[Editor’s Note: Ardent Partners recently published its Procurement-themed report, “Procurement 2024: BIG Trends and Predictions.” Over the next few weeks, this site will feature articles highlighting the key discussion points from the report.
Chief Procurement Officers and their teams head into 2024 with a continued lack of clarity and a need for caution. While a recession was avoided last year and inflation slowed its pace in most regions, economic and overall market uncertainty remains. In addition, geopolitical unrest in the Middle East and climate conditions in Central America are causing big delays and increased costs in global shipping, forcing many procurement teams to seek alternative sources of supply. While the details fluctuate year to year, procurement’s headline remains the same. In 2024, CPOs face a series of new challenges that must be managed while operating with high uncertainty … AND great opportunities exist for the teams who are best prepared for them.
Over the next few weeks, we’ll feature the BIG trends in procurement followed by equally BIG predictions for 2024 that will help CPOs and procurement professionals understand the key issues at hand and better prepare them for the year ahead.
Prediction #12 – The U.S. Election Will Be High Stakes for CPOs
It is a presidential election year in the United States. Every election year, the talking head pundits on each 24-hour news channel will literally say “this is the most important election of our lifetimes” — they are saying that to improve their ratings. It may or may not be true. But, given the highly-polarized state of the United States in 2024 (see Trend #5), the outcome in November could have a significant impact on business, supply chains, and the CPO — and not just U.S.-based CPOs. Putting politics aside, there are a series of issues that will change based on who (and what party) wins the election. Here are a few:
The U.S. presidential election will impact NATO and its future. Will NATO continue to exist? How will the United States’ military and financial support to Ukraine be impacted? If support for Ukraine ends or decreases, what will that mean for the outcome of the Russo-Ukrainian War? Will an empowered Putin place other independent countries (i.e., Poland or the Baltics) at risk? How do these potential changes impact the supply chain today? The U.S. trade policy toward China will be different depending on who is elected president. These and other issues like them must be considered when making sourcing decisions in 2024.
In 2022 and 2023, CPOs prioritized ESG programs above many others. Will continued investment and focus in ESG make sense after the election? Finally, Ardent Partners predicts that there will be economic consequences no matter who wins; the stock market and supply markets will be impacted. The return of inflation and the risk of recession in 2025 increases greatly, no matter who wins.
Prediction #13 – Buyer Beware: “Fake News” and Disinformation Invades Supply Markets
Fake news and disinformation campaigns have been very effective in creating confusion and affecting political opinions on social media. These tools have the potential to do exactly the same thing within supply markets by manipulating perceptions, distorting facts, and sowing distrust among stakeholders. They are being used today and that use will grow exponentially over the next 3 years. Here are a few examples of how they could be used:
- False Reports on Supplier Performance: Malicious actors could spread false information about suppliers’ performance, quality standards, or ethical practices through fake news articles, fabricated reviews, or misleading social media posts. This misinformation could lead to unwarranted concerns or doubts among buyers, impacting their decisions and disrupting supply chains.
- Market Speculation: Fake news and disinformation campaigns can artificially inflate or deflate market perceptions by spreading rumors or false reports about supply and demand dynamics, commodity prices, or geopolitical events. This misinformation may trigger panic buying, stockpiling, or speculative trading activities, leading to price volatility and market distortions.
- Counterfeit Products: Disinformation campaigns could promote counterfeit or substandard products as genuine, misleading buyers about their authenticity, safety, or performance. This can undermine consumer trust, compromise product integrity, and create liability risks for businesses throughout the supply chain.
- Manipulation of Regulations: Fake news and disinformation can be used to influence public opinion and policymakers, shaping regulatory agendas or trade policies in favor of certain industries or stakeholders. By spreading misinformation about the environmental or health impacts of specific products or practices, malicious actors may seek to sway regulatory decisions or hinder market access for competitors.
- Cyberattacks and Data Manipulation: Disinformation campaigns may be coupled with cyberattacks or data manipulation tactics to compromise supply chain integrity or disrupt critical infrastructure. By spreading false alerts about security breaches, product recalls, or supply chain disruptions, cybercriminals can create chaos and undermine confidence.
Combating fake news and disinformation in supply markets requires a multi-faceted approach involving enhanced transparency, critical thinking, fact-checking mechanisms, and collaborative efforts among stakeholders. Procurement teams can play a pivotal role in mitigating the impact of misinformation by fostering trusted relationships with suppliers, conducting thorough due diligence, and staying vigilant against potential threats to supply chain integrity and reputation.
