Sphera: How Supplier Disruption is Hitting Revenue

Almost three-quarters (73%) of procurement and supply chain leaders have experienced supplier disruptions over the past 12 months.

That's according to the latest research from Sphera, a provider of integrated sustainability and operational risk management software, data and consulting services.

The majority of firms hit by disruption saw it negatively impact their bottom line.

The cost of constant disruption

Sphera found that the revenue impact of supply chain risk is a near-universal issue.

Around a quarter (23%) of respondents reported significant revenue or cost losses, while an additional 50% acknowledged minor losses.

"The world is going through a reset in supply chain strategy," says Paul Marushka, CEO and President at Sphera.

"The linear model of stretching supply chains globally to maximise efficiency and lower costs is going away. Trade restrictions, export controls and geopolitical disruption around the world continue to change the game.

"Firms require an agile, segmented and geographically-aligned approach that builds in resilient sourcing strategies concurrently to balance risk."

Sphera's study once again demonstrates that supply chain disruptions no longer represent rare shocks. Instead, they have grown to represent a constant drag on profitability, investor confidence and growth.

Strategic intent meets operational reality

Procurement and supply chain leaders planning bold moves but encountering risk barriers along the way.

The vast majority (94.5%) of those surveyed said they were likely to shift a critical portion of their supply chain to another region in response to tariffs, regulations and geopolitical pressures.

However, numerous major operational barriers stand in their way, including: 

• Speed of supplier risk checks – 33%
• Compliance documentation and audit readiness – 26%
• Data accuracy in emerging markets – 21.5%
• Visibility into tier 2-3 suppliers – 16%

AI: Bridging the gap between strategy and execution

There exists a belief among executives that AI is a critical lever to close the gap between strategic intent and operational readiness.

Executives highlighted AI-generated supplier risk summaries as essential for faster operational decisions (31%), faster strategic decisions (29%) and speed and accuracy in under 60 seconds (24%).

The survey respondents are clear on what the board expects in return:

• Cost savings and cost avoidance – 28% 
• Revenue protection from disruption – 24% 
• Top-line revenue growth – 21%