GEP Outlook 2025 – Key Trends in Procurement and Supply Chain

GEP’s 2025 Outlook report highlights the major forces reshaping procurement and supply chain management. Focused on AI, resilience, and strategic agility, it offers valuable guidance for manufacturers and distributors preparing for a more complex, fast-changing global environment.

Here’s a brief look at the major trends and insights from the report:

Six Major Trends in Procurement and Supply Chain Management

1. AI and the Next Evolution of Procurement

AI will move from task automation to autonomous decision-making — progressing from Assist to Perform to Empower. Organizations that invest in the right tools, data infrastructure, and talent will outpace competitors, replacing traditional models with faster, smarter, and more agile procurement systems.

2. AI-Powered Procurement Orchestration

AI-driven platforms can now automate everyday tasks like placing orders, matching invoices, and managing contracts. This reduces manual effort and frees up procurement teams to focus on supplier innovation and risk management.

3. AI Agents in Procurement

AI agents are practical tools for handling complex tasks such as demand forecasting and risk monitoring. Companies that start with pilot projects and high-quality data systems can quickly build stronger, more adaptive operations — securing a clear competitive edge.

4. Evolving Value Metrics

Procurement success will no longer be measured only by cost savings. New metrics — resilience, sustainability, regulatory compliance — will define value. In 2025, leaders will win by building supply chains that can adapt, endure, and grow in a fast-changing world.

5. Supply Chain Resilience and Regulatory Demands

With rising regulatory pressure, manufacturers and distributors must move from reactive compliance to proactive management. Focusing on transparency, continuous compliance, supplier accountability, and stronger networks will be critical to staying ahead.

6. Globalization vs. Localization

Friendshoring and nearshoring are gaining momentum as protectionism rises. Success in 2025 will require companies to rethink strategies — updating total cost calculations for long-term risks, building strong partnerships, and adapting quickly to trade barriers.

Key AI Applications in 2025

AI agents and orchestration tools will be leveraged across several areas:

• Routine Task Automation: Purchase orders, invoice matching, contract management.
• Risk Monitoring: Predicting disruptions from geopolitical and weather events.
• Demand Forecasting: Analyzing market data for smarter sourcing and production plans.
• Incremental Sourcing: Negotiating and adjusting supplier strategies dynamically.
• Supplier Relationship Management: Tracking performance, compliance, and improvements.
• Supply Flow Optimization: Managing material movement from source to delivery.
• Self-Service Procurement: Enabling employees to navigate sourcing decisions with AI guidance.

Shifting Success Metrics

AI tools will unlock deeper insights into:

• Supplier performance
• Cost optimization
• Risk management
• Sustainability outcomes (e.g., greenhouse gas reductions)

Procurement success metrics will expand to include agility, resilience, and the share of automated “touchless” transactions.

Challenges and Critical Requirements

To fully realize the benefits of AI and next-generation supply chains, organizations must:

• Adopt a clear AI vision and strategy aligned across leadership teams.
• Invest in robust data management, ensuring clean, accessible, governed data.
• Build new capabilities, upskilling teams in digital literacy and AI fluency.
• Implement change management programs to guide adoption.
• Start with pilot projects to test effectiveness and build momentum.
• Establish cross-functional governance teams for oversight and integration.

If you’re looking to sharpen your procurement and supply chain strategies for the complexities of 2025, the “GEP Outlook 2025” report offers valuable perspectives and is a highly recommended read. You can explore more insights at www.geo.com.

You can download the full report here.