• Group looking for new relationships with smaller suppliers that can help optimise ways of working and support efficiency efforts.

BT turns to AI to map supply chain long tail

BT turns to AI to map supply chain long tail

Source: BT Group

BT has teamed with Cambridge University spin-out Versed AI to support the Digital Procurement Garage initiative it launched in 2019, to broaden and refresh its supply chain.

In a LinkedIn post, Cyril Pourrat, Chief Procurement Officer at BT, said it was using the venture’s “advanced AI engine” to help identify “Tier 2/3/4 suppliers”.

Versed AI’s technology, based on natural language processing and machine learning, is said to be able to “text-mine” digital content in bulk, and use the information to build a picture of “relationships between organisations, companies, products, and people”. Its initial focus is on producing “supply chain maps”, but indicates there are other applications of its tech out there.

Launched in October 2019, shortly after Pourrat’s arrival from Sprint (BTwatch, #308), the Digital Procurement Garage is said to be aimed at helping BT find and source new technology partners. It received a brief reference in the Group’s latest Annual Report, saying the scheme will “enhance, digitise, and optimise” ways of working within BT Procurement, and “help our sourcing teams become more agile and customer-focused”.

BT has so far flagged three businesses that have joined the programme: Darkbeam, a cyber threat insight specialist; fintech player Paid, whose platform enables freelancers and small businesses to speed up invoice settlement; and SourceDogg, a supply chain management software provider owned by tech investment business Nucleus VP Group. While these are all UK-based and have a procurement innovation angle, Pourrat has indicated the Digital Procurement Garage initiative is not confined to any particular geography or technology category.

Freshening up BT’s vast base of suppliers has become an increasingly hot issue for the telco, as it seeks to cut costs, reduce reliance on its largest partners, and address new-wave technology trends. The Group spent £13.8bn (€15.5bn) with suppliers in its last financial year, to 31 December 2019, with 69% of this going to its top 100 vendors. One of Chief Financial Officer Simon Lowth’s ongoing, key strategic objectives is to deliver procurement savings, and reduced spend with external suppliers is one of the main planks of the reconstituted, multi-billion-pound cost reduction programme he announced earlier in May 2020.