Disruptions caused by trade disputes, natural disasters, the pandemic and war in recent years have exposed the fragility of highly complex, low-cost supply chains.
The new byword for many procurement managers and organisations is resilience. But what does a resilient supply chain look like, how does it differ from its forerunners and what might this trend mean for Ireland?
A supply chain refers to all the organisations, people and systems (including suppliers, manufacturers, distributors, technology and information systems) involved in getting a product or service to market and the end consumer, explains Áine Brassill, partner, supply chain and operations transformation, at PwC Ireland.
“It is a process encompassing everything from sourcing the materials, the technology, the labour, packaging, distribution and marketing to delivering the finished product or service.
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“For example, take a packet of crisps. You have the farmer who grew the potatoes, the manufacturing process, the packaging and the marketing and distribution to the end consumer.”
As the world becomes more interconnected, supply chains grow increasingly complex – and more vulnerable to disruption, says Ronan Guest, partner, supply chain and operations, at EY.
“For example, natural disasters, such as the 2011 earthquake and tsunami in Japan which severely impacted automotive and electronics manufacturing, causing global delays and shortages. More recently, Storm Darragh forced the temporary closure of Holyhead Port, a key trade link between the UK and Ireland, disrupting the movement of goods.”
Geopolitical tensions further complicate global logistics. Conflict in the Middle East has cut Suez Canal traffic by 50 per cent, with ships rerouted around South Africa, increasing both time and cost, Guest says.
“Meanwhile, the war in Ukraine has slashed grain exports by nearly 80 per cent, pushing global prices upward and straining food supply chains,” he adds. “Cybersecurity threats also pose significant risk. Attacks on hospitals and healthcare systems can force healthcare professionals to revert to manual operations, delaying care and straining services. The 2020 SolarWinds breach compromised both government and corporate systems, highlighting the scale of potential vulnerabilities.”
In this shifting landscape, disruption is a constant – but so is opportunity. These challenges underscore the need for resilient, adaptive supply chains that embrace innovation, diversify risk and turn uncertainty into a driver of strategic growth.
A resilient supply chain in 2025 is all about being able to keep things moving – production, delivery, and service – even when there are unexpected shocks, says Pat O’Hara, managing director at Architectural & Metal Systems.
“Whether it’s a pandemic, energy price spikes or geopolitical issues, the idea is to have a system that can bend without breaking,” says O’Hara. “The old model was focused mostly on cost-cutting and efficiency; today’s supply chains are more about flexibility and visibility.
“Ireland is well-positioned within the EU to attract companies that are looking to shorten or regionalise their supply chains. In sectors like manufacturing, we might see more demand for local suppliers who can offer reliable lead times, sustainable practices and less exposure to global shocks.”
Artificial intelligence has been in use in supply chains for some time, says Guest. “Organisations have been using the traditional AI for demand planning and procurement for many years and they are exploring the use of generative AI in other areas such as process standardisation and last-mile delivery optimisation,” he adds.
“Even in the relatively new area of sustainability tracking and measurement, AI adoption is as high as 62 per cent, according to EY’s most recent study on supply chain sustainability.”
AI models can also be trained to help improve things such as efficiency and planning, making businesses more adaptable to change, says Guest: “One example of this is a biotech company using AI to run “what-if” scenarios, including global shocks such as the introduction of import tariffs.
“Logistics network design is another area where AI can optimise supply chain networks by considering warehouse locations, transport links and patterns of demand to give businesses the most efficient option. These changes help drive faster delivery windows, decreased costs and increased service levels,” says Guest.
Talent is also critical to supply chains, says Brassill. In a 2014 survey by PwC 25 per cent of respondents said they believed that severe talent and workforce shortages would increasingly disrupt supply chains by 2030, up from 15 per cent in 2024.
“However, just 4 per cent of companies said that they have fully transformed their supply chains by automating tasks and reskilling workers,” she says. “Half of the leaders reported that low-touch and automated order management and fulfilment is the most important capability to bypass workforce shortages. It isn’t just highly skilled and digital talent that is in short supply; leaders are also worried about filling jobs in logistics and transport.”
This is particularly relevant in Ireland where several companies have highlighted the challenge of finding staff, particularly in warehousing and transportation, says Brassill.
Additionally, she reports, few companies have adapted their supply chains to be more ESG-compliant.
“Companies must comply with ESG regulations, such as CSRD [the EU’s Corporate Sustainability Reporting Directive] and pending new EU supply chain regulations, which are complex and are posing new challenges,” she says.
