Research

Q1 Poll: What’s Pressuring Supply Chains—From Cyber to AI

April 03, 2025

If the first quarter of 2025 proved anything, it's this: Supply chains are still on the frontlines of global disruption.

From a new U.S. presidential administration to escalating tariffs, AI integration, and cyber threats, supply chain leaders are navigating a complex and often contradictory environment. The disruptions are piling up—but so is the urgency to respond smarter, faster, and more strategically.

To better understand how companies are adjusting in real time, West Monroe launched the West Monroe Quarterly Supply Chain Poll—a recurring snapshot of sentiment and strategy from 250 U.S.-based industry leaders across manufacturing, retail, and distribution.

Here’s what we found in Q1—and why it matters.

Data Behind the Disruption: Get the Full Data Set

Our complete Q1 2025 Supply Chain Poll reveals what’s really happening in supply chains. Take a deeper dive into how leaders are responding to volatility—how they’re really viewing the Trump administration, treating inventory, investing in AI, and planning for what’s next.

Cybersecurity Edges Out Tariffs as the No. 1 Concern for Supply Chains

In a year when tariffs are back in the headlines, it’s striking that cybersecurity was the top issue named by supply chain leaders.

We see this as a reflection of just how unrelenting—and unpredictable—cyber risk has become. Attacks don’t just disrupt operations; they jeopardize customer trust, lock up supply networks, and invite cascading effects across logistics and production.

A notable example: the December 2024 ransomware attack on Blue Yonder, a leading supply chain software provider. The company confirmed it was investigating claims of stolen data after a cybercriminal gang took credit for the breach. The news rattled the industry.

Many organizations have realized that their cybersecurity posture is only as strong as their weakest vendor or third-party platform. For supply chain leaders, it’s not about IT anymore—it’s about operational continuity.

The Blue Yonder data breach was a wake-up call for the industry. If a major, well-known supply chain platform can be compromised, it reinforces that no organization is immune—and that’s likely influencing how leaders are thinking about their own vulnerabilities

Jeremy Tancredi

Partner in West Monroe’s supply chain practice

AI Is everywhere in the supply chain. ROI? Not So Much.

In Q1, 98% of companies said they had integrated AI into their supply chains—a number that would have been hard to imagine even two years ago. Most focused on inventory management (77%), demand forecasting, and logistics optimization.

But enthusiasm doesn’t guarantee payoff: More than a third cited demonstrating ROI as their top challenge.

What we’re seeing on the ground is a wave of AI-driven experimentation—and a growing gap between early adoption and real impact. Companies are investing, but many still lack the right tools, data foundation, or change management strategy to capture long-term value.

One client we worked with, a leading activewear wholesaler, had been drowning in excess inventory while missing sales due to out-of-stock events. By applying machine learning to 15+ years of sales data, we helped reduce excess inventory, improving forecast accuracy, and increase annual revenue by $200 million.

The opportunity is there. But unlocking it requires more than plugging in a tool.

Strategic Supply Chain Shifts: Inventory and Sourcing in Motion

Another standout finding: 89% of companies made supply chain changes in Q1.

Why the defensive posture? Because Q1 kicked off with a wave of uncertainty:

Donald Trump returned to office in January, sparking swift moves on trade policy
New tariffs on cars, Canadian and Mexican goods, and Chinese imports were announced in March—catching many supply chains off guard
Port congestion, tariff speculation, and raw material shortages further complicated global logistics

Business headlines throughout the quarter painted a picture of volatility: from 25% tariffs on foreign-made cars to warnings from Bank of America about "corporate paralysis" caused by tariff uncertainty. These forces put pressure on mid-market manufacturers to delay investments, pad inventories, and renegotiate supplier contracts.

Against this backdrop, many companies opted to bolster inventory and revisit sourcing strategies—hedging against tariff volatility and preparing for potential trade shocks.

But stockpiling comes with its own risks. Several clients we work with are now grappling with excess working capital tied up in inventory that may not move.

Inventory is always the buffer for disruption—but that only works if you can manage it efficiently on the back end.

Brian Pacula

Partner in West Monroe’s supply chain practice

A New Era of Supply Chain Leadership

This quarter’s data suggests a new era of supply chain leadership—one defined less by firefighting, and more by forward planning. The disruptions aren’t going away. But supply chain leaders are becoming more proactive, more tech-enabled, and more central to enterprise strategy.

It also means leaders can’t go it alone. We’re seeing increased demand for practical, ROI-focused changes to supply chains—whether that’s extracting real value from AI, reducing exposure to cyber risk, or building flexibility into sourcing strategies.

This is why we’re committed to tracking this data every quarter. The more we understand what’s happening inside supply chains, the better we can help build what comes next. Click here to download the full Q1 results.

About the West Monroe Quarterly Supply Chain Poll

The West Monroe Quarterly Supply Chain Poll surveys 250 industry leaders across manufacturing, retail, and distribution to track how they’re responding to disruption in real time. The survey is commissioned by West Monroe and fielded online by RepData LLC. Only director+ titles in U.S.-based companies with at least $500 million in annual revenue qualify.

West Monroe’s supply chain team is a group of experienced operators and technologists who help clients build smarter, more resilient, and data-driven supply chains. For questions about the poll, please reach out to the firm’s External Communication Director Christina Galoozis.

*The Q1 poll was taken March 18-24, 2025.

Q1 Poll: What’s Pressuring Supply Chains—From Cyber to AI

Data Behind the Disruption: Get the Full Data Set

Cybersecurity Edges Out Tariffs as the No. 1 Concern for Supply Chains

AI Is everywhere in the supply chain. ROI? Not So Much.

Strategic Supply Chain Shifts: Inventory and Sourcing in Motion

A New Era of Supply Chain Leadership

About the West Monroe Quarterly Supply Chain Poll

Volatility isn’t slowing down. Supply chains need a partner who can apply technology where it counts. See how our experts can help.

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$100M Savings from Digital Transformation

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Cybersecurity Edges Out Tariffs as the No. 1 Concern for Supply Chains

AI Is everywhere in the supply chain. ROI? Not So Much.

Strategic Supply Chain Shifts: Inventory and Sourcing in Motion

A New Era of Supply Chain Leadership

About the West Monroe Quarterly Supply Chain Poll

AI in Supply Chain Management Strategy

$100M Savings from Digital Transformation

2026 Mid-Market Manufacturing Outlook

Diligence Finds $50M EBITDA Opportunity