A joint survey by the Institute for Supply Management (ISM) and Amazon Business shows 71% of organizations now prioritize cost-risk balance in procurement strategy — yet only 45% feel prepared for supply chain disruptions. Of 425 global supply chain professionals surveyed, 65% still use manual reporting, and just 46% employ scenario planning. Advanced risk tools like risk matrices (49%) and predictive analytics remain underused. The research advocates a 'total cost of ownership' operating model centered on diversification, visibility, faster decisions, and expanded scenario planning.
According to www.thescxchange.com, a joint survey by the Institute for Supply Management (ISM) and Amazon Business reveals a critical disconnect between strategic intent and operational capability in global supply chains.
Strategic Intent vs. Operational Reality
While 71% of organizations report that balancing cost efficiency and supply chain risk now drives their procurement strategy, only 45% say they are prepared to manage supply chain disruptions. The gap persists amid ongoing geopolitical, economic, and operational volatility. The findings come from a survey of 425 global supply chain professionals and are detailed in the white paper “Balancing Cost and Risk: An Operating Model for Supply Chains.”
Further underscoring the execution shortfall, 65% of respondents still rely on manual reporting to gather supply chain data — a practice incompatible with real-time risk response. This statistic highlights a systemic lag in digitization and process maturity across procurement functions.
Technology Adoption Remains Uneven
The study identifies uneven adoption of procurement technologies as a key contributor to the capability gap. While 58% of organizations use e-procurement platforms and 51% deploy supplier portals, more advanced tools remain underutilized. Only 49% apply risk matrices, and just 46% conduct scenario planning — both foundational practices for proactive resilience building.
Business impact analysis is more widespread, used by 64% of respondents, yet its value is constrained without integration into dynamic decision workflows. The researchers note that predictive analytics and automated risk monitoring — capabilities increasingly adopted by top-tier logistics providers — appear in fewer than half of surveyed organizations’ toolkits.
An Emerging Operating Model
To close the gap, the research proposes an emerging supply chain operating model grounded in risk-adjusted decision-making. This model moves beyond price-centric procurement toward a broader “total cost of ownership” framework that explicitly incorporates service performance, process efficiency, and disruption exposure alongside unit cost.
This shift is supported by four concrete practices identified in the white paper:
- Diversifying supply sources
- Improving end-to-end visibility across supply networks
- Accelerating decision-making cycles
- Expanding scenario planning capabilities
These practices reflect industry-wide trends observed among leading adopters — including Amazon Business and major manufacturers scaling digital twin and AI-driven demand sensing — but remain aspirational for most midsize enterprises.
Leadership Perspective on Disruption as Default
Debbie Fogel-Monnissen, ISM Interim CEO, emphasized the urgency of bridging the strategy-execution divide:
“Organizations today are operating in an environment where disruption is no longer an exception. It is an ongoing reality.” — Debbie Fogel-Monnissen, ISM Interim CEO
She added that while leaders recognize the need to balance cost with resilience, many are still building the capabilities required to act on that insight. According to Fogel-Monnissen, closing this gap is essential not only for continuity but for protecting financial performance — a point reinforced by recent data showing 93% of manufacturers have deployed MES systems, yet only 23% have scaled them enterprise-wide.
Source: thescxchange.com
Compiled from international media by the SCI.AI editorial team.
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