SupplyChainTalk: The future of supply chain - what’s next and what’s needed

Views on news 

War in the Middle East is a growing threat to the global supply chain, already fragile after other recent geopolitical shocks and under pressure from the Trump administration’s tariffs, said Antonella Teodoro, an economist and analyst at freight and logistics consultancy MDS Transmodal. The Iran conflict is likely the most significant threat to global shipping and supply chains since COVID. Rising shipping costs could eventually be passed on to consumers.

 

Some of the world’s largest container shipping companies said they have halted several of their east-west shipping routes through the Suez Canal and the Red Sea, the gateway to the canal, due to safety concerns related to the war. Current events can be seen as yet another crisis, but also as another event that reveal supply chains’ geopolitical dependencies.  It also poses the question whether supply chains can remain efficient while increasing their resilience or is it a trade-off between the two? 

 

Can digital and predictive supply chains tackle volatility? 

 

In the context of volatile global markets and geopolitical uncertainty, the cost optimisation efforts of the past have morphed into risk concentration characterised by short-term deals, the disappearance of partnerships and transactional relationships. Despite the increased use of AI, fragmentation still prevails in supply chains. If digital twin adoption gathers pace in the next five years, businesses will be able to use them to mirror their supply chains and strike a balance between efficiencies and risk concentration. Applying AI to areas such as predictive model building, inventory management and demand planning can mitigate supply chain risk. But the human aspect also plays a key role in navigating volatile markets: discussions with key suppliers about lead times or mutually accepted KPIs. Nearshoring will also mean that these discussions and personal visits between supply chain partners will become easier and more frequent. Close engagement with suppliers and visibility beyond tier one is a more central issue than the dilemma of whether companies should adopt nearshoring strategies.  

 

Section 301 investigations launched by the U.S. Trade Representative (USTR) into 60 major trading partners, including the EU and the UK in March 2026, to investigate their failure to stop imports of forced-labour goods is adding a new level of complexity to redesigning supply chains. The key ingredients of supply chain resiliency are an awareness of regulatory requirements including sustainability criteria and the ability to find suppliers with the right technical capabilities, which are a good match for the business culturally too. This is the foundation for effective supply chain management, and choices between global and regional suppliers only come after this foundation is firmly in place.

 

How suppliers are selected is bound to change in the future as a result of deeper visibility into the supply chain and a better understanding of suppliers’ dependencies. As the social aspect of ESG is becoming more prominent, businesses must raise their suppliers’ awareness of the problem and train them how to spot it.  Governance mustn’t be ignored either, though – companies should pursue ethical practices and remain compliant. In five years, successful organisations will not only respond faster but will also see disruption before it happens and able to pivot and redesign before the actual shock hits.  

 

The panel’s advice 

• Businesses still see supply chain management as a department sending out purchase orders, while, in an ideal scenario, it should be strategic and have strong integrations with product engineering, marketing and sales.  
• Supply chain practitioners must become risk assessment experts to navigate a global market fraught with disruptions. 
• Winning supply chains won’t necessary be the cheapest but the most adaptable ones.  
• There are four steps leading to more resilient supply chains – regionalisation and near-shoring; building a new regional supplier ecosystem; enhancing transaction planning and risk mitigations; and expanding regulatory and compliance expertise.