Improving spend taxonomy with algorithms: Dutch AI startup Mithra AI is using AI to help companies spend efficiently

In the AI Startup of the Week, the editorial staff of ai.nl is featuring promising AI startups, their innovations, solutions and challenges. In this twenty-seventh episode, we are taking a look at Mithra AI, an Amsterdam-based startup using artificial intelligence to help procurement teams around the world focus on high impact decision making and value realisation for their organisation.

Spend management is both critical and crucial for any company. It is a process of collecting, cleansing, classifying, and analysing the expenditure data. This is done in order to decrease procurement costs, improve efficiency, monitor controls, and compliance.

Future of Spend Management

Artificial Intelligence has the ability to transform a number of businesses, but chief among them are the activities that require manual labour. A lot of man hours can be easily transformed into actionable insights with clever algorithms. Mithra AI is demonstrating that possibility with its product designed for effective management of spending by the procurement team.

The core functionality of the AI product and software suite from Mithra AI hinges on this need for people to move away from “collect data and do the endless & tedious data crunching.”

The Dutch AI startup is replacing that old methodology with a renewed approach centred around AI. The software and algorithms devised by Mithra AI are smart to easily collect and merge spending activity. It also automatically classifies and updates the spending activity. All of this leads to unified spending taxonomy for business leaders across various functions.

With the AI-powered spending analysis, customers deploying Mithra AI are able to instantly capture value. The unique selling point of the product is that it proactively pushes notification about spending opportunities. Mithra AI also claims that there are no IT teams involved and zero “learning curve.”

What you need to know about the product?

Any AI product’s USP gets accessed from factors like ease of integration and the amount of time required to get the service actioned. In the case of Mithra AI, the product offered is a standalone service that requires zero integration or time in the form of product setup. As soon as you get Mithra, it starts to offer instant actionable insights.

This is possible thanks to tailored AI tools, including ML algorithms and human-led analysis. Mithra AI says this approach allows it to offer insights that are proactive and relevant. This approach contrasts the traditional approach of offering a full AI suite that relies on machines to deliver the insights and supervised learning for the algorithm to improve over time.

Mithra AI does not reveal how its AI tools or algorithms work but it is not difficult to understand the fundamentals. The tailored ML algorithm takes the data available about spending patterns and other activities related to spending taxonomy and starts building a pattern. It then matches that historical data to offer actionable insights and even push proactive alerts.

The same data is also run through an analysis AI tool that distils the data into various categories. This ability to categorise the data and then classify it becomes an essential part of Mithra AI’s data management system. AI companies are generally seen as one gobbling data to produce inference but data management is hardly offered as a supporting environment.

What are the use cases?

Mithra AI, despite being a small privately held company with around 10 employees, is already serving the life science, manufacturing, and telecom industries. In the life science industry, Mithra AI offers spend repositories via API connection or ERP extract on spreadsheets. This solves the problem faced by procurement teams lacking a holistic view of their data.

Mithra AI offers a singular view of data including a full spend portfolio across business units and geographies. For the telecom industry, it offers synergy finder as an AI tool where customers can upload and compare different spend profiles in cloud while also getting instant results based on an algorithm trained “to accelerate taxonomy merge and prescribe cost saving opportunities.”

It has also deployed AI-based prescriptive recommendations using an algorithm trained to learn and deploy their unique taxonomy across all spends. This tool for the manufacturing industry allows for suppliers to upload their spend when needed. “Business selects or defines customised KPI’s and Mithra AI will alert the team as any opportunity surfaces but also guiding the team through qualifying those opportunities toward realisation of benefits as the ultimate goal.”

With its tailored ML algorithms and unique product, Mithra AI is showing how AI can go beyond its traditional use case and transform the user experience. Its success could pave way for more AI startups building algorithms to help solve problems in the unconventional business vertical.

2048 1152 Editorial Staff
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