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Tariff shocks, inflation, and supply instability have become defining features of the global operating environment. Over the past two years, even the most experienced procurement leaders have navigated disruption at a pace and scale that few could have anticipated. Geopolitical realignments and tariffs are redrawing trade flows in real time. Inflation is biting into margins that took years to build. Supply disruptions expose, in the most public and painful way possible, just how fragile single-source dependencies are.
What makes this moment different is the divergence it creates. According to the 2026 AlixPartners Disruption Index, 82% of executives have already adjusted or are in the process of adjusting their supply chains in response to tariffs and geopolitical instability. The gap between those acting strategically and those reacting tactically has never been wider, and procurement sits at the heart of that divide.
Tariffs: Leverage for those who move first
The instinct when tariffs hit is to absorb the shock and hope conditions improve. That instinct is strategically wrong. The data is clear. Growth leaders are nearly twice as likely as laggards to view geopolitical conflict as an opportunity rather than a threat. Seventy-three percent of growth leaders have already found different suppliers and trading partners in response to tariffs, compared to just 34% of slower-growing companies. They are not renegotiating around the edges. They are fundamentally repositioning their supply base while competitors wait. Procurement teams walking into supplier conversations armed with competitive benchmarks, total-cost scenarios, and clear walk-away positions are finding commercial flexibility that simply did not exist before the disruption began.
The ruling that creates a recovery opportunity
On February 20, 2026, the U.S. Supreme Court delivered a landmark 6-3 ruling in Learning Resources, Inc. v. Trump, striking down all tariffs imposed under the International Emergency Economic Powers Act (IEEPA), finding that the statute does not grant the President authority to impose tariffs. Chief Justice John Roberts wrote that IEEPA's authority to "regulate importation" cannot be stretched to authorize taxation, a power reserved to Congress under Article I of the Constitution. The Penn Wharton Budget Model estimates that over $175 billion in tariff payments are now subject to potential refund claims. For procurement leaders, this creates an urgent, time-sensitive mandate: audit all IEEPA-related tariff payments made since 2025, identify the biggest exposures by category and supplier, and move quickly to secure any potential refunds. Importantly, the administration acted within hours by reinstating a 10% blanket tariff under Section 122 of the Trade Act of 1974 for 150 days. As a result, procurement teams must pursue historical clawbacks and renegotiate supplier contracts to align with the new, lower tariff baseline, while tracking any changes in the tariff situation.
Inflation and the mandate for spend visibility
Inflation has been the slow-moving crisis running parallel to tariff volatility and, in some ways, the more insidious of the two. It has seeped into everything: raw materials, logistics, energy, and labor. The AlixPartners Disruption Index confirms that 60% of U.S. executives cite inflation as a top challenge impacting their business over the past 12 months. Yet the AlixPartners CPO Executive Survey data reveals that procurement leaders are already responding: cost increases from suppliers over the past 12 months average 5–7% for most organizations, but leaders, the top-tier procurement functions are holding that to just 3–5% by applying a wider and more advanced set of mitigation levers beyond direct negotiation and RFPs. The difference is not luck. It can be credited to spend visibility, category intelligence, and the analytical muscle to act before cost pressures become unmanageable.
Supply risk: From hard lessons to structural advantage
The supply chain disruptions of recent years delivered one lesson with unmistakable clarity: concentration is a liability. The CPO Survey found that 75% of procurement executives highlight supply disruption risk as the top external factor influencing their strategies. In direct response, 70% are actively working toward some level of reshoring, with half expecting to reshore 30% of their offshored volumes. These are not aspirational targets; they are operational commitments being executed right now. The AlixPartners Disruption Index survey reinforces why: Growth leaders who invested in supply chain redesign, qualified new suppliers, and built alternative production footprints are already seeing reduced disruption exposure.
Only 34% of these organizations now cite supply chain management as an increasing challenge, down sharply from 49% just a year ago. With heightened geopolitical risks across the Middle East and potential disruption to the Strait of Hormuz, we may see renewed pressure on global supply chains driven by fuel price volatility and escalating shipping costs.
Procurement's strategic inflection point
Here is the broader point every CPO should be making loudly inside their organization right now: this moment is procurement's proof of concept. The CPO Survey found that almost half of procurement executives cite digitization as their primary value lever, with ambitious goals to digitize up to 70% of procurement processes by 2027. Yet only 5% of organizations have fully deployed AI across procurement processes, with most still piloting or planning. The functions that close that gap fastest by building the spend analytics, supplier risk intelligence, and AI-enabled category management capabilities that leaders already exhibit will be the ones that emerge from this period, permanently redefined. Not as cost-cutters. As value creators.
As instability in the Middle East disrupts energy markets and key shipping routes, supply chains are once again facing heightened volatility. In times of disruption, the distinction between companies that react and those that lead becomes clear. This is when procurement moves beyond a support role to become a true strategic lever driving resilience and growth.
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