As Procurement Turns Strategic, Firms Inject AI, Analytics
Providers play crucial role in modernizing procurement systems for higher transparency, efficiency, resilience, ISG Provider Lens™ report says
Enterprises are expanding procurement strategies beyond cost reduction, seeking to optimize processes and reduce time to market, according to a new research report published today by Information Services Group (ISG) (Nasdaq: III), a global AI-centered technology research and advisory firm.
The 2025 ISG Provider Lens™ global Procurement Services report finds that procurement is becoming a strategic priority in mitigating risks and ensuring the continuity of supply chains. While wars, geopolitical unrest and rising tariffs have presented a seemingly unending series of disruptions affecting procurement in recent years, innovative companies are finding ways to make procurement a competitive differentiator.
"Enterprises recognize the need to make their procurement processes more efficient, transparent and resilient," said Robert Stapleton, partner and lead, business process outsourcing for ISG. "At many companies, modern procurement services from leading providers play an important role in these efforts."
Procurement teams are partnering with service providers to implement new technologies that enhance automation, data analytics and collaboration with suppliers, the report says. These include AI, generative AI, advanced analytics tools and robotic process automation (RPA). Dedicated procurement centers of excellence are developing customized solutions to meet specific enterprise requirements. Over the next 12-24 months, ISG expects companies to increase their use of advanced technologies to refine sourcing practices, enrich user experience and improve supply chain collaboration.
The use of AI and automation is rising alongside other technology trends that are reshaping enterprise procurement, the report says. Companies are using advanced analytics for granular visibility into spending patterns, supplier performance and market conditions. They are also embracing strategic sourcing based on benchmarks and best practices to enhance client-supplier relationships. Proactive risk assessments based on real-time data increase provider reliability in an unstable global environment. Circular economy practices, which improve sustainability by reducing waste, are also an increasingly common part of enterprise procurement strategies.
The use of procurement business process outsourcing (BPO) and managed services continues to grow as enterprises seek more flexible operations, ISG says. Strategic sourcing, spending data management and supplier risk and performance management are among the most common outsourced functions, while procurement technology management and sourcing governance are beginning to gain traction.
"Procurement has the potential to transform supply chain management," said Jan Erik Aase, partner and global leader, ISG Provider Lens Research. "Enterprises seek services and technology expertise to maximize the value of procurement systems, and providers are stepping up."
The report also explores other procurement trends affecting enterprises, including the growing need for training to keep pace with technology and the increasing priority placed on cybersecurity in procurement systems.
For more insights into the procurement challenges facing enterprises, plus ISG's advice for overcoming them, see the ISG Provider Lens™ Focal Points briefing here.
The 2025 ISG Provider Lens™ global Procurement Services report evaluates the capabilities of 28 providers across three quadrants: Procurement Operations Modernization Services, Strategic Sourcing and Category Management Services and Supplier Management and Contract Lifecycle Services.
The report names Accenture, Corcentric, Deloitte, Genpact, GEP, HCLTech, IBM, Infosys, TCS and WNS Procurement as Leaders in all three quadrants. It names Capgemini as a Leader in two quadrants and Tech Mahindra as a Leader in one quadrant.
In addition, Cognizant and Tech Mahindra are named as Rising Stars — companies with a "promising portfolio" and "high future potential" by ISG's definition — in two quadrants each. ProcureAbility is named as a Rising Star in one quadrant.
In the area of customer experience, Genpact is named the global ISG CX Star Performer for 2025 among Procurement BPO Services providers. Genpact earned the highest customer satisfaction scores in ISG's Voice of the Customer survey, part of the ISG Star of Excellence™ program, the premier quality recognition for the technology and business services industry.
Customized versions of the report are available from Capgemini, Tech Mahindra and WNS Procurement.
The 2025 ISG Provider Lens™ global Procurement Services report is available to subscribers or for one-time purchase on this webpage.
About ISG Provider Lens™ Research
The ISG Provider Lens™ Quadrant research series is the only service provider evaluation of its kind to combine empirical, data-driven research and market analysis with the real-world experience and observations of ISG's global advisory team. Enterprises will find a wealth of detailed data and market analysis to help guide their selection of appropriate sourcing partners, while ISG advisors use the reports to validate their own market knowledge and make recommendations to ISG's enterprise clients. The research currently covers providers offering their services globally, across Europe, as well as in the U.S., Canada, Mexico, Brazil, the U.K., France, Benelux, Germany, Switzerland, the Nordics, Australia and Singapore/Malaysia, with additional markets to be added in the future. For more information about ISG Provider Lens research, please visit this webpage.
About ISG
ISG (Nasdaq: III) is a global AI-centered technology research and advisory firm. A trusted partner to more than 900 clients, including 75 of the world's top 100 enterprises, ISG is a long-time leader in technology and business services that is now at the forefront of leveraging AI to help organizations achieve operational excellence and faster growth. The firm, founded in 2006, is known for its proprietary market data, in-depth knowledge of provider ecosystems, and the expertise of its 1,600 professionals worldwide working together to help clients maximize the value of their technology investments.
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