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1 August, 2019

Maersk Levels-Up Procurement Automation in Partnership with Flowtale


Article By

Lars Andersson, Head of Procurement Automation & Analytics, Maersk 
Michael Teglgaard Nielsen, Director of Science, Flowtale

The increasing complexity of the global supply chain presents new challenges in procurement on a daily basis. But with challenge comes opportunity, and a recent example of this at Maersk is the implementation of artificial intelligence (AI) into our global procurement system, developed by Copenhagen based AI specialist; Flowtale. 

The new system launched in March this year after a 6-month global consultation process with Flowtale’s team of mathematicians, computer scientists, and software engineers – the result of which is a significant level-up of Maersk’s procurement ambitions. New, modular algorithms work on top of the existing process automation-based procurement system, increasing the level of automation and the quality of information available to purchasing agents.

Smooth Sailing

The new system handles requisitions from vessels across the world in real time, 24 hours a day, 365 days a year. On receipt of a requisition, the algorithm looks for a solution for each vessel, based on years of purchasing history per supplier, port, article, catalogue prices and automation rules, while simultaneously optimising the port to which the requisition should be delivered. 

Flowtale’s approach is unique in that it uses only open source code to create modular AI solutions that are scalable and interact seamlessly with Maersk’s existing infrastructure. This allowed us to avoid a costly and complex IT integration programme and has resulted in a quick increase in overall automation rates. 

In fact, since the new system went live four months ago, we are already seeing the full automation of an additional 36% of all requisitions eligible for automated processing. The algorithm processes around 300 requisitions per day, to 260 ports across the world, with the average end-to-end requisition process lasting only a couple of minutes. These numbers are increasing exponentially as the algorithm learns and adjusts from all new data coming in.

The Evolution to Customer-Focused Logistics

A knee-jerk reaction to the subject of artificial intelligence is the fear that robots will ‘take’ jobs from humans. The contrary fact at Maersk and many other corporations is that the primary role of automation is to meet and exceed increasing customer expectations. Compared to the short-term economical gains of replacing human labour, customer experience is the source of long-term revenue growth. It all boils down to a simple equation: the redistribution of human resources from process administration to customer-focused procurement. 

By increasing the automation of straightforward requisitions, procurement agents can now focus on more complex requisitions and strategic value-adding tasks. What’s more, Flowtale’s algorithms offer a richer source of information to procurement agents, from which to provide seamless, faster and higher quality solutions – which is exactly what our vessel managers expect.

The Win-Win

With almost 200 years of history, Maersk is in a unique position to drive new and untapped growth in global procurement. The Flowtale algorithm never sleeps and is continuously learning from all new data coming into the system, with an objective to keep improving on automation rates. A feedback loop between the system and incoming data pipelines serves to improve the quality of incoming data by raising ‘flags’ where there are issues. As it matures, the system will gradually incorporate more complex requests, such as free-text requests based on natural language processing. 

And this is just the beginning. Flowtale is constantly exploring more ways in which technology can break new grounds in procurement and the partnership with Maersk brings us a step closer to unlocking these opportunities.