Supply chain executives focus on sustainability, AI

New data provides insight into where companies are investing rapidly increasing levels of supply chain funding.

The 2024 Supply Chain Executive survey from Blue Yonder, which polled global supply chain executives (including U.S.) on their experiences with supply chain and logistics strategy and operations over the last year, indicates that nearly eight out of 10 (79%) respondents increased their investments in supply chain operations, and only 4% reduced investments. 

In the U.S., 49% of respondents invested more than $10 million in supply chains, up sharply from 38% in 2023 and 24% in 2022. For 48% of all respondents, sustainability is the key area of investment, followed by AI-based technology (41%), developing new strategy (40%), additional workforce (39%) and digital transformation (37%).

The U.S. leads global sustainability investment, with 55% (up from 42% in 2023 and 43% in 2022) of U.S. respondents focused on improving efforts in that area. This is compared to only 27% for U.K. respondents.

Specific supply chain sustainability areas where U.S. respondents are allocating funds include improving transportation efficiency (59%), reducing waste and excess (57%), and improving supplier sustainability and reporting (53%).

Meanwhile, more than half of all respondents are applying AI to supply chain planning (56%), transportation (53%), and order management (50%). Eight in 10 global respondents have implemented generative AI technology in their supply chains at some level, whether fully (12%), partially (33%) or piloted (35%). 

In a promising sign for generative AI as a supply chain solution, 91% of global respondents said they find generative AI to be effective in optimizing supply chain processes and decision-making.

Supply chain investments and efficiency

In the U.S., 61% of organizations reported improved efficiencies because of supply chain investments, compared to 54% in 2023. Supply chain investments are also driving expanded market share in the U.S. (39% in 2024, 21% in 2023), increased revenue growth (38% in 2024, 39% in 2023) and fewer disruptions (41% in 2024, 42% in 2023).

Other findings

• A substantial majority (84%) of global respondents report experiencing supply chain disruptions within the last year. In the U.S., that number was 85%, down slightly from 87% in 2023 and 88% in 2022.
• Over the last year, global supply chain disruptions were driven primarily by the lack of availability of raw materials (48%), extended delivery times from material suppliers (47%), lack of labor (44%) and lack of availability on shipping vessels (41%). 
• Globally, the most common results of supply chain disruptions are delays for customers (42%), stalled production (42%), and loss of compliance with new regulations (39%). Within the U.S., more than four-in-10 (43%) respondents reported that supply chain disruptions resulted in delays for their customers, down from 52% in 2023 and 58% in 2022.
• More than one-third (36%) of U.S. respondents cited cost of materials as the area most impacted by inflation (down from 43% in 2023). On a global scale, respondents reported transportation (38%) and cost of materials (34%) as the business areas most impacted by inflation.
• Six-in-10 U.S. respondents reported decreased profit margins over the last year, the highest percentage of any of the regions surveyed. Globally, 46% of respondents’ profit margins fell amid rising costs.

Blue Yonder’s 2024 Supply Chain Executive Survey was fielded by a third-party provider and conducted from March 1-15, 2024. Responses were collected from more than 600 c-suite and senior executives across manufacturing, retail, third-party logistics and government, with responsibility for supply chain strategy, planning, logistics and manufacturing operations in the U.S., U.K., DACH (Germany, Austria and Switzerland), and France/Benelux (Belgium, the Netherlands, and Luxembourg).