Welcome to the May 2026 edition of Gordon’s Window with Gordon Donovan. This is your comprehensive guide to the latest shifts and challenges in global procurement and supply chain management. Save your own time reading research when you can get the key takeaways in one place!
A couple of themes have emerged from this month’s research:
AI and automation are shifting effort away from transactional work towards category strategy, supplier collaboration and disruption response, but only where data quality and operating models keep up.
The organisations that grow fastest use procurement as a growth engine, not just a savings function, and they track ROI, influence and skills accordingly.
Cost and risk are not separate agendas; they are a singular conversation.
Cost pressure is structural, not cyclical, with energy, freight, labour and tariffs combining to push total supply chain costs 5-7 percent above inflation through 2026, leaving many businesses facing more than 10 percent total cost exposure.
At the same time, survey data from CIPS, QIMA, Hackett, CIO reports and Gartner all tell the same story: you are moving from visibility to execution, from pilots to practical AI.
Gartner now expects 60 percent of supply chain disruptions to be resolved without human intervention by 2031, which will only work if procurement, IT and commercial teams fix data foundations, governance and operating models first.
Kearney: Supply Chain Navigator
Kearney’s Supply Chain Navigator suggests supply chain unit costs will rise 5-7 percent above inflation through the end of 2026, driven by Middle East energy disruption and shifts in US tariff policy.
Disruption in the Strait of Hormuz is feeding through into fuel, petrochemicals, fertilisers and metals, raising many input categories by 10-25 percent and hitting supply tiers that many procurement teams do not see directly.
Shipping lanes are rerouting around the Cape of Good Hope, adding 10-14 days to voyages and pushing freight rates 30-70 percent higher on affected routes, with full normalisation expected to take six to twelve months after de‑escalation.
Tariff policy compounds the story. The key point is timing. The report shows cost shocks front‑loaded into the next two quarters; companies with thin inventory or short contracts feel the impact first.
Leaders are mapping exposure to tariffs and Middle East routes, securing capacity and building scenarios‑based planning and dual‑sourcing, while laggards wait for the bill to arrive.
CIPS/GEP: Global State of Procurement and Supply 2026
The CIPS/GEP survey paints a picture of a profession with greater influence and higher expectations.
Around 77 percent of functions operate in a centre‑led model, and a growing share of procurement leaders report directly to the CEO or executive committee, with finance now the minority reporting line.
Teams manage a large share of spend, with two‑thirds responsible for at least 60 percent of direct goods and almost a third managing over 90 percent.
Investment priorities centre on digital technology, staff development and AI, although AI expectations have become more cautious, with fewer respondents expecting dramatic productivity gains in the next two years.
Skills data shows demand for new technology skills, risk management and negotiation at the top of development priorities, while interest in leadership and influencing has dipped, especially in larger organisations.
Cybersecurity is another fast‑rising theme, with two‑thirds of organisations updating procurement policies in response to cyber risk and almost 30 percent reporting a cyberattack in the past 12 months.
QIMA: Global Sourcing Survey 2026
QIMA’s survey of more than 1,000 companies shows that after a decade of disruption, supply chains are better prepared, but 2026 still looks tough.
Around four in five businesses expect costs to be a major disruption, with the disruptive potential of cost factors almost doubling since 2024. Raw materials and shipping lead, with labour costs close behind.
Tariffs hit US and China‑based supply chains hardest in 2025, with many shifting production to Vietnam, India or Mexico rather than reshoring.
Diversification, visibility and digitisation stand out as the three main response levers.
About 43 percent of supply chains changed sourcing geography in 2025, and diversified supply chains were more likely to grow volumes than those that stood still.
The average company now knows about 60 percent of its suppliers by name and country, but fewer than one in five has full visibility. The more mapped the network, the fewer issues with quality, compliance, capacity and schedule.
Digitisation continues in a selective, budget‑conscious way, with three‑quarters of respondents planning further investment and clear benefits in communication, traceability and safety compliance for those with higher digital maturity.
Gartner: Autonomous Supply Chains and Disruption Resolution
Gartner forecasts that by 2031, 60 percent of supply chain disruptions will be resolved without human intervention, as AI tools sense, decide and act across supply networks.
Drivers include geopolitical shocks, tariff churn and increasing frequency of events that outstrip human monitoring capacity.
The projection assumes widespread deployment of agentic AI in control towers, planning, logistics and sourcing, tied deeply into transactional systems and risk data.
Foundry: State of the CIO
The CIO report points to a sharp focus on AI, cybersecurity and data platforms, with many CIOs reallocating budget toward AI agents, automation and unified data architectures that support cross‑functional use cases, including procurement and supply chain.
Business and IT leaders increasingly expect procurement to plug into the same digital backbone as sales, marketing and operations, not run separate tools and data stores.
Procure AI: AI in Procurement
The whitepaper states that the value of AI in procurement is constrained more by fragmented data than by algorithms.
It recommends a practical data strategy that consolidates spend, contract, supplier and risk data, defines clear ownership and governance, and establishes reliable pipelines into AI tools.
The message here is simple: if you want autonomous sourcing, disruption resolution and better commercial insight, you need to fund data engineering and governance with the same seriousness as category strategies or sourcing events.
Economist Enterprise: Procurement at a Crossroads
Procurement is navigating a sharp return to basics, but with a heavier burden than before.
Based on a global survey of 2,648 C-suite executives across 23 countries, the report finds that cost control has re-emerged as the primary measure of procurement’s value, cited by 54 percent of executives (up from 43 percent in 2025), with CPOs and CSCOs rating it even higher at 58-59 percent.
Yet the function is simultaneously expected to deliver on the expanded mandate it accumulated post-pandemic: risk management, supply chain resilience, ESG compliance and category management sophistication.
This dual pressure – reduce costs and manage complexity – is playing out against a backdrop of largely flat headcount and declining executive confidence in procurement’s effectiveness across almost every measured dimension.
Almost two-thirds (60 percent) of executives name digital transformation as their top priority (up from 38 percent in 2025) and 56 percent will specifically target agentic AI for implementation or evaluation in the next 18 months.
Yet the reality of deployment remains modest, with only 23 percent of companies scaling agentic AI solutions.
The biggest barrier is not technology itself but the foundations around it: fragmented data, poor systems integration (only 18 percent of leaders say their tech stack is fully integrated) and unclear ROI.
Critically, 56 percent of executives report no improvement in decision-making through AI over the past 18 months, and just 9 percent want AI to lead most procurement decisions within three years – signalling that the human-AI balance firmly favours humans, with AI earning its keep in process automation and analytical support rather than strategic autonomy.
Procurement’s boardroom influence – so hard-won during the pandemic years – is visibly receding.
Confidence in procurement’s contribution to corporate strategy fell from 90 percent to 74 percent year-on-year, and CPO influence over digital transformation strategy dropped from 91 percent to 68 percent.
The report’s central message is clear: procurement leaders must now prove their value not by arguing for a broader mandate, but by delivering consistently across it, demonstrating measurable outcomes at a moment when scrutiny of returns has never been higher.
As always, reach out to discuss more. I’m always happy to hear your thoughts!
