Research

The global supply chain is learning to heal itself

New research finds that the global supply network is becoming more resilient not by getting bigger, but by becoming more regionalized.

Molly Loonam

2026-09-28

Globalization has made it easier than ever to conduct business, connect with suppliers and customers, and move food, technology, medical supplies, and consumer goods across borders. But that global reach also leaves supply chains vulnerable to disruptions, including pandemics, natural disasters, and geopolitical conflicts, that can trigger shortages, inflation, and profit losses.

"Globalization has brought the world closer together, which means that we, as consumers, are now able to buy a greater variety of goods at lower prices," says AT&T Professor and Regents Professor of Supply Chain Management Thomas Y. Choi. "But from a supply chain perspective, the world is connected more closely, and highly connected system structures are also highly fragile system structures."

Understanding how supply chains evolve in response to disruption is a key focus of Choi's research. His upcoming paper, "Regionalization of Global Supply Chain Networks: Evolving as Complex Adaptive Systems," investigates how global supply networks are adapting to become more resilient.

Nearly every organization relies on supply chains to source, process, and ship goods and materials. That makes the global supply chain a distributively coordinated system: a network of independent parts working toward a shared goal through information sharing and coordinated logistics. Its massive size makes it impossible to identify every supplier, carrier, and distributor within it. Through his research, Choi found that even for a network operating on a global scale, bigger doesn't always mean better, especially when the system is constantly changing.

"We engaged in this research to understand how supply chains, as a complex adaptive system, are responding to pressure to be more resilient and less fragile," Choi says. "We are, in fact, becoming modularized."

How the global supply chain operates

Supply chains have existed since people began trading goods, growing more complex with mass-production factories and transportation advances that enabled goods to move farther and faster than ever before. The network became increasingly globalized after Chinese Premier Deng Xiaoping opened the country in the 1980s, offering lower labor costs and access to 1.3 billion potential new customers.

"That's when globalization took off: when China joined the world's trade activities," Choi says.

Today's global supply chain is both a complex adaptive system, with many individual yet interrelated components that continuously respond to new patterns, rules, and regulations, and a self-managing system that adjusts to constraints such as consumer demand and environmental requirements while maximizing its own gain. The metrics businesses use to assess growth and sustainability, including return on investment and cash flow, also influence the larger system.

The network is so connected that even small business decisions can contribute to global supply chain patterns, which Choi analyzes using maritime transportation data.

"Since 80% of global trade happens over the ocean," Choi explains, "we can trace supply chain activities by tracing how ships move."

Better, but not bigger

As the global supply chain grows, it can also become more vulnerable to disruption. Choi says the key to resilience isn't continuous growth, but breaking the system into smaller, more flexible networks.

Modularity describes the shift from one highly connected global network to many more regionalized networks. Businesses that once sourced goods from across the globe now get more materials closer to home, reducing the risk of production delays and other disruptions that affect manufacturing and shipping.

Much of the supply chain information Choi uses comes from satellite data provided by cargo ships, allowing researchers to track ships' movements in real time and trace how goods move around the world. Using a ship's location and draught data — the distance between the waterline and the lowest point of the hull — researchers can estimate its weight and how much cargo it is carrying. Based on this data, Choi and his team estimate that the global supply chain began to modularize around 2016, a shift that accelerated during the pandemic.

Choi found that between 2016 and 2024, shipments to distant ports decreased by more than 70%. Instead, more goods were shipped closer to home while still crossing international borders. But this regionalization does not mean the world is becoming less globalized.

"Globalization is trade across borders, and that is continuing to increase," Choi says. "We're not becoming deglobalized. It's still happening, just in a different way."

How AI could sharpen forecasting

As AI evolves, Choi anticipates its greatest supply chain impact will be improving researchers' and companies' ability to forecast trends.

"Companies cannot tell the future," Choi says. "It takes time to set things up and produce anything, so they need to forecast by looking at past trends, interpreting those trends, and extending those trends into the future."

For many organizations, forecasting happens annually or twice a year. AI could make forecasting continuous, giving organizations more accurate short- and long-term projections. But Choi cautions that AI-enabled forecasting cannot prevent every disruption, since countless issues can affect product manufacturing and shipping.

"AI will impact what we do in supply chain management," he says, "but the future still needs to unfold for us to see how it goes."

What regionalization means for ports

Choi's research does more than show how supply chains are adapting; it also helps policymakers identify infrastructure investments and regional trade agreements that better align with current shipping activity.

Ports generally fall into two categories: inter-cluster hubs, which connect international supply chain networks, and intra-cluster hubs, which support regional logistics and local needs. Across 15,000 shipping lanes and 750 ports globally, Choi found that activity increased on intra-cluster trade routes and at intra-cluster ports, prompting those ports to expand their services.

"As the supply chain continues to modulate, or reorganize into smaller networks, we're simply informing policymakers what kind of supply network patterns are occurring at a global level," Choi says. "If a country or a company were to invest in an import operation, they would be better advised to invest in intra-cluster shipping activities."

A self-healing network

During the pandemic, many people questioned why lifesaving medical equipment, including personal protective equipment and ventilators, became scarce or difficult to source. Those shortages heightened awareness of the supply chain's fragility and the impact that network disruptions can have on human life.

The good news, Choi explains, is that this awareness helped accelerate modularization.

"The global supply chain, on its own, started to heal itself," he says.

Supply chain resilience is about more than producing products efficiently, meeting deadlines, and making a profit. It's about ensuring that the resources communities need to survive and thrive, including food, medicine, technology, and other essential goods, remain accessible during disruptions. In a world where shocks can quickly cross borders and industries, resilient supply chains are vital to protecting public health, human safety, and the economic stability on which society depends.

Supply Chain Research