18 Must-Have Negotiation Skills For Procurement Professionals
ChatGPT in Procurement — Revolutionizing the Norm
ChatGPT is getting popular not just in procurement but also in various industries as it assists professionals in their everyday work. However, what is it?
This article will help you know what ChatGPT is. Additionally, we will show you how ChatGPT can help automate procurement professionals in their work.
Once you are done reading this article, you will be able to know the impact of ChatGPT in changing procurement. Additionally, you will be able to use it effectively in your profession.
What is ChatGPT?
OpenAI, an AI research and deployment company, introduced the AI called ChatGPT on November 30, 2022, that answers conversationally complex questions. ChatGPT has been regarded as revolutionary as it is trained to learn what humans mean when they are asking questions.
Many users are amazed at how ChatGPT can provide human-quality responses when they are asking questions. Thus, inspiring the feeling that it may change how humans interact with computers in the future.
An additional layer has been added called Reinforcement Learning with Human Feedback (RLHF) to assist the AI in learning the ability to follow directions and generate human-like responses.
According to an analysis by UBS Switzerland, ChatGPT is the fastest-growing app of all time. In January, only two months after it had been launched publicly, it had already amassed 100 million active users. For you to have an idea of how fast this is for an application, TikTok took nine months to reach 100 million.
How Does it Work?
ChatGPT is a language model which is an improvement over its predecessor GPT-3. It is capable of generating text in a wide range of styles, but with remarkable detail, precision, and coherence compared to its predecessor.
The most basic training of language models involves the prediction of the sequencing of words. Commonly, it is observed as either next-token-prediction or masked-language modeling.
OpenAI used a combination of both supervised learning and reinforcement learning to improve ChatGPT. However, it is the RLHF that makes it unique which uses human feedback in the training loop to reduce harmful, false, or biased outputs.
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How Does it Help Automate Procurement?
ChatGPT is changing the game for each professional in various industries. It revolutionizes the way procurement professionals work. The AI helps assist and support procurement professionals by answering questions regarding the procurement process.
Here are some ways ChatGPT can help procurement professionals:
1. Sourcing suppliers
ChatGPT can help procurement professionals to identify potential suppliers by analyzing supplier data. Additionally, it can identify potential suppliers based on their industry, location, or product/service offerings.
2. Contract management
ChatGPT can provide assistance to procurement professionals by assisting them in managing their contracts by providing information on the contract terms and conditions.
It can also assist you in handling disputes with suppliers and answer your questions about contract renewals.
3. Supplier performance
ChatGPT helps professionals to gauge the performance of their suppliers by analyzing supplier data and providing real-time alerts on any issues. For example, you can ask ChatGPT to provide information about the delivery performance of a specific supplier.
4. Market analysis
It can assist professionals by analyzing market trends and identifying potential opportunities or risks which can help them create a market analysis.
Additionally, ChatGPT can help provide information about the pricing and potential risks associated with a specific supplier or product.
5. Creating quotes
ChatGPT can assist procurement professionals by providing them templates for quotations when they need to procure some products or services with their suppliers.
Additionally, procurement professionals can ask ChatGPT to create a quote to acquire materials or services. Thus, helping you to speed up your process.
6. Answering procurement-related questions
ChatGPT can answer a wide range of procurement-related questions including the definition of terms, regulations, and best practices in procurement.
Additionally, it can help procurement professionals by answering questions such as “what is a purchase request” and “what are the processes involved in the procurement”.
Limitations of ChatGPT
1. Answers are not always correct
ChatGPT is trained to answer your questions that feel right to you. Thus, it can trick you that the output it made is correct. Many users discovered that ChatGPT can provide incorrect answers. Thus, you should always remember that it cannot always be depended upon to provide accurate findings.
2. It is not completely trained
ChatGPT is still undergoing its development. The creator of ChatGPT, OpenAI, suggests that all contents that the AI generates should be consulted and examined by professionals or existing facts available on the internet.
3. ChatGPT lacks insights
An article by The Insider quoted an academic that says that academic essays generated by ChatGPT lack insights about the topic. Although it may exhibit high grammar qualities and sophisticated ideas, it lacks insights.
Is ChatGPT Free to Use?
ChatGPT is completely free, for now. This is due to its “research preview” time to provide feedback on the responses of the AI to improve it better. Sam Altman, The CEO of OpenAI, admitted that it will need to monetize it eventually because of its “eye-watering” costs.
OpenAI also recently announced a new paid, premium version of its chatbot called ChatGPT Plus. It is not available yet, but once it is, it will be priced at $20 per month.
Frequentlyasked questions
+ What is ChatGPT?
ChatGPT is a large language model that can generate answers to your questions with human-like responses or text.
+ How does ChatGPT differ from other chatbots?
Unlike other chatbots, ChatGPT can answer follow-up questions, challenge incorrect premises, admit its mistakes, and reject inappropriate requests.
+How can it help procurement professionals?
ChatGPT can help procurement professionals by answering procurement-related questions, providing them with necessary data for their procurement, and creating quotes to send to their suppliers.
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