3 min read
Procurement Under Pressure: Disruption, AI, and the New Operating Model
Philip Ideson : April 12, 2026
““Change is the only constant today. Disruption is happening more frequently, and procurement has to be ready for the unknown.”” - Jon Jensen, Partner & Managing Director, AlixPartners
Procurement teams are operating in a very different environment than even a few years ago. Disruption is no longer episodic; it is constant and coming from multiple directions at once. At the same time, expectations from the business continue to rise. Procurement is still expected to manage cost, but it is also being asked to contribute to growth, to navigate risk, and to make sense of how technologies like AI can actually create value.
What makes this moment particularly challenging is that none of these priorities sit in isolation. Decisions about operating models, supplier strategy, and technology investments are now deeply interconnected.
Understanding how other leaders are responding to the same pressures can often provide a clearer path forward than theory alone.
In a recent Art of Procurement podcast episode, I spoke with Amit Mahajan and Jon Jensen from AlixPartners about research based on data gathered from 120 senior procurement leaders. What stood out to me was not just the consistency of the challenges, but the differences in how leading teams are choosing to respond.
Here, in my opinion, are a few stand-out moments from our conversation that are worth thinking more deeply about.
Disruption is Driving Every CPO Agenda
“If you look at the data, it’s actually a collection of points that are focused, and it’s all around disruption, right? It’s supply availability, tariff and cost reduction, operational failures…Disruption is the theme of the day.” - Jon Jensen, Partner & Managing Director, AlixPartners
What resonated with me here is how broad the definition of disruption has become. It is no longer just about supply interruptions or logistics constraints. It now includes tariffs, cost volatility, operational breakdowns, and increasingly, cyber risk. That breadth makes it harder to manage through traditional approaches. The leaders I see responding most effectively are not trying to predict every disruption. They are building the capability to respond when disruption happens. That shows up in how they structure their supply base, how they engage with key suppliers, and how early they insert themselves into business decisions.
Indirect Procurement as a Growth Lever
“We found out through that process is that the lack of indirect procurement capabilities and capacity was limiting their ability to deploy new customer projects…Indirect procurement can become a growth engine to the business.” - Jon Jensen, Partner & Managing Director, AlixPartners
This is an area where I still see a mindset gap in many organizations. Indirect procurement is often viewed through a cost lens, or as a function that supports the business rather than enabling it. What Jon described is something I have seen as well. When indirect procurement lacks capacity or capability, it does not just slow down internal processes. It can actually constrain growth. That is a very different conversation to have with stakeholders. It shifts the focus from cost control to value creation. The implication for leaders is that investment decisions in indirect procurement need to be made with that broader impact in mind.
AI: From Buzz to Practice
“More than 90 percent of the CPOs are talking about AI and are thinking about it. But there’s a difference between thinking and actually doing something about it.” - Amit Mahajan, Partner, AlixPartners
This is probably one of the most honest reflections of where the market is today. There is no shortage of interest in AI, but there is still a gap when it comes to execution. From my perspective, that gap is not surprising. AI introduces questions around data, cost, and capability that most organizations are still working through.
What I took from this part of the conversation is the importance of moving forward in a practical way. The leaders who are making progress are not waiting for everything to be perfect. They are identifying specific use cases, testing them, and building confidence over time.
ROI – Be Realistic and Targeted
“Everybody thinks, ‘hey, if I just put in an AI solution here, it’ll give me 10x ROI’…We need to temper down our expectations.” - Amit Mahajan, Partner, AlixPartners
There is a natural tendency to expect outsized returns from new technologies, especially something as visible as AI. What Amit highlighted is the need to be more measured. In my experience, this is where many initiatives either gain traction or stall. If expectations are set too high at the outset, it becomes difficult to demonstrate success early on. A more balanced approach is to focus on where AI can deliver tangible value in the near term, while recognizing that larger gains will come as capabilities mature. That balance between short-term impact and long-term potential is critical.
Leaders Engage Differently – with Suppliers, Data, and AI
“Leader leaders are engaging in different ways, including changing specs or service offerings, innovating with suppliers, using demand management.” - Jon Jensen, Partner & Managing Director, AlixPartners
The distinction between leaders and followers is becoming more visible in how procurement engages with the business and with suppliers. Traditional approaches centered on negotiation and sourcing events are still part of the toolkit, but they are no longer sufficient on their own. The leaders are getting involved earlier, shaping demand, and working more closely with suppliers to find different ways of delivering value. That requires a different set of skills and a different mindset. It also reinforces the idea that procurement’s role is expanding as they wield more influence over business outcomes.
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