Risk management and resilience have long been core supply chain priorities, but a KPMG study shows that leaders are now elevating them with new intensity.
In the survey, executives cited “managing and mitigating risks” as the most important transformation objective (51%) and top area for investment (39%) in the near future. This commitment is further evidenced by rising budgets, with most companies now spending 11-15% of their revenue on supply chain, up from 5-10% in 2024.
And the trend is widespread, as nearly three-quarters of supply chain executives (73%) are planning to transform their operating model within the next one to three years. According to researchers, the urgency comes from a fast-changing environment and persistent global disruptions.
The KPMG U.S. Supply Chain Survey, which polled 462 senior executives, also found that 77% of leaders agree there is a significant talent shortage in their procurement and supply chain functions. This deficit is seen as a major impediment to operational excellence, with logistics and transportation costs as the greatest source of value leakage (38%). The talent shortage impacts everything from supply chain visibility (38%) to demand planning (36%).
To combat this, 50% of organizations plan to invest in automation, digitalization, and AI. Slowing that process, many report persistent barriers to implementation. So they’re following strategies to overcome those hurdles, including: upgrading or replacing Enterprise Resource Planning systems for better integration (30%), investing in employee training and development (28%), and enhancing data management capabilities (28%).
“Today, building a resilient, agile, and digitally-enabled supply chain is a business imperative essential for survival and growth. Leaders are no longer only asking, ‘How can we make it cheaper?’ They’re asking, ‘How can we make it stronger, smarter, and safer?” Chris McCarney, Principal, Supply Chain and Operations at KPMG, said in a release. “Today’s environment requires the right balance across all three to ensure a high-performing supply chain.”
