Procurement faces a defining moment. Cost control again sets the bar, yet teams are also expected to manage risk, diversify supply chains, build resilience and adopt AI.
The latest report from Economist Enterprise and supported by SAP Ariba shows how the function is balancing tighter cost demands with broader duties, even as executive confidence in its influence wanes.
“In its fifth year, our survey of global executives reveals that procurement continues to be a central source of intelligence within organizations, most often reporting to the chief operating officer (COO). Yet the past year also marks a shift. Business leaders report weaker alignment between procurement and wider corporate strategy and declining confidence in procurement teams’ effectiveness across several measures,” the report says.
Key takeaways:
- Cost has returned to the top of the agenda and may be there to stay. A majority of executives (58% of chief procurement officers and 59% of chief supply chain officers), say that it is the function’s primary contribution to their organization, more than 10 percentage points higher than in 2025. The inflationary impact of higher energy prices resulting from the Iran war will only add to these pressures in 2026.
- Executives also expect the procurement function to take a systematic approach to risk management. Category management is set to receive the second-highest level of digital investment of any procurement discipline. Procurement leaders must show their value to the organization by doing more than saving money.
- AI dominates the short-term procurement agenda but confidence in delivery is uneven. Digital transformation is the most urgent strategic priority for the function, cited by six in 10 executives, with agentic AI the most sought-after technology in procurement. Yet AI adoption has so far yielded mixed results and faces huge technical obstacles. Confidence in the technology’s potential to improve productivity remains uneven, even as executive scrutiny on AI’s returns on investment in procurement grows.
- The human-AI balance will remain in favor of humans for now. Fewer than one in 10 executives (9%) say that they want AI to lead most procurement decisions within the next three years. Five times as many (46%) anticipate a more limited sphere of activity for AI, with the technology supporting tactical and discrete activities like invoice automation while humans retain strategic control.
· After trending upwards since 2023, procurement’s centrality to corporate strategy has declined markedly over the past 12 months. Although three in four executives (74%) are confident in procurement’s ability to collaborate effectively with the rest of the business, that is far fewer than last year (90%). Executive confidence in procurement’s influence over digital transformation has also declined (68%, down from 91%), as has confidence in the function’s effectiveness in risk management.
· Procurement operating models are in transition, but are set to become more centralized over the longer term. In the short term, firms are most likely to adopt shared services and decentralized models to allow localized AI decision-making to digital and AI-driven transformation in the next 12-18 months. But over 3-5 years the center of excellence and center-led models are expected to dominate, as companies seek to centralize AI-enabled decision-making around unified data.
