CIPS Global State of Procurement and Supply 2024: Shaping the Future of Procurement
The Chartered Institute of Procurement & Supply (CIPS) has unveiled its 2024 Global State of Procurement and Supply report, a deep dive into the evolving procurement landscape. This comprehensive study, conducted in collaboration with GEP, encapsulates the insights of top procurement professionals from 122 organizations, amassing a collective turnover of $73 billion.
Key Insights:
- Sustainability and Ethical Sourcing:
- 69% of organizations plan to invest in sustainability measures.
- 77% have established ethical sourcing policies.
- Sustainability in procurement is crucial for influencing Environmental, Social, and Governance (ESG) outcomes. However, skill development in managing sustainability remains a challenge.
- Rising Influence of Procurement:
- 68% of respondents report an increased influence of procurement within their organizations.
- Procurement and supply functions manage or influence 60% of spend on direct goods despite 51% of teams having fewer than 20 members.
- Technological Advancements:
- Digital technology investment is a priority, with 65% of organizations focusing on this in the next 12 months.
- Automation is on the rise, with 2% of procurement functions fully automated and 27% partially automated. Nevertheless, the human element remains vital for procurement success.
- Supply Chain Continuity Amid Geopolitical Concerns:
- 69% of procurement leaders are concerned about geopolitical factors causing supply chain disruptions.
- Strategies such as diversifying suppliers, insourcing critical components, and holding more stock are essential to managing volatility and ensuring supply chain continuity.
Technological advancements in procurement
Future Investment Areas:
- Sustainability (69%)
- Digital Technology (65%)
- Staff Development and Training (60%)
- Strategic Sourcing (39%)
- Supply Chain Visibility (39%)
Technological Impact
While AI and automation are pivotal, the report emphasizes that human relationships in procurement remain critical. Investment in digital technology will continue to be a major focus, aiming to enhance procurement efficiency and supply chain management.
Supply Chain Strategies:
To counter potential disruptions, procurement leaders are leveraging data and technology to monitor and predict supply chain issues. They are also adopting strategies like diversifying suppliers and increasing stock to ensure supply continuity.
The CIPS Global State of Procurement and Supply 2024 report offers valuable insights for procurement professionals, helping them navigate current challenges and capitalize on future opportunities. The focus on sustainability, technological advancements, and strategic sourcing will drive the procurement function forward, reinforcing its pivotal role in organizational success.
