Pressure continues to be felt from all branches of the supply chain.
With rising costs and ongoing supply chain disruption, how are procurement teams navigating and mitigating risk?
Keelvar’s latest Voices of Sourcing report breaks down how procurement and sourcing professionals are battling supply chain disruption and market volatility. Then, critically, it predicts how their most recent experiences are set to shape the next 12 months.
Over recent years, sourcing teams have experienced exceptionally high unpredictability, including:
- 91% state that inflation has impacted their supply chain costs
- 44% say they have experienced a significant operational impact from both the semiconductor shortage and from Russia’s invasion of Ukraine
- 65% experienced severe supply chain disruption due to COVID
- 58% said their supply chain operations were impacted by inflation and recession
How are procurement professionals mitigating risk?
To manage the ongoing impact of geopolitical, social and global factors, teams are seeking to improve supplier diversity – by up to 52% (from 25% the previous year). Additionally, 49% are looking to nearshore suppliers, in a bid to lower costs and reduce carbon emissions.
What’s next for sourcing?
Costs have increased, with 25% of respondents admitting that they don’t see them coming back down for the foreseeable, and most sourcing leaders putting pressure on suppliers to cut costs. So, sourcing teams will continue to make more competitive deals.
Priorities are shifting too, with overcoming supply chain disruption listed as the most important (at 83%), alongside combatting inflation (78%) and scaling productivity with limited resources (57%).
Further priorities ripple into digital. Professionals want to target:
- Tactical spend – 52%
- Category planning – 46%
- Strategic sourcing, spend analytics and supplier relationships – 39%
- Savings tracking – 37%
‘Sourcing professionals will embrace automation’ Keelvar
What to expect from sourcing in 2023 and beyond
Predicting disruption can never be certain, but there are a growing number of tools that continue to find ways to help companies minimise its impact. According to Keelvar, procurement professionals will embrace digitalisation and autonomous sourcing technologies, to reap the benefits of reduced time spent on manual tasks; gain extra time for more strategic initiatives; and enable smarter decisions that take more factors into account.
- Embrace automation
- Use digital tools to better foresee (and so minimise) the impact of supply chain disruption
- Be tactical – which tools do you want to invest in? Balance cost with ROI