Strategic Procurment Initiativest thorugh AI_Final_04.01.2021

1. SSC-SR
NTPC Shared Service Center- Southern Region-
Professional Circle Presentation-2020
VIGILANCE AWARENESS WEEK
NTPC Kudgi NTPC Simhadri
Migratory Birds at
NTPC Dadri
NTPC
Ramagundam
NTPC KOLDAM NTPC SINGRAULI

2. STRATEGIC PROCUREMENT–
PROCUREMENT THROUGH AI
A Presentation By
PC SAAVYAS
MEMBERS :
Ms A SRAVANI
Ms G USHA
Mr R SANTOSH KUMAR

3. Contents
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3
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1
0
7
8
9
6
INTRODUCTION
MATERIAL STORE
MANAGEMENT
ADVANTAGES
TRANSPORTATION
MANAGEMENT
CHALLENGES
WAY FORWARD
3
5
VENDOR SELECTION
INVENTORY
MANAGEMENT
AI IN PROCURMENT
EVOLUTION OF
PROCURMENT

4. Achieving maximum value for the Price is the underlying
Principle of Strategic Procurement
STRATEGIC PROCUREMENT–PROCUREMENT
THROUGH AI

5. What Changes has Procurement seen in
Last 25 years ??
How will Procurement look in
the next 15 years?
STRATEGIC PROCUREMENT–PROCUREMENT
THROUGH AI

6. EVOLUTION OF PROCUREMENT

7. Client
verifications
Audit
replies
Vendor
queries
PBG
Release
s
Follow up
for
delivery
Payment
Issues
Inspectio
n Issues
Vendor
Code
Creations
NEGOTIATIO
N
Document
Approvals after
PO
STRATEGIC PROCUREMENT–PROCUREMENT
THROUGH AI

8. CHALLENGES IN PROCUREMENT PROCESS
 Supply Risk
 Quality Risks
 Potential Fraud
 Urgent Purchases
 Lack of vendor data for some
items
 Process Inefficiencies
 Vendor Evaluation
 Compliance (Legal, internal, and
industry)
 Human Errors
 Too small Purchases

9. Taking a smart look at the future of
Procurement Practices
Artificial Intelligence in
Procurement
STRATEGIC PROCUREMENT–PROCUREMENT
THROUGH AI

10. WHAT IS ARTIFICIAL INTELLIGENCE
10
ARTIFICIAL
INTELLIGENCE
Perceptio
n
learning
problem
-solving,
decision
-making
capabiliti
es
recognizing
objects
Responding to
language

12. 12
AI
APPLICATIO
NS
Virtual
Assistan
ts like
Siri,
Alexa
New
age
Video
Games
CRM
thru
Chatb
ot
Entertai
nments
like
NetFix
Youtube
Navigat
ion &
Maps
Social
Media
Feeds
Smart
Homes
&
Offices
Online
advertise
ments &
Product
recomme
ndations
APPLICATION OF ARTIFICAL INTELLIGENCE

13.  Oxford Insights and the International Research Development Centre
(IDRC) present the findings of our Government AI Readiness Index.
Rank Country Index
1 United States of
America
85.47
2 United Kingdom 81.12
3 Finland 79.23
4 Germany 78.97
5 Sweeden 78.77
6 Singapore 78.70
7 Republic of 77.69
8 Denmark 75.61
9 Netherlands 75.29
10 Norway 74.43
India is in the 40th Position with index 55.98
AI READINESS INDEX 2020

14. MYTHS ABOUT AI IN PROCUREMENT
What is not AI in Procurement What is AI in Procurement
Chrome or plastic –plated Automating or improving many
time-consuming tasks
Replacement of human
Procurement expertise
Procurement experts additional
insights based on extremely
complex and large sets of data
Magic solution you can tap to
your problems
High end software solution
at resolving a specific task

15. 15

16. Indent Management
16

17. Vendor Management
Vendor Database
Vendor
Registration
page
Experience
and
Credential
records
Vendor Selection
Faster
Decisions
Competent
vendors
Vendor
Performance
Evaluation
Blacklisted
vendors
Feedback and
complaints of
EICs
Performance
Rating
Vendor
notifications
Enlistments
Vendor
Selections
Prospective
bidders
Vendor payments
Amount
Dates of
payment
CPG details
Payment
Delays
Vendor
specific
provisions
Option to bid
for specific
NTPC Project
17

18. Inventory Management
18

19. Process Management
Negotiations
Client verifications
Delivery follow ups
Tender document preparation
Process Templates –Integration
with DoP
File Tracking and Alert System
19

20. KEY ADVANTAGES OF AI IN PUBLIC
PROCURMENT
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•ACCOUNTABILITY AND TRANSPERANCY
•INCREASES OPERATIONAL EFFICIENCY
•AUTOMATE MANUAL TASKS AND FREE UP
UP RESOURCES
•BETTER CONTRACT MANAGEMENT

21. KEY ADVANTAGES OF AI IN PUBLIC
PROCURMENT
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•AUTOMATION OF SIMPLE PURCHASES
•SUPPLIER RISK MANAGEMENT
•BETTER SPEND ANALYSIS & PAYMENT
MANAGEMENT
•NEW SUPPLIER IDENTIFICATION

22. CHALLENGES OF AI IN PUBLIC
PROCUREMENT
22
ARTIFICIAL
INTELLIGENCE
IN
PROCURMENT
EFFECTIV
E USE OF
DATA
DATA &
AI SKILL
SET
AI ECO
SYSTEM
LEGACY
CULTURE
PROCURE
MENT
MECHANI
SM
DATA
SECURIT
Y

23. 23
THE FUTURE OF PROCUREMENTS NTPC
Strategic
Sourcing as
backbone of
SSCs
Sanitized Master
Data (Material &
Vendor)
Artificial
Intelligence
driven Demand
Forecasting for
ABB Items
Manually
Finalize
Demand
for ABB
Approval
Generate
ABB PR
Procure
AI
Learni
ng of
Past
Data
and
Trend
s
Revie
w AI
based
Dema
nd for
ABB
Auto
Creat
e PR
Procu
re
AI based
Demand
Forecasting
and Automatic
ABB PR
generation
Procure
Present System
Introductio
n of AI to
Procureme
nt System
Stabilized
AI Driven
Demand
Forecasting

24. WAY FORWARD
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TIME &
RESOURCE
CONSUMIN
G TASKS
OPERATIONAL
EFFICIENCY
IDENTIFY
REDUNDANT
TASKS &
ELIMINATE
DATA
SYSTEMS,
HANDLING
&
SECURITY
AI
INFRASTRUCTU
RE & ECO
SYSTEM
GIVE CLEAR
CHALLENGES
& MONITOR
OUTPUT
APPLY
TO
LARGE
SCALE
PROJECT
EXPERIMENT
HUMAN+
MACHINE
COLLABORA-
TION
PROCUREMENT
MECHANISM
NTPC HAS ALWAYS BEEN AT FRONT RUNNER IN ADOPTING NEW TECHNOLOGICAL INITIATIVES

25. 25
/ntpc
1
/ntpc
ltd1
/ntpclim
ited
/Compan
y/ntpc
/ntpclimit
ed
Follow
Thank You
Website: www.ntpc.co.in |
Migratory Birds at NTPC Dadri
NTPC Ramagundam

26. CONCLUSION
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 NTPC HAS TAKEN GIANT STRIDES IN ADOPTING TO
DIGITAL ENVIRONMENT
 ITS TIME TO LEVERAGE THE DIGITAL ENVIRONMENT
TO ARTIFICIAL INTELLIGENCE
 ENHANCE PROCURMENT MECHANISM TO ALIGN
WITH EVOLVING MARKET DYNAMICS IN THE SECTOR

27. MATERIAL STORE MANAGEMENT
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•Material received and SRV generated
•Inspection and acceptance of material
•Material sent to custody section
•Manual and Physical verification of space
•Identification, allocation of space and
mapping location into system
Existing
Practice

28. AI based Smart Storage Space Allocation
 Dynamics of the entire storage space will be made available
in the application
 Automatic space recommendation and allocation considering
the size, weight, frequency of usage, nature of items etc.
 Optimal Storage space
 Minimal Retrieval time
 No Errors in Bin Location entry
 Ease of physical verification process
 Faster issue of material
MATERIAL STORE MANAGEMENT
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29. INVENTORY MANAGEMENT
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•Manual Tagging of NMI items
•System prompting during PR release for
NMI items with same material code
•Duplicate material codes
•Material cannot be issued after Shelf life
expiry
Existing
Practice

30. AI enabled Inventory Management
 Automatic tagging of NMI items
 Reduces Redundancy in material codification
 Alerts before expiry of Shelf life
 Alerts for items stored for long time
 Prompting similar items whenever PR is created for any item
 Aids in maintaining Optimal Inventory
 Reduction in unnecessary purchases and saves man hours
 Less PRs and Less NMI items
INVENTORY MANAGEMENT
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31. VENDOR SELECTION PROCESS
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•Identifying previous suppliers /
contractors from SAP/SRM/GeM for same
item
•Identifying vendors who have responded
in previous tenders
•Identifying previous vendors for similar
procurement
•Considering new vendors after credential
verification
Existing
Practice

32. AI aided Vendor Selection
 Immediate information of previous suppliers/ contractors
from all portals
 Prompts for vendors of similar materials/ services.
 Suggestions for including new vendors based on online
information
 Checking of banned and blacklisted vendors
 Vendor Ratings and performance feedback from social
media channels
 Online Tracking of latest suppliers status
VENDOR SELECTION PROCESS
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33. TRANSPORTATION MANAGEMENT
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• Supplier intimates Stores about the
readiness of item for despatch
•Stores dept. intimates the authorized
transporter to lift the material
•Specifies the type of truck considering
size, volumetric weight and value of the
consignment
•Transporter engages vehicle as per advice
of Stores
• Material reaches Site
Existing
Practice

34. AI supported Transportation Management
 Supplier raises a call by entering the dimensions, weight and
value of the consignment
 Information is passed to the Stores department with the
recommendation of the type of vehicle and the transporter.
 Automatic message to the transporter after approval from
Stores
 Provides balanced opportunity to all the authorized
transporters.
 Transport tracking
TRANSPORTATION MANAGEMENT
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