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Supply chain resilience isn’t a new problem for organizations, but it’s definitely getting more attention than ever right now. Disruptions have always lurked in the background, ready to pounce. Inconsistent suppliers, natural disasters, extreme weather events and geopolitical turmoil could all exact a toll on an otherwise smooth-running global supply network. The global pandemic threw the issue into overdrive, and now—six years later—the disruptions just won’t seem to quit.
For these and other reasons, companies are focusing harder than ever on building the kind of supply chains that can stand up to the opposing forces, meet them head-on and then recover from the impacts. That’s the fundamental definition of resilience, and it’s something that most organizations are striving for right now. So even if they can’t end a war, single-handedly open the Strait of Hormuz or keep an insolvent supplier afloat, they can at least make sure they’re not caught flat-footed when the next disruption hits.
KPMG’s new supply chain survey backs this up and reveals that the roughly 460 C-suite leaders who responded to it are very focused on staying resilient amid the persistent disruption.
“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, KPMG’s principal, supply chain and operations, said in a press release. “Today’s environment requires the right balance across all three to ensure a high-performing supply chain.”
Transformed Operating Models
According to the survey, nearly three-quarters of supply chain executives (73%) want to transform their operating model within the next one to three years. KPMG says the key driver behind that number is the “need to enhance agility and flexibility and increase resilience due to a fast-changing environment and persistent global disruptions.”
While risk management and resilience have long been core supply chain priorities, leaders are putting more weight behind them. 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,” the company adds, “with most companies now spending 11-15% of their revenue on supply chain, up from 5-10% in 2024.”
Other Key Findings
The State of Next-Gen Supply Chain: A Leadership Survey also found that:
- Risk management leads transformation objectives, with 51% of respondents identifying it as a top priority over the next one to three years.
- 77% of respondents agree there is a talent gap in their organization’s procurement and supply chain function.
- Logistics and transportation costs represent the greatest source of value leakage, cited by 38% of respondents, with inefficient sourcing/suboptimal supplier terms following closely behind at 34%.
- 43% of organizations have successfully implemented AI in one or more areas of supply chain and 23% actively scaled AI capabilities across the function.
- Digital technologies are the top investment priority for improving Tier 1 and Tier N supply chain visibility over the next one to three years (50%), followed closely by strengthening supplier relationships (47%).
- Supply chain visibility (44%) and inventory management (42%) top the list of planned near-term system and technology investments over the next one to three years.
Even as organizations invest in digitalization and AI, KPMG says many of them are dealing with “persistent barriers to implementation including technological compatibility, data security and organizational resistance.” However, it also says organizations are proactively addressing these challenges by upgrading or replacing enterprise resource planning (ERP) systems for better integration (30%); investing in employee training and development (28%); and enhancing data management capabilities (28%).
