[Editor’s Note: Today’s article is a guest post based on a conversation between Ardent’s Andrew Bartolini and Graham Scott, Senior Vice President, Chief Procurement Officer at Jabil. Scott leads a global procurement organization responsible for more than $26 billion in annual spend and a supplier ecosystem of approximately 38,000 partners worldwide. He shapes strategy across electronics, mechanicals, indirect materials, and compliance, and manages a team of more than 1,000 procurement professionals across 25+ countries, aligning procurement strategy to enterprise growth, margin expansion, and risk management. With over 30 years of procurement and supply chain experience, Scott focuses on positioning procurement as a strategic growth driver rather than simply a cost center.
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1. Everyone is talking about the AI boom, but you’re seeing its impact play out in real time across the semiconductor supply chain. What’s happening beneath the headlines that most procurement leaders don’t fully appreciate yet?
The AI boom is often discussed as a compute story, but it is just as much a memory story. Beneath the headlines, the supply chain is being reshaped by the amount and type of memory required to support AI infrastructure. High-bandwidth memory, advanced DRAM, enterprise SSDs, and packaging capacity are becoming bottlenecks, not background commodities.
What many procurement leaders may not fully appreciate is that this is not simply “more demand for chips.” It is a reallocation of capacity toward the applications suppliers view as most strategic and most profitable. When memory manufacturers prioritize AI servers, hyperscale data centers, and next-generation platforms, that capacity is not available elsewhere. The impact then ripples into PCs, networking equipment, industrial systems, automotive platforms, and consumer devices.
The other underappreciated issue is timing. Semiconductor supply chains do not correct quickly. New capacity takes years, qualification cycles are long, and supplier allocation decisions are often made well before customers see the impact on lead times or pricing. By the time the shortage feels obvious, the best options may already be gone.
It needs to be treated as a critical supply risk tied directly to revenue, product availability, customer commitments, and competitive position for years ahead. The companies that see this early will have more optionality. The companies that wait for the market to normalize may find themselves reacting to decisions that were made months earlier.
2. Graham – You’ve said the industry may be heading into a prolonged period of memory chip shortages through 2027. How should CPOs rethink their planning horizons when “temporary disruption” starts to look more like a multi-year structural shift?
The first shift CPOs need to make is moving from disruption management to structural planning. In a , procurement teams can often bridge the gap with spot buys, escalation, premiums, or expedited logistics. Those tools may still help at the edges, but they are not a strategy if the market remains constrained through 2027.
CPOs should be pushing their organizations toward a rolling 18-to-36-month view of demand, supply exposure, and product risk. That does not mean locking in every requirement blindly. It means identifying which programs are most exposed, which parts have limited alternatives, where memory content is increasing, and where the business is willing to make commitments in exchange for allocation certainty.
3. In a market dominated by a small number of powerful suppliers, traditional sourcing strategies can break down pretty quickly. What does effective supplier engagement look like when leverage is limited but the stake are high?
When supplier leverage is limited, procurement has to shift from a pure negotiation mindset to an allocation mindset. In a concentrated market, the most important question is not simply, “How do I get a better price?” It is, “How do I become the customer this supplier wants to support when capacity is constrained?”
That starts with credibility. Suppliers are more likely to prioritize customers who provide accurate forecasts, make decisions quickly, honor commitments, and engage before the market is in crisis. In a tight environment, uncertainty is costly for suppliers too. If a customer regularly changes forecasts, delays approvals, or treats commitments as optional, that customer becomes harder to allocate scarce supply to.
Effective supplier engagement also means getting beyond the commercial interface. CPOs should build executive relationships, but they also need procurement, engineering, supply planning, and product teams connected with supplier counterparts. The best conversations are not limited to price and lead time. They include roadmap alignment, allocation assumptions, qualification timelines, packaging constraints, design alternatives, and long-term demand scenarios.
This is where optionality matters. If you have only one approved part, one supplier, one density, or one configuration, you have very little room to maneuver. If you have qualified alternates, flexible designs, and clear substitution paths, you can engage suppliers from a stronger position, even without traditional leverage.
In this environment, the best procurement organizations will not only be aggressive but fair negotiators. They will be trusted, prepared, transparent customers that suppliers can plan around and depend on under real pressure.
4. You mentioned the importance of committing early and designing for flexibility. Can you unpack what that actually means in practice for both procurement and the broader business/product teams? Where do you see companies getting it wrong?
Committing early does not mean panic buying or over-ordering. It means making deliberate commitments before the market forces your hand. In practice, that can include long-term agreements, volume bands, capacity reservations, early purchase commitments for critical programs, or joint planning with suppliers around future product ramps. The commitment should be tied to real business priorities, not fear.
Designing for flexibility is the other side of the same strategy. Procurement can only create options if the product architecture allows for them. Engineering and product teams should be thinking early about alternate memory suppliers, alternate densities, compatible footprints, firmware flexibility, qualification requirements, and substitution paths. Flexibility designed in at the concept stage is far cheaper than flexibility forced in during a shortage.
Where companies often get it wrong is that they separate product decisions from supply decisions. A product team may select a component because it is technically attractive or lowest cost at that moment, without fully considering whether it can be sourced reliably at scale. Then, shortly before launch, procurement is asked to “go find supply.” At that point, options are limited and expensive.
The better model is concurrent planning. Procurement needs a seat at the table while design decisions are still being made, not after the bill of materials is frozen. Product teams should ask, “What optionality are we preserving?” Finance should ask, “What is the cost of not preserving it?” That is how companies avoid being trapped by decisions that looked efficient on paper but created fragility in execution.
5. There’s always tension between cost optimization and supply continuity, but it feels especially acute right now. How should procurement leaders reframe that trade-off when the cost of disruption may far outweigh the cost of supply?
The trade-off needs to be reframed around total business impact, not just unit cost. In a constrained market, the lowest purchase price is not always the lowest-cost outcome. The real cost equation has to include lost revenue, delayed launches, production downtime, expedite fees, customer penalties, redesign costs, and reputational damage. Once those costs are visible, paying more for secure supply can look less like inefficiency and more like insurance.
That does not mean abandoning cost discipline. It means applying it with more precision. Procurement leaders should segment categories and components by criticality. Not every part deserves the same level of protection. But parts that can stop production, delay a strategic launch, or compromise a customer commitment need a different decision framework. For those components, the right question is not, “Can we save another two percent?” It is, “What level of supply assurance are we buying, and what risk are we avoiding?”
CPOs also need to make these trade-offs explicit for the business. If the company chooses not to reserve capacity, not to qualify alternatives, not to hold buffer inventory, or not to accept a higher-cost supplier, that is a business decision with consequences. Procurement’s role is to quantify those consequences and make sure they are not hidden inside a purchase price variance discussion.
The companies that navigate this well will still care about cost. But they will optimize for resilience-adjusted cost, knowing where to negotiate, where to pay for assurance, where to build inventory, and where to redesign for flexibility.
6. Looking ahead, what separates the organizations that will navigate this type of cycle successfully from those that won’t? And what should CPOs be doing in 2026 to make sure they’re in that first group?
The organizations that navigate this cycle successfully will be the ones that treat supply as a strategic capability, not a back-office function. They will have better visibility, stronger supplier relationships, tighter internal alignment, and more optionality built into their products and contracts.
There are a few practical differences. First, they will understand their exposure at the part and program level. They will know which products depend on constrained memory, which suppliers and technologies create the greatest risk, and where demand growth could exceed secured supply. Second, they will act earlier. They will not wait for missed shipments before engaging suppliers, qualifying alternatives, or making commitments. Third, they will connect procurement directly to product, finance, sales, and customer planning.
For CPOs in 2026, the priority should be building a supply continuity playbook for all critical categories such as semiconductors. That includes mapping risk, identifying single-source dependencies, qualifying alternates, creating escalation paths with suppliers, and establishing decision rules for when to commit, when to buffer, and when to redesign. It also means having honest conversations with leadership about the cost of resilience and the cost of inaction.
The winners will not be the companies that predict the market perfectly. No one will. The winners will be the companies that preserve the most options and make decisions early enough for those options to matter. In this kind of cycle, supply continuity is not just risk management. It is a competitive advantage, and CPOs are in a position to lead that shift in volatile markets like this.
