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With geopolitical volatility, surging costs and other disruptions, the question isn’t whether operations and supply chains will change. It’s how fast and intentionally leaders can guide that evolution. PwC’s 2025 Digital Trends in Operations Survey — based on insights from 610 operations and supply chain leaders — paints a clear picture. COOs and their teams play a critical role in driving business transformation, but many are still juggling short-term firefighting with long-term strategy.
Here’s what we found and what you can do to move faster from a triage mindset to accelerating transformation in the months and years ahead.
The tension between rapid response and long-range planning is real. A large majority — 82% — say they face challenges in balancing short-term needs with long-term strategic changes. Most (68%) say the challenges are manageable, and 14% say they’re significant. Still, executing on a multiyear strategy while prioritizing ongoing cost and efficiency pressures — especially with sweeping tariff changes under the Trump administration — uses time and resources that could be dedicated elsewhere.
And current events are causing concerns for many operations and supply chain leaders. Roughly nine out of 10 say supplier and material costs will increase significantly in the year ahead. That can strain budgets, reduce profit margins, trigger supplier renegotiations and disrupt planning. A similar number of respondents (91%) say US trade policy changes are moving them to significantly change supply chain strategies, and almost as many (87%) say geopolitical risks are driving them to more flexible operations. All this can raise the pressure for more effective scenario planning and adaptability in supply chains.
Artificial intelligence (AI) could be part of the solution. AI can accelerate the speed of insights, decision-making and organizational change. We’re also beginning to see how AI agents can fundamentally transform work and change how businesses operate. For instance, AI agents can be coordinated across demand forecasting, procurement and logistics tracking to address potential supply chain bottlenecks and reduce delays.
More than half (53%) of survey respondents say AI is being used in either a few areas or widely to anticipate and mitigate supply chain disruptions. Another 31% say they’re testing and piloting AI for those purposes. Responses are similar for scenario planning and operational transparency, with 55% using it in at least a few areas and 29% testing and piloting AI.
What it means for you: Focus on being efficient in the near term but do it in a way that allows your company to be flexible and ready for future challenges. Explore how to apply AI in different ways — from driving efficiencies today to anticipating and evaluating scenarios to better configure for tomorrow.
Among technologies used by companies, AI (59%) and cloud (56%) are tops, and almost all of those respondents say those capabilities are somewhat or very effective in creating value (98% for AI, 96% for cloud) — driving revenue, increasing productivity or managing costs. Advanced capabilities like digital twins and data ecosystems lag far behind in adoption but could be a missed opportunity. Although only 21% say their companies use digital twins, 97% of those respondents say that capability is either somewhat or very effective in creating value.
There’s other cause for concern. Despite using multiple digital capabilities, 92% of operations and supply chain leaders cite at least one reason why tech investments haven’t fully delivered the expected results, and 83% cite two or more reasons. Integration complexity (selected by 47%) and data issues (44%) are the most common reasons — a shift from the previous survey and likely an indicator of the struggles of adapting to and leveraging new AI solutions. Alarmingly, one of the least selected reasons is the business case for tech investment — unclear objectives, weak rationale or difficulty understanding costs — which may suggest a blind spot for many companies.
What it means for you: As technology becomes more complex and issues more frequent, it’s increasingly important to understand how a capability integrates with others. Value comes from using tech well, which often means investing in new architectures. Less used capabilities like digital twins show high impact and can answer many “what if” questions when applied effectively — especially in an environment where organizations are looking to become more flexible in their operations. Focus less on quantity and more on integration and measurement, especially in tracking costs and ROI.
The turbulence so far in 2025 makes it clear: Your supply chain needs to be faster, smarter and more resilient than ever. As COOs and supply chain leaders increasingly evaluate their entire ecosystems, they’re using several technologies to improve collaboration with vendors, customers, third-party logistic providers and other value chain partners.
Some lesser used capabilities are delivering solid returns and could help create value for companies. Consider that only 33% are using Internet of Things (IoT) enabled supply chain capabilities, yet 52% of those respondents say they’ve been very effective in creating value.
What it means for you: Maintain focus and a results-oriented mindset amid the growing volume and complexity of new technologies. Keeping an eye on “fit for purpose” is key, and solutions that can improve visibility, transparency and scenario modeling should be investigated considering how effective they are for other companies.
Companies are trying multiple ways to develop a digital-ready workforce in operations, and hiring skilled talent and targeted training (47% each) top the list. But similar to improving collaboration with ecosystem partners, some less-used actions are proving very effective and could be a differentiating opportunity for companies.
Fewer than one-third of the respondents say they’re using gamification or incentives, offering certifications or acquiring a company for talent to build a digital-ready workforce. Yet among the companies doing those things, about half of survey respondents say they’ve been very effective.
What it means for you: Hiring and training will always be important, but those are table stakes. To gain a competitive edge, consider specific incentives and certifications to boost your digital workforce. Also don’t sleep on potential acquisitions that could provide an influx of tech expertise.
AI isn’t just another technology, and this is an adjustment from how executives have historically thought about AI — as solely an enabler that’s primarily the domain of IT people. As it continues to become a natural part of everything people do, AI should be intrinsic to your strategy and capability systems — including operations.
The survey found that many companies are using AI in operations and supply chains, with 57% of respondents saying they’ve already integrated AI partially or fully into their operations.
But adoption often meets with friction, and several challenges remain in effectively scaling AI in operations. Integration with existing systems — ranked among the top three challenges by 42% of respondents — and data issues (37%), such as availability and quality, are most common. This aligns with our experience as we often see companies overlook the complexity in developing new AI capabilities — all of which require solid integration and data to power high ROI solutions. When integrated well, AI can be a tremendous help in resolving data challenges.
What this means for you: AI is everywhere, and scaling it in operations can be a challenge. If you’re already on the road of integration, explore how AI can help address data challenges, focus on evolving how employees work and enable them to help drive more change. If your AI program is still young, be open to learning from other organizations and build a culture that allows your teams to absorb and advance your AI aspirations.
Reinventing your operations can provide a competitive advantage, and it’s not too late to be proactive with your digital strategy for operations and supply chain. To outpace the pack, your company should make smart trade-offs, adopt capabilities that truly deliver and build a workforce and operating model equipped to thrive in uncertainty. Here are eight moves you can take now.
Follow through on your digital operations priorities. Obvious? Maybe. But between the survey findings and our experience, too many companies aren’t aligning time and resources with top priorities. If resiliency and customer retention are goals, adjust investments and staffing to reflect that, especially in areas like scenario planning and digital workforce readiness.
Anticipate versus react to disruption. Using tech for basic risk management won’t cut it. Leverage predictive models for supply chain disruptions and build flexible operating models that adapt in real time. Building your scenario planning capabilities is critical.
Invest in data as a strategic asset. Data integration should be a core capability, not an IT problem. Remove departmental barriers, improve data quality and enable cross-functional access so new capabilities can generate more value.
Double down on making digital ROI clear. Prioritize initiatives that improve cost visibility and reduce risk in operations. Tie AI and other tech investments directly to performance metrics and value drivers — and develop specific capabilities to model and manage costs, especially when applying AI.
Integrate, don’t just implement. Simplify system architecture and build a foundation for integration instead of treating it as an afterthought. By doing that, you can better unlock value from data and advanced decision models.
Make AI everyone’s business. Pilot programs have their purpose but can be limited in scope and impact. Focus on AI use cases like inventory optimization, connected worker and digital coach enablement, close loop analytics for operations excellence and ecosystem collaboration to deliver measurable value.
Strengthen ecosystem/partner collaboration. An effective ecosystem can help simplify complexity and better deliver for your customers. Build an ecosystem strategy that includes tech, data and value chain partners. Each can bring capabilities required to enable differentiated service and value for your customers. AI agents also can help reduce friction across your ecosystem.
Embed learning into your operating model. Incorporate mentorship, role evolution and peer learning programs into your culture. Increasing digital fluency in operations and supply chains is critical to standing apart from competitors.
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PwC’s 2025 Digital Trends in Operations Survey surveyed 610 operations executives and supply chain officers in February and March 2025. Respondents in the online survey included C-suite executives, upper management, directors and managers based in the US who either have sole responsibility for business decisions on operations and supply chain or procurement operations or share influence with others regarding those decisions. Sectors surveyed include consumer markets; energy, utilities and resources; pharmaceuticals and life sciences; industrial products; and technology and telecommunications.