Mastering Product Identification with Dryden SKUs: A Game-Changer in Procurement AI

Introduction to Procurement Data Challenges

In procurement, great ideas often come easy, but efficient implementation is hard. This is the case with product identification. Finding the same product being offered by multiple suppliers is a simple idea, but reliably getting that information, especially at scale for a large number of products, becomes a much harder task. Each supplier has their own way of listing a product, with their own SKU, descriptions and specs. Typically, there isn’t one place you can go to see a product’s listing page at every supplier. To solve this challenge, Dryden Group uses our own unique identifier for each product which we call a Dryden SKU. This is a procurement artificial intelligence solution that lets us identify products across suppliers, in datasets with missing information, and more importantly, it helps us save our clients money. Let’s dig into more depth regarding what we do and why it is needed.

The Problem that Procurement Organizations Face

It is generally not in a supplier's own interests to allow you to easily cross compare products to other suppliers. Why would they want you to be able to price compare? Manufacturer part numbers help, but suppliers often vary the presentation of the manufacturer’s part number or name. We often see only brand names supplied or the parent company name rather than the expected manufacturer. And even if we have the manufacturer name and part number matched up, manufacturers typically use the same part code for all available pack sizes. On the topic of units of measure, is a box the same as a pack? Sometimes yes, sometimes no. Suppliers have their own unique systems of marking units of measures and they, dare I say intentionally, often don’t match up.

The Solution: Procurement AI

So we know the problem: we face a large number of products with mismatched manufacturer part numbers , varying units of measure, and overall disarray in available data, creating a complex challenge in reliably matching products. This is where Dryden comes in with our Dryden SKUs solution! At a high level, we combine traditional machine learning techniques to narrow down possible matches with advanced artificial intelligence. Specifically, we use generative pre-trained transformers (GPTs) such as ChatGPT and related AI systems. These AI models excel in understanding and analyzing text in a human-like manner, which allows us to identify product matches based not only on the similarity of words (semantic similarity) or the number of edits needed to convert one text into another (edit distance), but also on a deeper, contextual understanding of the text. Simply put, Dryden SKUs outperform traditional comparative analysis methods in speed, accuracy, and reliability.

Now, none of what I’m talking about would be hard for a person to do for a given product—repetitive tasks that include SKU research and Excel analysis can be done on a small scale. The challenge is scaling that up to thousands or millions of products. Our system lets us effectively do that. This allows us to catch when someone authorized to make purchases at your company buys a gizmo at a certain supplier when you’ve negotiated a price $100 cheaper at a different supplier or even a subtle price difference between suppliers for a product but which amounts to large savings at scale. Dryden SKUs are also great for transitioning between suppliers, RFPs or any other analysis where you need to compare suppliers and evaluate supplier relationships. Combined with human intelligence, Dryden SKUs help procurement leaders determine areas of focus.

How to Get Started with AI in Procurement

If you have been trying to leverage AI and integrate AI solutions into your procurement processes, look no further than Dryden and Dryden SKUs. Our solution is an easy way for you to gain exposure to procurement AI and start reducing your manual tasks. Here's how we help you deliver cost savings with Dryden SKUs:

• Contact us to set up an introductory conversation. We will discuss your procurement process, your cost savings goals, and how Dryden SKUs can support your objectives
• Next, we will do the heavy lifting to gather necessary procurement data. Typically, this existing data is historical data on product purchases. It doesn't matter if the data is external data, supplier data, internal data, or unstructured data. Regardless of the source or data quality, we want to gather vast amounts of information to provide as many data driven insights as possible.
• From the gathered invoice data, we run the Dryden SKU analysis. The deliverable is a detailed report that provides you with cost saving opportunities on a line-by-line basis. The report becomes available to you in Dryden's spend analytics tool.
• The real work begins after the Dryden SKU analysis is complete. How do you go from advanced analytics, to actionable insights, to actual decision making steps? With Dryden by your side. We drive the realization of cost saving opportunities identified in the analysis. For example, projects may include:
  • A strategic sourcing event to gather market data and evaluate a broader basket of suppliers.
  • A supplier performance evaluation to improve your supplier relationship management and leverage existing relationships.
  • An evaluation of your existing procurement systems to further understand why there's so much fragmented spending.
  • An inventory management review to optimize existing products stock
  • A process efficiency and process automation project to implement ways to reduce human behavior impacts

More likely than not, improving operational efficiency, supporting continuous improvement and driving cost savings will require a combination of these examples (and more!). However, the first step is to build a business case that turns data driven insights into action steps. Dryden can help you do that and more. Contact us today to learn more!