In an era defined by escalating trade tensions and geopolitical uncertainties, global supply chains have become increasingly vulnerable to disruption. Researchers at the University of British Columbia Okanagan (UBCO) have illuminated a crucial strategy that extends beyond the conventional wisdom of diversification: the formation of strong and strategic international alliances. Their findings reveal that these alliances, involving formal partnerships such as joint ventures and long-term agreements, are essential to mitigating risks posed by political trade conflicts, particularly during periods of tariff impositions and diplomatic disputes.
The research, spearheaded by Dr. Amin Ahmadi Digehsara, Assistant Professor in UBCO’s Faculty of Management, emphasizes that managing global supply chains amid political instability requires more than just spreading operations worldwide. While geographic diversification has been traditionally viewed as a safeguard against localized disruptions like natural disasters or pandemics, it falls short when deliberate political actions such as tariffs or quotas come into play. Instead, Dr. Ahmadi Digehsara’s work underscores the necessity of strategic choices regarding facility locations, capacity allocation, and operation management, all orchestrated through robust alliances that can weather systemic shocks.
Global supply chains today are challenged not only by uncontrollable natural events but also by human-induced disruptions, which include sudden policy shifts implemented by state and non-state actors. These disruptions harbor the potential to cripple production networks and erode profit margins dramatically. The UBCO study categorizes such interruptions into two broad groups: natural disasters such as extreme weather events and pandemics, and human-caused disruptions originating from geopolitical maneuvers. This classification provides a framework for assessing risk and underscores the multifaceted nature of supply chain vulnerability in the 21st century.
The study, published in Transportation Research Part E: Logistics and Transportation Review, integrates a novel two-stage model developed in collaboration with Dr. Amir Ardestani-Jaafari from UBCO and Dr. Sam Aflaki of HEC Paris Business School. This model simulates the effects of strategic alliances on global supply chain resilience and incorporates long-term planning decisions including facility siting and capacity management. By analyzing both empirical and simulated data, the researchers demonstrate that incorporating alliances into supply chain networks substantially reduces exposure to geopolitical risks and enhances profitability, especially in volatile international markets.
One of the pivotal insights from this research is the quantifiable resilience afforded by strong alliances, such as those between Canada and the United States. Dr. Ahmadi Digehsara explains that such partnerships can amplify supply chain robustness by up to eightfold, shielding against the substantial profit losses that typically accompany political disruptions. Without these cooperative frameworks, even moderate supply chain disturbances can erode profits by as much as 20 to 30 percent, underscoring the high stakes for multinational corporations navigating current global economic landscapes.
The real-world implications of this research were starkly illustrated during the Trump administration’s imposition of tariffs, which abruptly altered trade flows and seriously impacted numerous industries. “The tariffs under President Trump showed the world how quickly trade policies can disrupt entire industries,” notes Dr. Ahmadi Digehsara. Companies with strategic alliances were equipped to pivot production and logistics, ensuring continuity, while those lacking in international partnerships suffered from sudden operational costs and uncertainty, illustrating the critical need for preemptive alliance-building.
A notable example cited is the automotive industry’s response to China’s 2018 tariff hike on U.S.-made SUVs. BMW, leveraging its joint venture with Brilliance Automotive, was able to adapt by localizing production in China, thus maintaining robust sales figures despite the new trade barriers. This contrasted sharply with other manufacturers without similar alliances, who faced significant challenges in sustaining market presence. Such case studies highlight the tactical advantage delivered by international cooperation in shielding firms from punitive trade measures.
Dr. Amir Ardestani-Jaafari further elaborates that the incorporation of strategic alliances into supply chain network design dramatically improves outcomes under worst-case political disruption scenarios. His analysis reveals that even a single alliance between two countries can elevate profits by nearly 50 percent. This underscores a transformative shift in how companies and governments should approach supply chain architecture, moving from isolated operational decisions towards integrated, alliance-driven strategies.
The researchers advocate a paradigm where alliances are not confined to governmental agreements but extend to private sector collaborations as well. Enterprises can safeguard their supply chains by forging partnerships through shared production platforms, joint logistics arrangements, and binding long-term contracts. Such proactive collaboration fosters supply chain agility and offers a buffer against the unpredictability of international trade policies, thereby stabilizing operations and protecting market share in uncertain times.
Moreover, the study highlights the economic efficiency of investing in alliances compared to traditional mitigation strategies like inventory hoarding. The data indicates that each dollar committed to cultivating strategic relationships yields disruption cost reductions two to three times greater than the equivalent investment in stockpiling extra inventory. This finding challenges conventional risk management practices and promotes a more interconnected, relationship-focused approach to global supply chain resilience.
The fragility of modern supply networks demands that companies evolve beyond reactive strategies. Instead, they must embrace flexible, systemic partnerships that enable rapid response to shifting geopolitical landscapes. As Dr. Ardestani-Jaafari asserts, those firms that prioritize building and maintaining these alliances will not only survive but thrive, ensuring continuous product flow and market access while supporting their workforce and customers worldwide.
As global economic interdependence deepens, the insights from this groundbreaking UBCO study herald a new blueprint for sustaining supply chain viability in an era of uncertainty. The emphasis on strategic partnership development reshapes the logistics and management playbook, providing a roadmap for resilience that is as dynamic and interconnected as the challenges it addresses. This research is poised to become a cornerstone reference for policymakers and business leaders alike, guiding the future of international commerce and global supply chain governance.
Subject of Research: Not applicable
Article Title: Geopolitical disruptions in global supply chains: The role of strategic alliances
News Publication Date: 7-Oct-2025
Web References: https://www.sciencedirect.com/science/article/pii/S1366554525004892#sec0014
References: DOI: 10.1016/j.tre.2025.104448
Image Credits: UBCO Photo
Keywords: Mathematical analysis, Mathematical principles, Mathematical logic, Equations, Applied mathematics
