Building globally resilient value chains for sustained operations

From the November 2025 edition of Supply Chain Management Review.

November 2025

The November 2025 issue of Supply Chain Management Review explores the topics of global supply chain resilience, innovation leadership, and data-driven transformation. Highlights include strategies for building…

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The pandemic of 2020 has had a significant negative impact on supply chains affecting various aspects of trade, finance, and even societal growth. According to a survey conducted by the global management consulting firm Ernst and Young LLP, more than 57% of companies reported serious disruptions and 72% reported a negative impact. As the world started to recover and move back to some elements of normalcy, the Russia-Ukraine conflict began in February 2022, resulting in significant disruptions and shortages in the global food supply and logistical shortages in the Black Sea corridor. R. Jadav (2022) wrote that disruptions can also emerge from protectionist trade strategies during a crisis when producing countries prioritize supply for their populations, such as Indonesia’s brief implementation of an export ban on palm oil.

Food prices reached all-time highs in 2022 and 2023, and the cost of crude was also significantly affected, rising to over $127 per barrel in March 2022 before settling into a more normal range in 2024. However, a January 2024 article in Humanities and Social Sciences Communication by Qi Zhang, Yi Hu, Jianbing Jiao, and Shougang Wang illustrated that the Russia-Ukraine war resulted in a $37.14 increase in WTI crude oil prices and a $41.49 increase in Brent crude oil prices. Political interference, in many cases, uninformed and unwarranted, tends to escalate situations when international trade does not form the basis or even factor into discussions.

The past decade has shown us that there is only one certainty in the globally connected economy—we will remain in an environment of risk and lack of designs for sustained security for fundamental citizen needs.

Emmy Wassénius, Miina Porkka, Magnus Nyström, and Peter Søgaard Jørgensen found that risk and lack of designs for sustained security resulted in most of the world (127 countries and territories, 87% of the global population) achieving high levels of potential self-sufficiency (≥6 nutrients fulfilled), however only 33% of the world population (41 countries) are fully self-sufficient.

Supply chain management continues to evolve and designing for agility and resilience has emerged as one of the top priorities for all types of environments and even countries are focused on designing and maintaining adequate reserves for their citizens. Due to war, socioeconomic crises, natural disasters, and climate change, many developing countries are facing worsening issues related to food insecurity, whether it be malnutrition, disrupted food supply sources, or even starvation.

In this article, we present an iterative methodology and embedded framework that constituents should consider while developing global supply chains for agility and resilience.

The GRVC

What is a globally resilient value chain or GRVC? We will not discuss the base construct of a value chain in this article since many colleagues have authored thought leadership pieces that describe the latest thinking in the field. I often revert to the original concept that was introduced by Harvard Professor Michael Porter in his book “Competitive Advantage: Creating and Sustaining Superior Performance.” However, we will enhance the concept of an agile value chain with the overlay of resilience.

Global resilience is often described as the ability to address global issues through international cooperation, shared resources, and coordinated efforts. Utilizing the commonly accepted or understood definition of a value chain—we present the notion that a GRVC for an organization (for-profit, not-for-profit, or country) must possess the following guidelines listed in no specific order.

Must have design agility and operational flexibility. Addressing risk and associated resilience in a global context requires that the design framework utilized across all aspects of the major processes incorporate agile covenants and allow for modifications on an as-needed basis. There is an old saying that necessity is the mother of invention and when resilience is being tested—major design constructs may require deviation within allowed limits. So, each construct of the design-to-delivery process must be designed to accommodate agility for deviations and in the same vein allow for operational / implementation flexibility.

Must include the relevant coverage from human factors, process enablement, and advanced technology adoption across every value chain process involved in the design to delivery and orders to cash process(es). Resilience and risk management adoption must include detailed implementation plans involving the people responsible for the execution, the process steps that are to be used in the event of risk and stress, and the various advanced technology elements (ERP, advanced and intelligent response systems as well as predictive technologies) required to deliver the required results.

The end-to-end chain must be able to operate over extended periods using the 70/85 rule. Risks to the chain could occur with or without notice. Examples of risk could be geopolitical (will be with notice), component issues (with or without notice) or logistical route stoppage (with or without notice). Each risk event requires the chain to be resilient. However, the end-to-end chain must be designed to operate at 70% efficiency, span, and scale over long periods, and yet be able to deliver customer and consumer satisfaction at levels near a mark of 85%. The reason we highlight the two percentages at the levels listed above is based on many large-scale projects done over the past decade where risk elements had to be managed globally across various industry segments (including the global pandemic) and the resulting service levels that emerged to allow for disrupted and yet smooth operations without large long-term revenue and customer base erosion.

Must have elements of vertical and virtual integration. Global value chains for most environments will require the span and scope of infrastructure and processes to be designed, developed, and instantiated for operations. However, the capital investments required to create a complete end-to-end vertically integrated value chain are prohibitive even for the best-funded corporation/country. The design of the span will require a combination of vertical integration, joint ventures, and deeply rooted mutually beneficial partnerships that can be classified under virtual integration.

A virtually integrated environment is one in which partners operate as a unified entity without any formal investments but with operating agreements that are governed to deliver mutual benefits. The concept of virtual integration was introduced by the author in the 2010 book “Virtually Vertical—Pragmatic Guide to Streamlining the Corporation.”

Must be reevaluated every 5 years to 7 years for modifications and adjustments. Given that risk elements can be wide-ranging across the span and scope of the value chain, it is key that the chain
links and processes be evaluated, and mock-tested every five to seven years for evaluation and modifications. Additionally, the types of risk evolve and hence the types of sustainable activity and actions must also be incorporated or adjusted for the GRVC to remain relevant.

Must be owned and operated with a clear RACI. For GRVCs to be operationally ready, every link, process, and infrastructure must have ownership that is well-understood and documented. The RACI chart (responsible, accountable, consulted, and informed) and ownership of the various portions should be approved by the executive team and staffed appropriately so that operational deployment is efficient when the need arises. Too often, valuable time can be lost (which could result in losses of many dimensions) when there is confusion in the RACI and ownership of the vertical and virtual portions of the global value chain.

We should note that the implementation of the six guidelines does not guarantee success but serves as an enabler for smooth and efficient implementation of the GRVC in times of risk and stress. The resulting actions demonstrate the resilience of the GRVC and enable the entire system to learn and adapt over time.        

 

Dual impact structure

November 2022 Supply Chain Management Review featured an article titled “Build a Playbook to Implement Supply Chain Resilience” (authored by the same author as this article) and highlighted a framework that was relevant to applying constructs of redundancy to various aspects of the supply chain. The current framework should be viewed by readers as an overlay to the one presented in the November article to include aspects of resilience and global risk management by utilizing macro factors such as political posturing and economic policies.

The global resilience framework that we propose is a Dual Impact (DI) dimensional structure that has an outer layer and an inner core. The outer dimensions of I, E, D&D, and Ex serve as the fundamental building blocks for the resilience strategy that can be adopted by countries, regions, global corporations as well as other multinational entities, including mega foundations (such as Gates Foundation). However, the inner structure that comprises the triangle of politics and its ever-present impact on strategies and fiscal/economic policies can have a huge impact. Finally, the element of designing for a sustainable duration and impact is crucial to ensure that resilience remains at the core of the entity.

Let us now examine the Dual Impact framework in greater detail. The outer dimensions or the foundational layer is comprised of the following.

Identify (I). Resilience cannot be applied as a broad-brush stroke across all dimensions of an enterprise. It is crucial to approach the effort in a pragmatic yet impact-driven fashion. The team must start with the core mission/objective of the enterprise and attempt to list all elements that enable the mission. This can often serve as a guiding beacon for the identification process. The curated list can comprise product and service categories, customers and channels, regions of demand and supply as well as internal processes required to be resilient. The curated list must also assign relative weights for each element that is enumerated with a clear explanation of how the team arrived at the relative scoring.

In a recent project for an emerging bio-stimulant company, the identification process yielded the fact that of the 15 product lines serving four regions and seven customer segments, the highest relative weight/need for resilience existed for the core supply processes and partners used to serve three of the product lines in one region. The reason for this was primarily driven by the fact that the product group chosen was the one which had the highest level of IP (intellectual property) associated and the long-term future of the enterprise and its customers far outweighed the short-term gains/losses.

Enumerate (E). The process of enumeration is akin to the creation of business plans and business cases that have been in our lexicon for many decades. The difference in this enumeration process lies in the time phasing and the interconnectedness of the needs. The interconnectedness arises from the simple notion that end-to-end vertical integration in which every element of resilience will be owned and operated by the same entity is nonexistent. Every entity in our globally connected world must rely on partnerships to varying degrees. The enumeration interconnectedness facet must focus on details of the efforts that the partners will also accept and adhere to so that the whole system offers the same degree of resilience. The time-phased nature of the enumeration process must explicitly state the start date, the end date, total initial costs as well as ongoing maintenance costs required to sustain the level of resilience. Resilience as we have stated repeatedly is not a one-and-done exercise but one that must be sustained over long periods. However, as needs shift and change, we must also accept the fact that the relative rankings could shift, which would then imply the ongoing costs.

Many years back, I was working closely with an executive team from a leading consumer goods company providing food security-related items/staples in our day-to-day lives. The company was vertically integrated for approximately 70% of its needs for the entire order-to-delivery process. However, some key components inbound and outbound were entrusted to partners. During our enumeration process, I still recall the global CEO stating in one of our meetings in a very eloquent but insightful manner, “We can make all the investments and preparations but, in the end, the little ‘pimple on the elephant’s butt’ will affect all our efforts;” implying that the pimple was the efforts or lack thereof of the partners.

Define and design (D&D). The D&D phases must include all elements of infrastructure, processes, and human factors required for operations as well as supporting technology required for ongoing implementation. The needs for each component must be explicitly stated so that all parties gain a crisp and clear understanding of the roles and responsibilities in terms of the need for resilience.
We suggest the following:

• Define the problem/goal. Make sure the enterprise clearly articulates what needs to be solved or achieved.
• Conceptualize. Brainstorm and sketch ideas to solve the problem or meet the goal by utilizing all elements listed above.
• Simulate. Build an initial version of the end-to-end model.
• Refine and iterate. Adjust based on feedback and testing to improve the speed and quality of response.

Execute (Ex). The execution of a resilient design involves implementing strategies that allow systems, structures, or processes to withstand, adapt to, and recover from disruptions while maintaining their core functionality. The execution process must incorporate flexibility and scalability of the entire roadmap and include various real-time end-to-end simulations coupled with partial actual testing of subprocesses and responses. This type of testing has been conducted for years under war gaming and disaster recovery testing by enterprises and countries all over the world.

As we noted in the DI framework, the inner structure must be combined with the outer layer for the creation of the finalized resilience map. As I think back on the many years of helping global companies and, in some instances, countries develop resilience maps, I am reminded of incidents that occurred that affected the best-laid resilience plans. The incidents all centered on the inner structure areas with political and economic policies leading the way. I have had to deal with China changing import quality protocol while hundreds of thousands of metric tons of product sat at the ships and ports quarantined, incurring daily demurrage and holding costs. I had to work through the impact of foreign exchange impacts as the Japanese Yen lost heavily and suddenly to the U.S. dollar and the Euro to dollar hedges shifted. I recall a large trade in a Latin American country as well as the African continent where inflation and stagnation completely changed the dynamics of the local currency orders for export. One of the worst situations had the company needing to find alternate shipping routes and mechanisms due to the sudden insurgence of local politics causing regime shifts. As we often say, hindsight is 20/20 and over the years, I modified the framework to include the inner dimensions to create a more holistic and complete framework. In the world of management, the evolution of the resilience framework is like the additions and modifications that Dr. Michael Porter has made to the Five Forces framework by adding a sixth force and the combination of Five Forces with the PESTLE analysis developed by Francis Aguilar.

The inner dimensions comprise:

• Political (P). Political resilience for corporations and countries refers to the ability to navigate, adapt to, and thrive despite political change and disruptions. This resilience is increasingly vital in a world where political dynamics—such as policy shifts, regulatory changes, geopolitical tensions, and public sentiment—can significantly affect operations, reputation, and profitability.
• Economic (Ec). Economic policy resilience refers to the ability of a nation’s economic policies and frameworks to adapt and recover from economic shocks, disruptions, or crises while maintaining stability, fostering growth, and supporting societal well-being. It involves designing and implementing policies that can withstand and respond to challenges such as financial crises, pandemics, geopolitical tensions, climate change, and technological disruptions.
• Sustainable (S). Sustainable policy resilience refers to the capacity of policies to adapt, endure, and maintain effectiveness in the face of changing environmental, social, and economic challenges while promoting sustainability principles. This concept combines two critical elements: sustainability and resilience.

The GRVC framework, in similar fashion to other frameworks, is only as good as the overall context and ability to execute for sustained resilience. However, frameworks serve as a language that can be used to educate the various constituents who are participants in the virtual resilience mosaic. The ability to utilize the framework also allows for the ability to test for scalability and simulate modifications in near real-time. Frameworks also allow for appropriate metrics that can be utilized for long-term resilience. The usage of metrics drives accountability throughout the process and over long periods.

In the next section, we highlight a case study that was based on several years of work that my team and I were involved in to help in the development of a resilience strategy for a region.

Middle East case studies

The Middle East is often in the news for its dominance in oil production and, unfortunately, political conflict. What is often overlooked is the fact that the region imports more than 50% of its food production (in some years almost 60%) from various parts of the world—namely the U.S., Russia, Ukraine, Brazil, India, parts of the EU, and Canada. There are several projects ongoing in that part of the world to reduce the reliance on imports by encouraging sustainable agriculture practices, indoor food production, and other methods that conserve the shrinking water table. However, the population growth in the region continues to hover between 1.5% and 2% which is significantly higher than the global average. The U.S. alone exported more than $6 billion in agribusiness and related commodities to key countries in 2024 per USDA reports.

The high levels of potential turmoil within the region coupled with global conflicts (Russia-Ukraine conflict) have continued to be of major concern to the food resilience approaches that various governmental agencies continue to focus on. One such approach is the well-established public-private partnership models that have been implemented in the region successfully.

The case study highlighted in this article is a combination of several projects that were initiated by governments and successfully implemented in the Middle East region pre-pandemic and have proven to be resilient during the pandemic as well as withstanding the test of the recent Russia-Ukraine conflict. We have chosen to mask the details of the effort in this narrative but the GRVC framework (we did not refer to it as a GRVC framework during the projects since the framework was developed in current iteration recently) was implemented in its entirety.

We discuss each element of the framework as follows.

I. The process of identification of product categories for global resilience efforts was driven by the combination of multiple factors including but not limited to preserving shrinking natural resources, the need to focus on higher value in-region production as well as the need for technological advancement adoption. The resulting roadmap was heavily focused on private-public partnerships as well as the need for the region to develop hubs of asset ownership and joint ventures to allow for sustainable operations.

E. The enumeration process was extremely involved, and the economic models were built with the same types of ROI as mega capital projects. The span duration for amortization in many cases was more than 25 years. The mode included acquisition and JV as well as strategic partnerships for global assets of plant, property (including agricultural land), research centers, strategic stocking locations, and equipment (PP&E).

D&D. The design and definition phases involved several phases before execution. The definition of the effort was expanded to potentially include the ability for global commercialization of excess production and capacity as well as support regional resilience. Each product category was studied with baseline demand emanating from the Middle East region and overlaying global demand for the same category. The usage of global demand curves allowed for investments and joint venture placements to serve the host region as well as allowed for commercial operations built to enhance the impact of the region. The resulting investments in PP&E spanned various continents and set the stage for significant global cooperation at the diplomatic level, enabled by private-public partnerships. This design supported resilience while accounting for political and economic policy impacts over longer durations of time.

Ex. Execution for the GRVC probably ranks in some of the toughest projects that my team and I worked on. The projects spanned over a decade and involved traversing joint ventures; managing the transitions of government and family-owned/operated businesses to a corporate culture; optimizing processes across multiple cultures and languages, staff members who came from 17 different countries as well and dealing with lack of a combined technology platform. While these factors alone could serve as deterrents, the creation of a common strategic roadmap, lexicon of financial/operating metrics, and reward structures that were easily implemented served as an enabler for the successful year-over-year execution.

This case was heavily governed by several public-private partnerships. The inner dimension of political impact was governed by investments and ventures in countries that displayed generational affinity to the region as well as stable leadership and structures that were governed by democratic underpinnings.

Additionally, the need to maintain ongoing governmental dialog and relationships was a necessary ingredient for the success of the endeavor. The aspects of economic viability and stability were inherent in the design due to the geographic dispersion of the ventures and investments. Additionally, investments were backed by the appropriate combination of debt, equity, and governmental tax support to encourage investments. Finally, sustainability aspects were built into the investment portfolio for PP&E, process efficiencies as well as the operating model.

The risk-adjusted globally sustainable operating model for the chosen set of product categories and geographies that was designed and implemented over a decade (and continuing) continues to be used as a prime example of the implementation of forward-looking national, political, economic, and value chain resilience. 

Conclusion

While a few forward-thinking emerging nations initiated the journey toward global value chain resilience, the aftermath of the COVID-19 pandemic and geopolitical tensions disrupted and accelerated the effort. Several countries and global corporations adopted innovative strategies to mitigate future risks. These firms diversified their production bases, investing in facilities across North America, Europe, and Asia to reduce reliance on a single region. Additionally, they partnered with local governments to develop robust supply ecosystems, including raw material sourcing and talent development.

This multi-faceted approach not only fortified operations against potential shocks but underscores that resilience is not merely about bouncing back from disruptions but creating systems that anticipate and adapt to future uncertainties. As global challenges persist, such examples remind us that resilience is an ongoing, proactive commitment to value chain evolution.

About the author

Sumantra Sengupta, Ph.D., CTP, is a veteran practitioner, thought leader and educator in the field of global operations, resilience and turnaround management. He has served as a partner with several general management consulting firms as well as group president for a multinational food and feed security company with global operations across 11 countries. He now serves as the founding dean of the Rio Grande College of Business at Sul Ross State University in Texas. He has been a contributor to Supply Chain Management Review since 1998 and can be reached at [email protected] or [email protected].

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