Agentic AI Supporting Procurement in Public Organizations

This chapter presents a comprehensive technological architecture and a standard functional framework for using agent-based AI (AAI) in public procurement systems. Autonomous AI in public procurement, capable of environmental recognition, decision-making, and goal-oriented actions, offers numerous opportunities and challenges. This framework was developed to address public procurement needs, such as ensuring fairness, transparency, and accountability to taxpayers. It uses real-world data to create a multi-layered strategy incorporating strategic governance, technological design, human-AI cooperation models, and process automation. These forms of collaboration are essential to ensure AAI works with decision-makers and provides them with the information and expertise needed to make informed choices. The approach demonstrates the application of AAI at various stages of the procurement process, including criteria establishment, market analysis, contract management, and partner performance monitoring. In addition to explaining key human oversight and intervention methods, this chapter discusses use cases such as dynamic partner qualification, autonomous market research, intelligent bid analysis, and proactive contract management. The framework also addresses critical considerations for implementation, such as liability rules, data management, explainability, and necessary regulatory adjustments. This chapter shows that a well-implemented AAI can transform government procurement by eliminating human bias, simplifying processes, accelerating timelines, determining value, and providing small businesses better access to government contracts. This framework offers policymakers and procurement officials clear steps to implement AAI while preserving essential public sector values. The technical architecture enables the practical application of the framework.