2025 was another challenging year for manufacturing and supply chains. In this Supply Chain Byte, Lisa Anderson highlights the three primary drivers of 2025: geopolitics, manufacturing investment and artificial intelligence with advanced technologies. Together, these forces are redefining how supply chains operate, where companies invest and how leaders prepare for what’s next.

1. Impact of geopolitics: Geopolitics has dominated supply chains as the Russia-Ukraine war continued on, impacting energy supply and costs, the war in the Middle East went to a crescendo with Iran-backed militia cutting off a critical supply chain chokepoint, the Suez Canal, and China threatening the world by cutting off rare earth critical minerals required for everything from defense to medical devices and communications. Refer to our recent article on the impact of geopolitics. Supply chains are retreating from globalization in a smart way.
2. Manufacturing recovery:  Manufacturing in the U.S. has been in recession for the last few years with backlogs dwindling over time; however, signs of hope are on the horizon. With the passage of the One Big Beautiful Bill, businesses can count on tax friendly rates and policies that encourage manufacturing investment. In addition, depending on the source, there have been announcements of $10-20 trillion of investments into manufacturing, shipbuilding, and data centers, thereby stimulating momentum. 
3. AI and advanced technologies: Artificial intelligence and advanced technologies utilized in SIOP (Sales Inventory Operations Planning) processes, inventory optimization, robotics, and other systems are enabling companies to keep up with competitive conditions and drive critical customer value while maximizing EBITDA. To learn more about how to drive smart supply chains and smarter decisions, download our complimentary eBook. 

Check out our Best of Supply Chain articles for best practices, critical highlights and trends, and what’s coming down the pike for manufacturing, supply chain, and technology. The best companies are resilient, innovative, and collaborative to thrive for decades to come.

If you are interested in reading more on this topic:
Maximizing Performance and Margins with SIOP