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Yash Yeola, a Consultant at Butterfly Data, has developed the Company Analysis Tool (CAT), a Generative AI-powered solution designed to enhance risk assessment in public procurement.
Artificial Intelligence is revolutionising public sector procurement, enhancing efficiency, transparency, and accountability. A new whitepaper, Risk Identification in Public Contracts: The Role of Generative AI and the Company Analysis Tool (CAT), highlights how AI can empower procurement professionals to make more informed decisions and safeguard public funds.
Developed by Butterfly Data in collaboration with Oxford Insights, the report introduces the Company Analysis Tool (CAT), an AI-driven solution designed to strengthen due diligence. By leveraging Generative AI and Large Language Models (LLM), CAT quickly detects red flags in awarded contracts, helping procurement teams proactively manage risks.
AI: A new standard for public procurement
With the UK government committed to tackling inefficiencies and ensuring integrity in procurement, AI presents a transformative solution. Globally, AI-driven tools such as Brazil’s ALICE and the EU’s DATACROS II have already demonstrated success in identifying financial risks. CAT is tailored to provide similar benefits to the UK’s public sector, equipping procurement professionals with advanced tools to enhance transparency and oversight.
Oxford Insights’ Research Lead, André Petheram, emphasises the tool’s significance: “Procurement oversight in the UK struggles to keep pace with the complexity and volume of government contracts, leaving room for inefficiencies and possible corruption.”
“We saw an opportunity to leverage AI to help procurement teams cut through vast amounts of data and highlight potential red flags quickly and effectively. That’s why we worked with Butterfly Data to develop the CAT, carefully designed to meet the real-world needs of public sector decision-makers.”
How CAT works
CAT integrates AI-driven analytics to assess supplier risk profiles using data from sources like Companies House, Contracts Finder, Wikipedia, and media outlets. It identifies key risk indicators, including undisclosed contract awards, limited competition procurement procedures, newly registered entities, and adverse financial or media coverage.
Yash Yeola, Developer of CAT and Consultant at Butterfly Data, explains: “The CAT is a powerful AI tool that streamlines the process of identifying high-risk companies in public procurement. By leveraging Large Language Model (LLM) technology, it synthesises insights from structured and unstructured data sources, flagging companies based on key risk indicators.”
“These indicators include late or undisclosed contract awards, limited competition procurement procedures, newly registered or short-lived companies, and negative media coverage or financial irregularities. By ranking based on an entity’s risk profile, the CAT enables procurement teams to focus their due diligence efforts where they are most needed.”
A collaborative future
Designed for adaptability, CAT can be implemented across government departments and regulatory bodies, supporting organisations such as the Department for Work and Pensions (DWP), HMRC, and the Public Sector Fraud Authority.
Butterfly Data and Oxford Insights invite procurement professionals, government agencies, and civil society organisations to collaborate in refining CAT’s capabilities. By engaging in further testing and feedback, stakeholders can contribute to the development of a robust AI-powered procurement ecosystem.
For those interested in exploring CAT’s potential, the full whitepaper offers an in-depth look at AI’s role in modernising procurement.
More Information:
To access the whitepaper, visit: www.butterflydata.co.uk/blog