Thriving in 2025: How consumer packaged goods companies can own the future

2025 is a wake-up call for consumer packaged goods (CPG) companies. It’s time to see your organization in a whole new way – as a living organism able to adapt, grow, and thrive, even in the face of disruption. This means going beyond surface-level fixes and addressing the root causes of problems – just as a doctor treats the underlying causes of illness and not just the symptoms.

Where should you start? With the lifeblood of your organization: the supply chain. The transition from linear supply chains to networked ecosystems is already underway – and it’s a game-changer.

In the past, linear supply chains operated like assembly lines: supplier A shipped to factory B, which distributed products to clients C, D, and E. While simple, this model is vulnerable to external shocks such as pandemics or geopolitical conflicts.

Enter the networked model which creates a more flexible and resilient ecosystem. With multiple suppliers, factories, and resources sharing the load, organizations can better withstand disruptions. When one link falters, others pick up the slack, ensuring continuity.

Beyond a healthy supply chain, there are some other areas CPG companies need to focus on in 2025:

• Migrate before it's too late
• Centralize, standardize, harmonize
• Apply generative AI (gen AI) strategically
• Put people first

The clock is ticking: by 2030, SAP will stop supporting its legacy ECC systems, putting businesses that rely on it at risk of major disruption. Migrating to SAP S/4HANA is no longer optional – it's a lifeline.

We've worked with companies across industries to successfully navigate the SAP S/4HANA migration. The benefits go beyond avoiding disruption: modern systems like SAP S/4HANA not only reduce risk but also support the agility and efficiency required for ongoing transformation.

For businesses that haven't started this journey, the time to act is now. Waiting too long could mean missed opportunities or falling behind competitors.

Centralization is evolving. Gone are the days when centralization was reserved for transactional activities. Instead of focusing solely on cost savings and efficiencies, today's approach requires CPG organizations to have a deeper understanding of their innate strengths and weaknesses. They must know not only where they need help but also what to keep in-house to stay competitive.

Centralizing knowledge-based expertise like IT, strategy, supply chain planning, customer experience, and analytics – functions critical to differentiation – means you can make sure they operate on standardized, harmonized systems for seamless collaboration and scalability. Getting an external viewpoint of where and how to centralize, and who best to partner with when doing so, can help CPG companies build resilience and a competitive edge.

Gen AI was the buzzword for 2024, and for good reason – it's revolutionizing supply chains, operations, and customer experiences. But businesses must approach it in the right way.

When it comes to gen AI, I've seen three common attitudes:

• Skepticism: "It's just a passing trend."
• Overconfidence: "This will solve all our problems."
• Strategic thinking: “Let’s start with specific goals and measure the results.”

  
  

The last mindset is the winning one. Businesses that start with specific goals and outcomes – whether it's improving inventory planning or demand forecasting – see the most meaningful results. Gen AI isn't a silver bullet, but when used wisely, it's a powerful tool for innovation.

In supply chain especially, gen AI is helping organizations build more predictive supply chains, through more accurate forecasting, for example – the insights gathered help employees make better and faster business decisions across every corner of the enterprise.

No matter how advanced your technology, people are the key to successful transformation. Every company needs to put employee and customer needs at the heart of decision-making.

Ask firstly: "How will this technology improve people's experiences?" I've seen this holistic, human-first approach lead to smoother implementations, greater employee adoption, and higher customer satisfaction.

In large enterprises, where business and technology leaders can feel a little distant from the end consumer, it can be a hard mindset shift to make. But it's essential for CPG organizations to achieve more meaningful and sustainable transformation.

2025 is the year to rethink how CPG companies approach transformation. By treating organizations as living organisms, we can build ecosystems that adapt, evolve, and thrive under pressure. Whether it's extending supply networks, migrating to modern systems, harmonizing operations, using AI thoughtfully, or putting people first, the steps we take now will determine future growth and longevity.