According to precedence research, the global supply chain management market size will account for USD 31.4 billion in 2024 and is projected to hit around USD 72.1 billion by 2032. With the anticipated growth in global supply chain, the complexities and challenges will also increase. Procurement professionals need to be ready and anticipate emerging trends in Procurement beyond 2024.

“The challenge for companies will be to make their supply chains more resilient without weakening their competitiveness. To meet that challenge, managers should first understand their vulnerabilities….” Willy C. Shih, 2020, Global Supply Chains in a Post-Pandemic World HBR.

According to a Gartner survey, AI will play a pivotal role in 50% of organisations’ supplier contract negotiations by 2027. GenAI solutions are expected to enhance procurement efficiency and productivity, empowering professionals with data- driven insights. Gartner recommends steps for leveraging AI in contract management, including transitioning to contract lifecycle management solutions and quantifying contract risks.

Notable trends in supply chain that organizations will encounter in 2024 include the following.

1] Resilience and Agility.

Key characteristics of Agile supply chains are flexibility and resiliency. Strong successful relationships with stakeholders throughout the supply chain is vital to creating agility and respond rapidly to unexpected changes. Resilient and agile supply chains are data driven with efficient processes to inform decisions on forecasting demand, harness opportunities and manage risks.

Organizations can gain competitive advantage over their competitors by shaping a supply chain resilience strategy focused on disruption avoidance and being better placed to manage and take advantage of disruptions. Concurrent application of agile and resilient concepts in the Supply Chain will ultimately improve performance and competitiveness.

2] Use of Conversational AI and Generative AI

“Supply chains of the future will be steered by human creativity but powered by AI and intelligent technologies.” [Subit Mathew, Deloitte].

Subit also believes that companies need to segment their AI strategies into three different categories:

Improve efficiency to do the things it does today in a different, more accelerated fashion.

Improve the user experience to become more intuitive and provide contextual information.

Deliver new processes and innovation previously not had in the organization.

Recent findings from Research and Markets project that global AI adoption in procurement and supply chain management will hit $1.3 billion by 2024. 

According to SAP Business, with AI, you can predict events, make better informed decisions, and modernize functions from design to operate. 

 Predict customer demand reliably with AI-powered demand forecasting. 

 Improve quality with intelligent anomaly detection and visual inspections.

 Synchronize operations and maximize efficiency with predictive maintenance.

 At its Sapphire 2024 event, SAP announced a new generative AI feature which lets buyers bundle products and services into a single transaction. Users will provide a description  of their purchasing needs and the system will generate a recommended bundle of items and services ready for buying, saving users time searching catalogues for a specific item.

3] Supply Chain Risk Management

Managing risks in the Supply Chain requires a proactive approach encompassing real-time monitoring that is data driven to spot potential disruptions and manage any identified potential risk swiftly.

According to McKinsey, “The challenge of supply-chain risk management has been exacerbated by globalization, where even sensitive products like defense systems use raw materials, circuit boards, and related components that may have originated in countries where the system manufacturer did not even know it had a supply chain. This increased complexity has brought with it more potential failure points and higher levels of risk.”

To effectively mitigate supply chain risk, Supply Chain professionals need to have knowledge of the exposure risk levels and the effectiveness of the measures that have been put in place to manage the risks that may impact the business. There should also be a coordinated effort between multiple stakeholders in the business, including supply chain and procurement personnel, legal, compliance, and finance.

4] Diversity and Inclusivity: A Catalyst for Success

In the quest for excellence, diversity and inclusivity emerge as non-negotiable pillars in the procurement process. As we step into 2024, organizations are recognizing the transformative power of diverse perspectives and inclusive practices. The ability to harness a spectrum of experiences and ideas not only fosters innovation but also ensures that procurement strategies resonate with a global and varied audience. It is not merely about meeting quotas but about creating a rich tapestry that fuels creativity and success.

5] Supplier Relationship Management

A 2023 PWC survey found that 43% of CEOS viewed Supply Chain disruption as an important factor in impacting profitability in the industry over the next decade. With this in mind, the importance of SRM in fostering transparent and collaborative relationships to proactively manage disruptions and minimize potential risks gains significant strategic importance. And Deloitte’s 2023 CPO Survey reported that “61% of CPOs said that increasing their level of supplier collaboration was their top strategy to deliver the most value.”

Some of the benefits of Supplier Relationship Management include:

- Reduced Cost

- Increased Quality

- Improved Staff Morale and Productivity

- Increased Compliance

- Reduced Risk

- Improved Service Levels

- Achieved Innovation Goals

- Increased Profitability

6] Cybersecurity

“With great technological innovation comes great exposure to cyber risk.”

Embracing and implementing a robust procurement system comes with new and emerging challenges. According to BCI’s Supply Chain Resilience Survey, “Cyber security and data breaches are the top threat to supply chains over the next 12 months and the next five years.” In 2023, Cybersecurity Ventures reported that “cybercrime is projected to cost $10.5 trillion in damages by 2025.”

“In the past ten years, hundreds of cyber attacks have been carried out on firms through their supply chains. The most well-known such attack was the breach of the US retailer Target through their regional heating, ventilation, and air conditioning supplier, Fazio Mechanical, in 2013. By breaching a modest firm with little to no resources devoted to their security, attackers were able to steal 110 million records worth approximately $190 million from a large multinational retailer. Target’s front door was strong, but the same could not be said of all the vendors who had a key to it. Similar attacks have been carried out against many large firms operating in multiple industries. A snapshot of some of the most significant attacks is presented here.”

Rogers, Zachary S., 'Supply Chain Cybersecurity: Procurement’s Role in Securing the Network', in Thomas Y. Choi, and others (eds), The Oxford Handbook of Supply Chain Management (2021; online edn, Oxford Academic, 6 Aug. 2020), https://doi.org/10.1093/oxfordhb/9780190066727.013.9, accessed 22 Aug. 2024