.
Resilience, quality compliance and sustainability now overshadow traditional cost and delivery metrics, reflecting the need to thrive amid ongoing disruption. Despite strategic alignment, execution gaps persist and can cost businesses dearly through slow decisions, increased risks and missed opportunities for supply chain performance.
The report states that orchestration – coordinating people, processes and tech has emerged as the practical fix for these gaps. The study also shows that workflow efficiency and cost savings are the top metrics organisations use to measure orchestration’s ROI. However, adoption faces challenges: data quality, security concerns and skills gaps stand out as the biggest of them.
The report states that leaders should prioritise cross-functional collaboration on risk and financial outcomes, invest in orchestration technology, pilot AI in key areas and balance technical solutions with human readiness.
World Commerce and Contracting
This report, titled “Contract Management: An Overlooked Driver of Business Agility and Financial Performance”, spotlights a hidden source of value erosion for organisations: dysfunctional contract management practices.
The research reveals that businesses lose an average of nine percent annual value due to poor contracting, with top-performing organisations limiting losses to three percent, while the worst experience up to 15 percent erosion.
Procurement leaders are urged to examine how fragmented, slow and rigid contracts undermine agility and financial outcomes.
The report points out recurring structural issues: siloed processes across legal, procurement and finance, inconsistent skills among contract practitioners and severe data fragmentation – contract data is scattered over an average of 24 separate systems. Meanwhile, 83 percent of executives state contracts are too rigid to adapt during market shifts, directly impacting resilience and speed.
Effective contract management enables faster responses to disruption, operational alignment and better exploitation of technologies like AI.
The report’s roadmap to maturity encourages organisations to unlock competitive advantage and financial performance by treating contracting as a strategic enabler rather than a bureaucratic hurdle.
DPW
In October this year, DPW released an e-book from DPW Amsterdam 2024, which has five leading Chief Procurement Officers share actionable strategies shaping the next era of procurement.
Iris van den Harst (Equans Netherlands) urged organisations to start small, focusing sustainability efforts with top-impact suppliers and industry alignment to standardise requests, which builds rapid credibility and measurable change.
Shashi Mandapaty (Johnson & Johnson) frames procurement’s evolution as indispensable to corporate growth, advocating for supplier innovation, data stewardship and an unyielding “no trade-off” mindset to create universal value across customers, employees, suppliers and communities.
Modernising procurement’s operation is another recurring theme. Sopan Shah (IHG Hotels & Resorts) recommends aligning tech with business strategy, leveraging new digital tools and fostering cultures that allow experimentation and intelligent risk-taking.
Klaus Staubitzer (Siemens) shows how embedding resilience across multi-tier supply chains and scaling pilots with clear KPIs turns procurement into a value-driving partner, while ensuring that AI initiatives genuinely support human expertise.
Fannie Boulanger (Airbnb) flips compliance-led procurement on its head, showing how culture-first leadership, speedy category strategy and branding of procurement as a service transform stakeholder buy-in, especially during hypergrowth.
For procurement leaders, these lessons mean building innovation-centric teams, investing strategically in data and tech that empower (not replace) human judgment, and making procurement a central force for sustainable business impact.
As always, reach out to discuss more. I’m always happy to hear your thoughts.
