Gartner: ‘Only 29% of supply chain organisations ready for the future’

Only 29 per cent of supply chain organisations currently have those competitive characteristics that determine their future readiness. This is according to new research from analyst firm Gartner. The implementation of artificial intelligence (AI) and navigation through new trade policies are considered to be the most important future factors affecting supply chains.

The Gartner survey focused on how ready companies are for the future and how they keep their supply chains competitive. To do so, Gartner surveyed 579 Chief Supply Chain Officers (CSCOs) worldwide. The analyst firm identified the following five competitive characteristics, among others: agility, resilience, regionalisation, integrated ecosystems and integrated business strategy.

The leading companies among the respondents were found to be those supply chain organisations that already developed at least three of the five competitive characteristics required for a ‘ready for the future’ qualification. ‘The leading companies have in common that they are preparing through well-considered long-term strategies, while non-leaders are more often focused on short-term priorities,’ said Gartner’s VP Analyst Pierfrancesco Manenti.

‘Most CSCOs have not yet invested in cutting-edge technologies, such as real-time visibility and digital supply chain twins, but plan to do so in the next three to five years,’ said Manenti. ‘Leading companies see technology as a tool to support their overall business strategies, while non-leaders are more often already investing in technology without having their basic capabilities fully in place.’

Four profiles

Respondents were also asked to identify the future drivers that will affect supply chain performance over the next three to five years (see figure below). From this, four unique profiles emerged, defined by what CSCOs consider to be the most crucial characteristics for strengthening the organisation. Each profile highlights capabilities such as business model innovation, sustainability, talent and technology that supports future readiness.

For instance, there is the Design profile that emphasises business model innovation to reduce complexity. This focuses on product designs that can also be used for variants of those products. Companies in this profile prioritise simplification, standardisation and differentiation based on customer and product segmentation in order to streamline operations and increase future success.

The Durability profile sees sustainability and risk management as essential for long-term viability, focusing on sustainable sourcing and transparency in initiatives. By minimising environmental impact, these companies build resilient supply chains that can withstand uncertainties and contribute positively to their ecosystem.

The Deferment profile takes a more cautious approach with strategic breaks in investments. The focus here is mainly on operational excellence and cost control. Companies are ‘fast followers’ and observe others first before investing themselves. Something common in industries where regulatory pressure and lower risk appetite influence strategies.

Finally, the Decision profile uses technology and talent to manage complexity, with an emphasis on AI, machine learning and real-time data analytics. Companies in this profile prioritise scenario planning and real-time visibility. They also encourage a culture where employees thrive in dynamic environments and support growth through innovation.

Business model innovation

‘Although CSCOs can be successful in any of the four profiles, the data suggest following the Design profile. Highlighting innovation capabilities in business models may well be the most fruitful option, as there are more leaders focusing on the Design profile than on the other profiles,’ said Manenti. ‘Crucial to this is the commitment to make highly targeted investments aligned with their profile, a commitment shared by the leading organisations.’