Global executives' top concerns are sustainability, digital transformation, supply chain disruption and the other potential risks that no one has imagined, but that are likely to show up - just when you think things are finally settling down.If there’s anything takeaways from the past two and half years it’s that nothing is too far out to be considered ‘impossible.’Not only has the list of risks increased, they’ve gotten more complicated too.Sixty-eight percent of 244 surveyed supply chain officers see supplier operational issues as a major risk (24%) or moderate risk (44%), according to the PWC Digital Trends in Supply Chain Survey 2022.Securing raw materials from suppliers was seen as a key risk by 64 percent of executives, while 62 percent said insufficient diversification of supplier base for critical supplies was a top risk that they were addressing. A recent survey conducted by the Institute for Supply Management (ISM) revealed “record-long lead times, wide-scale shortages of critical basic materials, rising commodities prices, and difficulties in transporting products across industries,” were one of the top challenges that operations face.In light of these scarce inputs, a brand’s ability to sustain its growth is highly dependent on working capital to weather this downtime and ramp up for peak seasons, according to Skubana.All Systems on ‘Red Alert’Five of procurement’s top 10 priorities for 2022 are deemed “critical development areas,” with high importance but low confidence in procurement’s ability to meet business expectations, according to a recent study from The Hackett Group. These priorities are: enable corporate sustainability; accelerate digital transformation; improve analytical, modeling, and reporting capabilities; align skills and talent with changing business needs; and improve procurement agility. If operations cannot overcome challenges in these areas, it may be difficult to address critical priorities such as supply risk objectives, the research found. Supply chain leaders can build greater agility and resilience into their supply chains by working with providers who provide new capabilities as a service, said KPMG. Supply Assurance is Now the Top Priority Managing supply disruption and its impact on revenue remains procurement’s top priority, according to The Hackett Group’s research. Last year it ranked in second place.Now cost-cutting, traditionally buyer’s number one priority, has slipped to the number two spot. This reflects continued disruptions driven by the global pandemic. The pandemic has also given suppliers greater leverage and control in the buying relationship, a shift that puts execs at an unexpected disadvantage. Fallout from the growing conflict with Russia over the Ukraine may further accentuate supply disruption concerns, and certainly it is impacting consumer sentiment in the EU and even in other key markets. Brands are realizing that it is now essential to build resilience by developing capabilities in supplier relationship management, improving analytics to better identify and predict supply chain challenges, and overall digital transformation.The Potentially High Cost of ConsolidationDespite the inherent risk associated with focusing on fewer major trading partners, many brands have strong relationships with a limited number of major suppliers, and suppliers have one or two large customers (or export market) and/or one major supply chain partner. As we emerge from the COVID-19 slowdown, many businesses recognise the need to better equip their supply chains by identifying alternative trading partnerships. They are actively seeking a broader list of suppliers, alternative markets/customers and alternative transport and logistics providers. Supply chain leaders can build greater agility and resilience into their supply chains by working with providers who provide new capabilities as a service, said KPMG. 5 Strategies for Reducing Supply Chain Risk According to KPMG sourcing operations need to rethink how they structure their supply chains, how they implement new technology and how they work with third party service providers. Operations should be flexible and resilient enough to adapt and adjust in real-time to changes in trade flows, new regulations, the impact of COVID-19, climate change, trade tensions and other geopolitical movements. Technology should be effectively utilized to help reduce operating costs, provide visibility, and diversify the way customer needs are met. Capability to adapt to digital operations and drive actionable improvements from data is important. Supply chain networks should be responsive to increasing customer requirements. Collaboration and supplier partnerships, and ongoing risk monitoring are all needed to de-risk the supply chain. Sustainability Becomes Critical Sustainability rose more than any other supply chain priority for 2022, jumping up four spots to the number four position, the research found. Roughly 23 percent of supply chain professionals say they struggle to respond to the rapidly evolving environmental social governance (ESG) legislative and regulatory frameworks in relevant jurisdictions, according to PwC.Just a few years ago sustainability was something that was left to factories to deal with. As long as they looked like they were making an effort to green up, brands could check the box on moving to more sustainable .Brands must be able to source responsibly to support the longer-term business impacts of climate change and diversity commitments and adapt to support ESG strategy and the execution of operational plans. However, complying with new laws that demand greater transparency and traceability have added even more administrative work on both brands and suppliers. Even with digitization, the documentation can be daunting. 80% of digital supply chain investments are falling short of expectations. 58% of respondents are seeing higher than normal supply chain employee turnover, - according to a PwC survey Digital Transformation Remains a Key Focus The PwC survey reveals that 80 percent of digital supply chain investments are falling short of expectations. In addition, almost 58 percent respondents are seeing higher than normal supply chain employee turnover, while 23 percent say they struggle to develop and retain the “digital native” talent needed to transform supply chains.Few companies are able make successful digital transformation, said McKinsey & Co. Digital transformation remains a front and center enabler, now with a greater focus on obtaining value from technology investments and an increased rigor around data management to deliver up-to-date insights that inform supply risk, and supply management, according to The Hackett Group’s research. Supply chain leaders expect an 8 percent increase in capital investment and technology costs in 2022, in large part to drive digital transformation. Digital workforce enablement and core procurement application suites have the highest level of large-scale adoption in procurement. Data visualization and master data management tools are not far behind, and are also expected to see accelerated growth. But for digital transformation to be successful, procurement organizations must also focus on talent and data, the research suggested. Staffing Remains a Key ConcernWorkloads are expected to increase by 11.4 percent in 2022, the research found. But no increase is expected in staffing, and a reduction is expected in budget, creating large productivity and efficiency gaps that must be overcome, in part through the use of technology. The efficiency gap, when combined with escalating salaries in supply chain management and the higher turnover levels driven by the pandemic, is putting greater pressure on organizations, according to The Hackett Group’s research. In digitizing their supply chains, respondents to the PwC survey said they need the most help stretching their budgets, but having the right talent and the right technology are issues as well.