It never shows up as a single line item, but complexity is quietly driving down profitability across the business. Learning to measure it—and manage it—may be the one lever CEOs still fully control.
Faced with disruption, most companies reach for one of two levers: costs or prices. Both are now delivering diminishing returns. Input prices remain elevated, supply chains are more fragile and customers are more price-sensitive—each compressing margins and making profitable growth harder to sustain. Per AlixPartners Disruption Index, three out of five companies are holding more inventory to buffer geopolitical and supply chain shocks. The pricing power that once absorbed these pressures has largely faded.
