Supply Chain Resilience in an Era of Trade Tensions
In uncertain times, supply chain diversification and operational excellence are imperative for corporate survival.
Written by Sean Indelicato | 8 min • June 11, 2025
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Global supply chains have always been vulnerable to disruptions. Typical shockwaves arise from natural disasters, strikes, or distinct geopolitical events. Today’s convergence of inflationary pressures, escalating trade tensions, regulatory shifts, and rising logistics costs are, however, forcing organizations to fundamentally rethink their supply networks. Once designed for cost-efficiency and speed, supply chains are now being tested for resilience and continuity.
The tariff rates placed on U.S. trading partners, China in particular, have swung widely. Though the U.S. and China came to a tentative agreement on May 11 to reduce tariff rates on each other for 90 days, the threat persists. Even a 30-percent tariff on Chinese goods (down from 145-percent) would be enough to compress margins and disrupt trade.
The result is general uncertainty. A threat itself.
This dynamic (especially the duties on advanced technologies imported from China) represents a significant shift in U.S. trade policy. While these measures aim to protect domestic industries and generate revenue for the U.S. Treasury, their far-reaching impacts are reshaping global supply chains and trade networks.
In this volatile environment, businesses that treat supply chain management as a catalyst for growth, innovation, and strategic leverage will be at a competitive advantage.
The Current State of Disruption: An Uncertain Reprieve
In response to American trade posturing, China has enacted export controls on essential minerals like gallium and antimony. With approximately 85-percent of global rare earth processing capacity centered in China, these actions create supply risks for industries ranging from AI and telecom to defense and advanced manufacturing.
While the stock market may appear optimistic on the surface, it’s the supply chain which remains the clearest early indicator of economic stress. To understand what’s coming, one should look not just at Wall Street, but at the industrial undercurrents:
Shipping Volatility: Ocean and trucking freight costs are expected to increase during the 90-day window to take advantage of pricing power during the surge. The influx of shipping comes from importers expediting orders before new, and potentially less favorable, policy changes take place. Increased tariffs also could spike aviation-based shipping rates and would the aviation supply chain, which is still recovering from the COVID-19 pandemic.
Price Increases: Even if the tariff rates are limited to 10-percent, that is a significant tax paid for by consumers and businesses alike. Some businesses are likely to eat the 10-percent cost increase as a means to stay competitive while others are expected to pass costs down to the customer, demonstrated for example by Walmart’s warning to its customers on May 15.
Manufacturing Relocation: Many companies are accelerating plans to shift and diversify manufacturing locations, often at a premium.
Companies with supply chains built on single-country sourcing are experiencing profit margin compression, production delays, and in some cases, existential threats to their business models. These disruptions foreshadow broader economic turbulence and underscore the need for structural resilience.
Uncover Supply Chain Data
On a macro level, IT/OT convergence is our best chance at managing worldwide challenges around supply chains.
What’s Coming, and What to Do About It
The next year won’t be defined by a single disruption but by a cascade of overlapping, mutually reinforcing shocks. Analysts anticipate accelerated tariff expansion, with additional product categories facing new or increased tariffs. Container shipping rates will continue their upward trajectory. And a clear separation between "Eastern" and "Western" supply chains will form for critical technologies and components.
In addition, analysts expect significant increases in compliance costs related to country-of-origin reporting, forced labor prevention, and other supply chain regulations as companies invest to prove compliance. Manufacturers have already begun stockpiling critical components in response, a trend likely to continue and create secondary shortages.
Organizations can approach this turbulence with both short-term and long-term strategies.
Short-Term Strategies (Next 3-6 Months)
Assess and Prepare: Conduct a comprehensive assessment and scenario planning of your supply chain's geographic concentration and identify critical vulnerabilities, then create detailed response plans for likely disruption scenarios, including alternative sourcing options.
Invest in Visibility: Use digital tools that provide visibility into inventory, in-transit shipments, and supplier performance in real-time.
Work with Integrated Partners: Prioritize vendors with multi-capability reach across sectors and regions.
Long-Term Strategies (Next 6-24 Months)
Reengineer for Resilience: Design high-quality products and processes for component and manufacturing flexibility, while investing in infrastructure that delivers reliability at scale. In a climate of constant disruption, systems built for uptime, security, and compliance become non-negotiable.
Expand Strategic Control: Build ecosystem redundancy through vendors who themselves maintain diversified operations across multiple geographies.
Embrace Complexity Management: Make supply chain agility a core internal capability, while creating a standard for simplifying both the supply chain itself and the products sold.
An Opportune Moment
Of the above strategies, it’s especially important to note that businesses with strategically diversified supply chains and access to integrated expertise will stand out as the most agile and adaptive. Resilient organizations share several key characteristics:
Ecosystem Integration: They build partnerships with diverse entities across their supply ecosystem, including suppliers, logistics providers, technology partners, and even competitors when appropriate. For example, auto manufacturers have created consortium-based approaches to chip procurement, sharing resources and information to navigate semiconductor shortages collectively.
Cross-Functional Knowledge Transfer: They actively import best practices from adjacent sectors. A medical device manufacturer can leverage aerospace engineering principles to healthcare challenges and identify hazards and improve patient outcomes. This holistic approach offers tailored solutions to their unique challenges.
Unified Solutions Architecture: They also approach supply chain challenges holistically rather than treating logistics, procurement, manufacturing, and distribution as isolated functions. This integration enables organizations to see connections between seemingly unrelated disruptions and develop coordinated responses.
This integrated approach, where a single partner can provide complementary capabilities across different business needs, creates natural hedges against supply chain volatility. When one channel faces disruption, another remains open. When expertise in one area is blocked by geopolitical barriers, alternative capabilities can be deployed.
As the Roman philosopher Seneca said, "The impediment to action advances action. What stands in the way becomes the way." Accepting this Stoic wisdom, companies can become catalysts for innovation and adaptation in the face of supply chain obstacles.
This article was originally published on June 11, 2025 at 12:31pm EST. This story is developing and will be updated.
Sean Indelicato
Market Insights Specialist
Sean Indelicato is a driven and ambitious market insights professional with a diverse background in engineering and business. With a passion for technology and an interest in international relations, he brings a unique perspective to his work.
The Array is a thought leadership publication curated by Hitachi Vantara, dedicated to exploring the intersection of data, technology, innovation, and leadership. The views, thoughts, and opinions expressed on this website are solely those of the individual authors and do not necessarily reflect the official policy or position of Hitachi Vantara or its affiliates.
