The growing economic problems facing CPOs (Chief Procurement Officers) has been one of the most talked-about topics in the financial world. Since it is difficult to ascertain the major risks, Vechain partner and top accounting firm Deloitte undertook a survey among a number of respondents regarding the major issues facing CPOs.
The 2019 survey was conducted in association with reputable procurement market intelligence firms and involved 481 procurement executives from 35 countries representing organizations with a combined annual income of $5 trillion.
Deloitte released the result yesterday which showed an agreement by a cross-section of respondents regarding prospective risk factors for CPOs.
Economic Downturn Considered Major Risky Factor For CPOs
The number one factor cited by 46% of the respondents was an economic downturn. A majority of the respondents suggested that for effective management, cutting costs is an essential necessity to ensure long term success. Since there has been a growing instability in world economies due to the current situation between global powers.
The respondents believe that the current issues with Brexit and the volatility in emerging markets and the middle east also represent major issues for CPOs.
US, China Trade War Identified As Second Major Risk
The second major risk factor mentioned by 34% of the respondents was the ongoing trade war between the US and China. The two nations which are equally the largest economies in the world have been on a long drawn out trade war since the beginning of the year.
According to the respondents, CPOs have to watch against reactionary tendencies and ensure that they practice patience as these issues play out in the larger political landscape. Major business sections that deal with supply chains from these regions may have to look for alternative supply chains or plan for adjustment along the way.
Blockchain Technology Mentioned As A Major Factor For CPOs
The third most risk factor was Anticipating and capitalizing on Industry trends which the majority of the respondents emphasized about. The advent of digital platforms and solutions have placed more emphasis on CPOs to focus on analytics and how it impacts their business in the long run.
Blockchain technology and Artificial Intelligence (AI) were mentioned as two of the major technologies that can be capitalized on to improve businesses. It is also believed that Blockchain technology has not been fully utilized by CPOs.
It is no surprise that Deloitte has partnered with VeChain which is a major blockchain firm that provides supply management chain solutions as it seeks to harness the potentials of blockchain technology.