Supply chain resilience
Supply chain resilience is "the capacity of a supply chain to persist, adapt, or transform in the face of change".
Origins
Around the turn of the millennium, supply chain risk management has attempted to transfer traditional risk management approaches from the "company" system to the "supply chain" system. However, the scalability of traditional risk management steps quickly reaches its limits: It is entirely possible to identify all conceivable risks within a company; However, a supply chain often consists of thousands of companies – the attempt to identify all possible risks in this system is therefore much more complex, if not in vain. It is a popular concept in contemporary supply chain management. It has therefore been argued that the complexity of supply chains requires complementary measures such as supply chain resilience. Resilience is able to cope with all sorts of changes and is thus less about the identification of specific risks but more about the characteristics of the system.Interpretations of supply chain resilience
Resilience in the sense of ''engineering'' resilience
For a long time, the interpretation of resilience in the sense of engineering resilience prevailed in supply chain management. It is implied here that supply chain is a closed system that can be controlled, similar to a system designed and planned by engineers. The expectations placed on managers come close to those placed on engineers, who should react quickly in the event of a disturbance in order to restore the system's ideal and original state as quickly as possible. A popular implementation of this idea in supply chain management is given by measuring the time-to-survive and the time-to-recover of the supply chain, allowing to identify weak points in the system. Acting like an engineer by redesigning the supply chain like on the drawing board, often by creating redundancies, strengthens resilience. In the short term, a supply chain can be viewed as a relatively rigid system. The idea of persistence of a supply chain that follows from engineering resilience therefore makes sense in the short term. However, this approach has mid to long-term limits. While the traditional engineering resilience approach in supply chains focuses on a quick response to restore the system to its ideal and original state after a disturbance, emerging perspectives suggest a shift towards a more proactive adaptation approach. This new viewpoint highlights the importance of not just reactive measures, but also proactive strategies like redundancy, flexibility, and adaptability to ensure the supply chain's persistent performance and adaptability in the face of disruptions.Resilience in the sense of ''socio-ecological'' resilience
Social-ecological resilience goes back to ecological resilience, adding to it human decision-makers and their social interactions. A supply chain is thus interpreted as a social-ecological system that – similar to an ecosystem – is able to constantly adapt to external environmental conditions and – through the presence of social actors and their ability to foresight – also to transform itself into a fundamentally new system. This leads to a panarchical interpretation of a supply chain, embedding it into a system of systems, allowing to analyze the interactions of the supply chain with systems that operate at other levels. For example, Tesla's supply chain can be described as resilient because it reflects the transformation from internal combustion engines to electric engines, which is based on the ability of human actors to foresee long-term changes in the planet in the context of the climate crisis and to implement them in a business model. In contrast to engineering resilience, the supply chain is not interpreted as a system that needs to be stabilized in a fixed state, but as a fluid system or even as a fluid process that interacts with the rest of the world.Recent studies and data have examined how the European Union firms responded to significant supply chain disruptions caused by the COVID-19 pandemic, maritime transport issues, and geopolitical conflicts. These events exposed the vulnerabilities of EU supply chains, particularly their reliance on foreign imports. Retail sector Since the COVID-19 pandemic, the global retail sector has experienced unprecedented disruption, with structural weaknesses of the complex supply chains revealed. The United Kingdom has had its fair share of retailers who have been under the critical pressures of shortages in raw materials, supplier breakdowns, geopolitical pressures and the move towards the faster digital retail channels. All these made the logistics and inventory flows predictable, which traditional profitability in the UK retail ecosystem was based on. The resultant turbulence showed that conventional efficiency-oriented supply chains were not agile enough to survive long term global shocks.
There is academic support that the pandemic led to a structural shift in the UK supermarket and retail industry. According to Khan, Alroomi and Nikolopoulos, the pandemic caused both demand and supply-side shocks concurring on procurement, transport and consumer behaviour in the UK supermarket industry. Their empirical research report revealed that increases in consumer panic buying and changes in online consumption increased upstream bottlenecks, whereas labour shortages and logistical fragmentation increased downstream inefficiencies. On the same note, Veselovská noted that initial phases of COVID-19 led to unstable ordering patterns and companies had to use short-term contingency models rather than strategy.
Supply-chain resilience is not only operational but existential with the case of a heritage retailer like M&S, which is spread out throughout food, fashion, homeware and online platforms. As noted in the Annual Report 2025, despite revenue of 13.8 billion and adjusted pre-tax profit of 875.5 million, the firm experienced a year that was all-absorbing as a result of a cyber-attack on the company that highlighted the vulnerability of even systems that have had a digital maturity. The management has clearly realised that outdated systems and sub-optimal logistics were still below industry-leading standards, which supported the necessity of structural renewal.
The British retail market is still under a significant threat of compounded risks. Roscoe et al. found that the geopolitical unrests like Brexit and the Russia-Ukraine conflict had redefined managerial supply-chain logics and compelled executives to negotiate between cost efficiency and resiliency via near-shoring and multi-sourcing. These macro-level variables go hand in hand with inflationary pressures that are conveyed via global value chains, in which bottlenecks in freight and components supply played a significant role in driving UK consumer prices to post-pandemic heights.
For example, in 2023 44% of EU firms that imported from China experienced transport and logistics challenges, while only 22% of firms that import solely within the EU reported similar numbers.
In response to challenges like these, trade patterns have shifted. The share of EU exports directed to the US increased to 21% in 2023, compared to a 14% in 2010. This is in order to mitigate risk and enhance supply chain resilience.