While most chief procurement officers (CPOs) today are well positioned in their respective ecosystems, and at the forefront of value creation, they are also facing increased pressure to deliver even more value, often with limited resources. They are tasked with navigating complex regulatory landscapes, managing volatile markets, and driving innovation and sustainability — all while keeping costs under control. It’s a complicated balancing act, but one that procurement departments must embrace.

We interviewed more than 50 CPOs across various industries to understand how the function is changing and what the future holds, and identified seven key trends that are set to redefine procurement in the coming years. While some organizations are making bold strides to position procurement as a strategic, agile, digital, and sustainability-focused function, others are still in the early stages of adaptation.

1. Tackling expanding duties with constrained budgets for procurement leaders

Procurement leaders face a unique paradox: Their responsibilities are expanding, yet their budgets remain stagnant. New regulations — ranging from sustainability mandates to cybersecurity requirements — along with the need for enhanced supply chain resilience, are placing additional strains on procurement teams. To bridge this gap, many are leveraging automation, investing in employee upskilling, and reorganizing into shared service centers (Exhibit 1). However, CPOs acknowledge that these efficiency measures alone are insufficient; bold, strategic actions are essential to ensure procurement delivers measurable business impact aligned with organizational priorities.

2. Elevating procurement into a strategic powerhouse

Historically viewed as a support function, procurement is increasingly recognized as a strategic business unit with significant influence. This shift requires strong leadership, measurable impact, and deeper engagement with internal stakeholders. Procurement must evolve beyond mere commercial negotiations and contracting, proactively advising business units on market trends, including risk and innovation, as well as demand management.

3. Adopting procurement to geopolitical and economic challenges

Rising geopolitical risks and economic shifts are forcing procurement leaders to become more agile. This involves developing flexible sourcing strategies and reducing reliance on single suppliers, while also ensuring the capability to onboard new suppliers swiftly. A data-driven staffing strategy that aligns individual capabilities with the demand for high-priority tasks is crucial for efficient resource deployment (Exhibit 2).

4. Forging strategic supplier partnerships for enhanced value

Strategic partnerships and cross-industry alliances with suppliers are becoming vital for driving innovation and sustainability. While many companies maintain strong supplier relationships, few effectively orchestrate these partnerships to maximize mutual benefits. Future procurement alliances will be essential not just for cost efficiency but also for innovation, sustainability, and digital transformation. Leading procurement teams are now forming collaborations across industries, co-investing in supplier development, and sharing compliance efforts to minimize redundancy.

5. Prioritizing user experience in procurement technology

The shift toward automation and artificial intelligence (AI)-driven procurement solutions is gaining momentum; however, many organizations still encounter challenges with adoption. Even with the introduction of source-to-pay platforms, several processes are still considered cumbersome by internal stakeholders. To enhance adoption, procurement leaders must ensure that digital tools are as user-friendly as consumer applications. Balancing automation with human support, particularly for complex procurement tasks, is essential to facilitate engagement.

6. Bridging the digital skills gap in procurement teams

Despite the advances in AI and data-driven decision-making, procurement remains fundamentally a people-centric function. Yet many teams lack the analytical skills necessary to harness digital transformation fully. CPOs estimate that only 10% of their teams are effectively utilizing digital tools, highlighting a critical skills gap. Hiring analytical experts to support the team is a common workaround, but usually insufficient — challenging and fostering analytical skills need to be an integral part of talent management across the whole procurement team.

7. Making sustainability a competitive advantage

Sustainability continues to be a top priority for procurement leaders, with carbon reduction emerging as a primary concern. However, there is ongoing debate about whether sustainability is merely a compliance requirement or a genuine competitive advantage (Exhibit 3). Leading organizations are integrating sustainability into their procurement strategies in ways that foster innovation. For instance, automotive companies are establishing innovation hubs for sustainable materials, while food service providers are restructuring supply chains to promote plant-based alternatives.

Transforming procurement into a strategic enabler by 2030

We expect procurement to fully transform from a support function into a strategic enabler of business growth, innovation, and resilience by 2030. CPOs who take proactive steps now — embedding agility, strengthening internal partnerships, harnessing AI, and leveraging sustainability as a competitive edge — will be the leaders shaping the future of procurement.