**USA**: ISM experts convene to address ongoing tariff challenges, the rise of agentic AI in supply chains, and innovative inventory management approaches. They highlight strategies for mitigating supply disruptions, leveraging technology, and recommend key literature for professionals.
Experts from the Institute for Supply Management® (ISM®) recently convened their monthly roundtable to discuss key issues impacting the supply chain profession, touching on tariffs, the emergence of artificial intelligence (AI), inventory management, and recommended literature for supply chain professionals. The discussion, featuring ISM’s CEO Thomas W. Derry, along with Jim Fleming, CPSM, CPSD; Paul Archiopoli, C.P.M., CPSD, CPIM, CMFGE; and Michelle Rohlwing, MBA, highlighted the evolving challenges and strategies in today’s complex supply environment.
Regarding tariffs, the panel acknowledged that although a recent “pause” on certain tariff increases caught media attention, significant duties remain in place, including a 10 percent tariff across various product categories, tariffs on imports from Mexico and Canada, levies on steel and aluminium, and substantial charges on Chinese goods. Derry characterised the current environment as a reiteration of long-standing tariff strategies, listing mitigation tactics such as bulk purchasing ahead of tariff hikes, supplier negotiations to share or absorb costs, shifting sourcing to tariff-exempt countries where possible, seeking substitute products, and passing costs down the supply chain. However, ISM data indicates that transferring tariff costs directly to consumers is less prevalent currently, with suppliers more often absorbing the impact.
Rohlwing put the historical context of tariffs into perspective, noting their roots dating back to the 1789 Tariff Act in the United States, and emphasised the heightened volatility creating significant pressure for supply chain professionals. She urged the importance of collaborative and creative solutions across end-to-end supply chains, underscored by preparedness through multiple contingency scenarios and the utilisation of emerging technologies for agility. Fleming observed that while tariffs have felt like a “roller coaster” of economic uncertainty, supply chains continue to adapt by leveraging experience from prior trade disruptions and the post-pandemic landscape. He encouraged supply chain professionals to adopt business-leader perspectives to develop innovative solutions.
Archiopoli shared an optimistic view grounded in his extensive five-decade experience, highlighting how today’s supply chain workforce benefits from advanced planning systems, purchase order automation, real-time tracking, warehouse automation, and enhanced data analytics. He stated, “Such examples include advanced planning systems, PO automation, real-time tracking, warehouse automation and holistic decision-making — all combined with amazing capability growth in data analytics and the technology that enables it. This combination of talent and technology fuels my unwavering optimism for the future of supply chains.”
Turning to developments in artificial intelligence, the panel analysed the potential of agentic AI—systems capable of independent reasoning and actions akin to human agents—in supply chains. Fleming described agentic AI as a key element of the emerging Fifth Industrial Revolution, characterised by collaboration between humans and advanced robotic technologies to improve processes, resilience, and sustainability. He said, “Supply chain organizations that learn to embrace advancing technologies such as agentic AI will be able to accelerate success,” while acknowledging the learning curve and challenges of adoption. Archiopoli highlighted the promise of agentic AI in autonomous planning, smart procurement, and near-real-time risk management but warned of increased risks including cyberattacks, data breaches, and accountability issues. Rohlwing discussed her experience with sales and operations planning (S&OP) and anticipated agentic AI’s potential to simulate scenarios and mitigate disruptions, while emphasising the necessity of governance plans and employee training to manage confidentiality risks. Derry concluded the segment cautioning that although agentic AI promises greater efficiency and data-driven decision-making, adoption may be gradual as trust in technology-augmented decisions develops.
Inventory management, historically a challenging domain, has been compounded by recent demand volatility and supply shortages. Rohlwing proposed leveraging AI and machine learning to analyse historical and external factors to forecast demand better, complemented by robust cross-functional sales and operations planning processes to improve communication and forecast accuracy. Fleming stressed the importance of “right-sizing” inventory to balance revenue opportunities with cost controls, urging leaders to seek comprehensive visibility across raw materials, work in progress, and finished goods to avoid sub-optimisation. Derry noted a notable shift towards valuing business continuity and revenue enablement over cost minimisation, a trend catalysed by pandemic-era supply disruptions and tariff-related stockpiling. He observed, “Many companies were scarred by supply shortages — and, frankly, learned a hard lesson about foregone sales and losing market share to competitors as a result of stockouts or finding a component or ingredient hard to come by.” Archiopoli advocated early adoption of advanced technologies such as AI-driven planning and procurement systems, dual sourcing to mitigate single supplier risks, and improved internal coordination to enhance inventory management outcomes.
In recognition of World Book and Copyright Day, the experts shared literature that has informed their understanding and practice of supply chain management. Fleming recommended the Certified Professional in Supply Management® (CPSM®) Study Guide and Professional Series, continuing to rely on these texts for foundational theories and concepts. Rohlwing recalled “The Goal: A Process of Ongoing Improvement” by Eliyahu M. Goldratt and Jeff Cox, praising its enduring relevance. Derry highlighted two academic papers— “An Empirical Analysis of the Effect of Supply Chain Disruptions on Long-Run Stock Price Performance and Equity Risk of the Firm” (2003) by Hendricks and Singhal, and “Supply Networks and Complex Adaptive Systems: Control Versus Emergence” (2001) by Choi, Dooley, and Rungtusanatham—that provide insights into the broader economic impacts of supply disruptions and the adaptive nature of supply networks. Archiopoli preferred classics such as “Manufacturing Control: The Last Frontier for Profits” (1973) by George W. Plossl and “Production and Inventory Management in the Computer Age” (1984) by Oliver W. Wight, underscoring the importance of understanding fundamental principles.
This roundtable reflects the continued complexity and dynamism within supply chains as they navigate tariff uncertainties, technological innovation, and evolving inventory strategies. The perspectives presented by ISM experts highlight both the challenges and opportunities facing supply chain professionals in the current global landscape.
Source: Noah Wire Services
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