The end of SaaS?

The increased applications of AI (as generative AI, AI agents, AI-powered copilots, etc.) has led to speculation about the future of SaaS and whether AI itself can more efficiently carry out tasks that are currently SaaS-based. Whether via process-agnostic AI agents or tailored, industry-specific methods, there is certainly potential to 

automate many currently manual tasks. Of course, this debate has massive procurement implications.

Procurement is no stranger to these types of conversations. For example, there is another ongoing industry discussion as to whether intake and orchestration software can eventually replace the source-to-pay (S2P) technology on which it currently relies for its own value proposition. In both cases, the hype only continues to build. 

Call me a buzzkill, but the emergence of new or innovative technology does not always need to result in immediate conversations about the total replacement of the status quo. Yes, AI can help (and already is helping) organizations to automate mundane, time-consuming tasks. But in order for it to “kill SaaS,” it would need to include a bevy of features backed by technological functionalities that do not currently exist (and may not be achievable, such as the ability for AI to generate truly original ideas). This is without even entertaining those who are already making near-term arrangements for a SaaS funeral.

The long-term answer may be to integrate more AI-powered capabilities into vertical SaaS tools. Many procurement software providers are already doing this. But while certain procurement tasks, such as guided buying and contract negotiations, can be automated to fairly high degrees, it is very difficult to see completely touchless, agent-driven processes for many S2P processes.

I’m going to save this so I can look back on it in five to ten years. For all I know, I’ll be laughing at how wrong I was!

— Nikhil Gaur, Director of Strategic Projects and Research Analyst