Gartner Report: 71% of Supply Chains Are Unprepared for Future Challenges
Without a clear strategic vision, companies face uncertainty, while those with a strong plan will stay ahead.
A Gartner survey found that only 29% of supply chain organizations have built the critical capabilities needed to tackle future challenges. The research emphasizes that companies taking a long-term, strategic approach are better equipped for success, unlike those relying on short-term solutions.
Between July and October 2024, Gartner surveyed 579 supply chain professionals across various industries. The study identified five key traits essential for maintaining a competitive edge: agility, resilience, regionalization, integrated ecosystems, and an enterprise-wide strategy. Organizations that demonstrated at least three of these traits were classified as industry leaders.
“Leaders shared a commitment to preparation through long-term, deliberate strategies, while non-leaders were more often focused on short-term priorities,” said Pierfrancesco Manenti, VP Analyst at Gartner.
“Most leaders have yet to invest in the most advanced technologies (e.g., real-time visibility, digital supply chain twin) but plan to do so in the next three to five years,” Manenti said. “Leaders see technology as an enabler to their overall business strategies, while non-leaders more often invest in technology first, without having fully established their foundational capabilities.”
The Gartner survey examined how organizations are preparing to tackle future challenges while keeping their supply chains competitive. It assessed the strategies, investments, and capabilities businesses are developing to adapt to an evolving landscape. As part of the study, respondents identified key factors expected to shape supply chain performance over the next three to five years. These include advancements in AI, the growing number of ESG regulations and trade policies, geopolitical shifts and power transitions, data control, talent shortages, and climate change, among others. The findings offer valuable insights into how industry leaders are positioning themselves for long-term success compared to those focused on short-term solutions.
The survey also identified four distinct supply chain strategies that companies are implementing to prepare for the future:
Design: Emphasizes innovative business models to minimize complexity, focusing on standardized product designs that can be adapted across variations. Companies align operations with customer and product segmentation to enhance efficiency and ensure long-term success.
Durability: Prioritizes sustainability and risk management to enhance long-term resilience. Organizations emphasize transparent sourcing and environmentally responsible practices to strengthen supply chain stability.
Deferment: Takes a cautious approach by strategically delaying investments while focusing on operational efficiency and cost management to maintain stability in uncertain conditions.
Decision: Leverages technology and skilled talent to navigate complexity, utilizing AI, machine learning, and real-time analytics. Companies prioritize scenario planning and real-time visibility while fostering a dynamic work culture that supports innovation and growth.
“While CSCOs can be successfully aligned to any of the four profiles, the data suggests following the Design profile. Its emphasis on business model innovation capabilities could be the most fruitful, as there are more leaders aligned with the Design profile compared to the others,” noted Manenti. “Critically important is a commitment to making very focused investments aligned to their profile, something the leading organizations share.” He said.
