The 2026 State of Agility in Procurement & Supply reveals an uncomfortable gap between technological ambition and organisational reality. For procurement leaders, the question is no longer simply how quickly AI can be adopted, but whether the commercial system around it is capable of converting faster technology into faster value creation.
Artificial intelligence is already changing procurement. Analytics are becoming more powerful, operational tasks can increasingly be automated, information can be processed at far greater speed and decision-makers can access insights that would previously have required considerable manual effort.
Yet the 2026 State of Agility in Procurement & Supply suggests that the decisive constraint on procurement transformation may sit somewhere else entirely.
Seventy per cent of respondents believe their current operating model constrains the benefits that could be achieved from AI. Among respondents who have adopted AI, 73% report that adapting the operating model required to scale those benefits remains difficult or only partially implemented.
For CPOs, this changes the nature of the transformation agenda. The challenge is not simply whether procurement has the right platforms, automation or analytics. It is whether procurement, finance, legal, technology, business stakeholders and suppliers can make decisions, share information and respond to change in a way that allows those capabilities to matter.
From functional efficiency to system performance
Procurement has spent decades improving functional performance. Strategic sourcing has become more structured. Category management has matured. Supplier management has become more sophisticated. Data, technology and automation have progressively reduced the administrative burden of many activities.
Those advances remain important. But the State of Agility research points towards a different source of competitive advantage: the performance of the complete commercial system rather than the efficiency of any single function inside it.
One of the clearest signals is the changing hierarchy of commercial priorities. In contrast with earlier periods in which cost optimisation dominated the agenda, respondents now place Business Agility & Adaptability at the top of the commercial agenda, closely followed by Innovation & Business Model Evolution and Cost Optimisation & Profitability. Across the full respondent base, 96% consider business agility strategically important in dealing with greater market uncertainty.
That does not mean savings, governance or control have become less relevant. It means organisations increasingly need those disciplines to work in an environment where requirements change, markets move, technology evolves, supply conditions shift and commercial assumptions can become obsolete before a traditional process has finished running.
For procurement, agility therefore cannot be reduced to running a sourcing exercise more quickly. It is the ability of the commercial system to absorb change without creating disproportionate delay, confusion or risk.
The report exposes why that remains difficult. Ninety-four per cent of respondents say functional silos limit or delay value creation to some degree. More than half, 56.54%, say the effect is significant, while another 9.42% describe it as critical.
The bottlenecks are equally revealing. Requirement and scope definition emerges as the largest reported source of delay, followed by governance and approvals and then finance approvals and budgeting. When respondents are asked about the root causes behind slowdown, conflicting functional objectives, limited transparency between silos and changing requirements or constraints come out on top.
These are not procurement-process problems in the narrow sense. They are coordination problems.
A procurement function can execute brilliantly and still sit inside a slow commercial system. A category manager can move quickly but wait for a business requirement. Legal can draft efficiently but receive an issue late. Finance can apply sound controls but become an additional queue. Technology can deploy powerful tools while information remains fragmented between functions. Suppliers can be asked to innovate while being introduced only after most important decisions have already been made.
This is the central challenge the research brings into view. Organisations have become increasingly sophisticated at optimising individual functions while the connections between those functions remain a major source of delay.
The report captures the issue in a simple principle: every handoff creates the potential for delay, distortion and loss. AI can improve individual steps. Only redesign improves the system.
That distinction matters because procurement transformation has often been built around making existing activity more efficient. The next phase may require leaders to ask whether the activity, sequence, ownership or approval structure should exist in the same form at all.
The AI test: are we redesigning work or accelerating old work?
The State of Agility study does not suggest that AI investment is failing. Respondents already report tangible benefits from technology adoption. Improved analytics and reporting represents 27.59% of the reported benefit, automation of operational tasks 26.11%, business insights 23.65% and self-service enablement 19.7%.
These are meaningful gains. They also reveal something important about the current stage of adoption.
Most of the benefits improve existing ways of working. AI analyses information faster. It automates an activity. It provides insight sooner. It enables a user to complete something without manual support.
The larger transformation opportunity begins when organisations stop asking only how AI can improve the current process and start asking how the commercial process should operate now that different capabilities are available.
The report shows that traditional organisational structures still dominate. Divisional and business-unit models, functional models and matrix organisations remain common, while genuinely adaptive and AI-enabled operating models are comparatively rare.
That creates a structural problem. Technology capable of operating at digital speed is being inserted into systems built around sequential handoffs, fixed responsibilities, fragmented information and approval-driven governance.
The result can be a form of local optimisation. Procurement becomes faster, but the business case still waits for finance. Contract analysis becomes faster, but legal is brought into the process too late. Supplier discovery improves, but scope definition remains static. Data becomes richer, but decision rights remain unclear.
In that environment, AI may make individual tasks faster without materially improving end-to-end commercial performance.
The research suggests respondents can see the alternative. When describing a high-performing commercial operating model, they favour data-driven and dynamically adjusted ways of working, empowered cross-functional teams and AI-enabled platform teams capable of supporting self-service. Their target operating model is defined most strongly by three characteristics: cross-functional and empowered teams; AI-enabled and data-driven decision-making; and agile, adaptive and simplified governance.
Technology is present throughout that model, but technology is not the model.
The model is the way people, process, governance, information, decision rights and technology operate together.
That gives procurement leaders a more useful test for AI investment. Is the technology genuinely changing how the value stream operates, or is it making one function more efficient inside an unchanged system?
That question becomes particularly important when the scale of the perceived opportunity is considered. Respondents were asked how much faster their organisations could operate if fragmentation and barriers to shared decisions and accountability were reduced. 44.08% estimated a 20% improvement and 38.82% estimated a 50% improvement. A further 9.87% selected between 10% and 20%, while 4.61% believed the organisation could become 100% faster. Only 2.63% expected no improvement.
These are respondent estimates rather than measured productivity outcomes, but the message is difficult to ignore. Leaders see enormous amounts of organisational capacity trapped not only in manual work, but in waiting, handoffs, competing objectives, duplicated effort and unnecessary governance.
For procurement, that means the business case for transformation should not be confined to procurement productivity. Time spent waiting for decisions matters. Rework caused by weak requirement definition matters. Repeated interpretation between functions matters. Supplier waiting time matters. Approval layers matter. The elapsed time between a commercial need being identified and value actually reaching the organisation matters.
That is a much larger canvas than automation alone.
Procurement’s boundary is expanding into the supplier ecosystem
The internal operating model is only part of the story.
One of the strongest findings in the report is that 93% of respondents believe reducing fragmentation with strategic customers and suppliers is important or very important. The areas in which respondents see the greatest need for cross-company collaboration include innovation, go-to-market activity, R&D and sales and marketing.
This has major implications for procurement because many traditional procurement models were designed around controlled transactions between separate organisations. A requirement is defined internally. Suppliers are invited to respond. Terms are negotiated. A contract formalises the arrangement. Performance is then managed against agreed obligations.
That model remains entirely appropriate for many categories and risks. But it becomes more restrictive where speed, learning, innovation and joint adaptation are central to the outcome.
If organisations want strategic suppliers to contribute ideas, respond to changing market conditions or co-develop solutions, those suppliers cannot always remain outside the operating model until the sourcing process reaches them.
The State of Agility research points towards a more connected commercial ecosystem in which selected suppliers and customers become part of shared decision-making, innovation and delivery. The report highlights adaptive contracting, relational governance and outcome-based approaches as increasingly important where fixed requirements, static risk allocation and traditional governance constrain adaptability.
That does not mean weakening commercial discipline. It means designing commercial discipline for the type of work being undertaken.
For procurement leaders, this is a significant shift in role. The function is no longer simply negotiating the commercial relationship after the operating model has been decided. In the most strategic environments, procurement can help design the conditions under which the relationship creates value.
That includes deciding when suppliers should be involved, what information should be shared, how objectives should be aligned, where authority should sit, how risk should be governed and how commercial mechanisms can adapt when circumstances change.
It also exposes the distance many organisations still have to travel. Seventy-eight per cent of respondents report being at some stage of adopting a new operating model to scale AI-driven value, but maturity remains heavily concentrated at the early stages. 31.11% are conducting first experiments with cross-functional practices and AI solutions. 22.22% report successful pilot projects and 15.56% have initiated functional transformation. Only 7.41% report transformation coordinated at company level, and just 1.48% say transformation includes partners across the value stream.
The ecosystem ambition is therefore considerably ahead of ecosystem execution.
That gap should matter to procurement because supplier networks are one of the areas where the function has influence that few others possess. Procurement sits at the intersection of internal demand and external capability. It can either reinforce organisational boundaries or help create the commercial mechanisms that allow value to flow across them.
The CPO mandate is becoming an operating-model mandate
None of this makes the transformation challenge easier.
The largest barriers identified in the study are organisational resistance to change, lack of skills and experience with agile methods and organisational culture being at odds with agile values. Insufficient training, inadequate management support and governance constraints also feature prominently.
The hard part is therefore not installing the technology. It is changing behaviour, authority, incentives, governance and ways of working around it.
That is why the report has particular relevance for CPOs.
Procurement is one of the few functions that routinely crosses almost every major organisational boundary. It works with business leadership, finance, legal, technology, operations, supply chain, risk and an external supplier market. Friction at those intersections is experienced by procurement constantly, even when procurement did not create it.
The function is therefore unusually well placed to see where the commercial system slows down.
The practical questions for leaders become more structural. Where does work spend most of its time waiting rather than progressing? Which decisions genuinely require executive approval and which could be delegated within clear policy? Where do procurement, finance, legal, technology and business stakeholders operate against different objectives? Which strategic suppliers should be involved earlier in requirement definition, innovation or problem-solving? Where can shared data eliminate repeated interpretation? Which controls manage real risk and which simply preserve historic process?
Those questions move procurement beyond functional transformation and towards commercial system design.
The benefits reported by organisations adopting new operating models suggest why that matters. Respondents cite improved decision-making, stronger business alignment, improved time to market, improved customer satisfaction and improvements in total cost of ownership.
The objective is not to abandon control for speed. It is to build control that allows speed.
It is not to remove governance. It is to make governance proportionate, transparent and capable of operating at the pace the organisation now requires.
It is not to eliminate procurement process. It is to ensure the process serves the commercial outcome rather than becoming an end in itself.
Ledger Series Media saw the same themes emerge while supporting the survey campaign. Direct engagement across senior procurement, supply chain, technology, transformation and leadership audiences repeatedly moved beyond AI itself towards governance, decision rights, silos, contracting models and cross-functional alignment. Nearly half of the completed survey responses recorded at that stage came through Ledger Series Media’s own campaign activity, giving the Group a substantial direct view into how senior professionals were approaching these challenges.
That experience reinforced why the State of Agility conversation matters beyond the report itself. AI may be the most visible catalyst, but the deeper questions concern how organisations are designed, how people collaborate and how commercial decisions move across functional and organisational boundaries.
For Procurement Ledger, that is the central implication of the 2026 findings.
The next procurement transformation will not be defined only by better sourcing technology, smarter analytics or greater automation. Those capabilities will be part of it. The defining shift will be whether procurement can help create a commercial operating model in which those capabilities translate into faster decisions, stronger alignment, better supplier collaboration and more adaptive value creation.
That is also why Ledger Series Media Group is supporting the discussion across its portfolio. The same operating-model challenge appears through different lenses in procurement, technology, supply chain and leadership. Through Ledger Series Intelligence, the Group will continue building on themes raised by the research through market insight, executive commentary and practical perspectives on the questions organisations are now confronting.
As Alexander Barron notes in the report foreword, technological progress is moving quickly, but lasting transformation continues to depend on people, leadership, collaboration and the ability to adapt.
For procurement, that may be the defining challenge of the next phase.
AI can accelerate work
The CPO opportunity is to redesign how value moves through the system.
Explore the full 2026 State of Agility in Procurement & Supply
The report examines business agility, operating-model redesign, AI adoption, organisational fragmentation, supplier ecosystems, commercial collaboration and the practices organisations are using to create faster, more adaptive commercial systems.





