UBC Okanagan engineers have created an AI-based framework to help schedule orders, plan production and manage inventory under extreme conditions.
As global supply chains continue to strain under trade tensions, natural disasters and pandemics, researchers at UBC Okanagan's School of Engineering have created an artificial intelligence-based framework to help organizations build resilience efficiently and cost-effectively.
The study, published in Computers & Operations Research , presents an AI model that helps organizations make better decisions when facing uncertainty.
By combining operations research, machine learning and AI, the framework helps leaders decide how to schedule orders, plan production and manage inventory when conditions shift unexpectedly.
"Resilience is often discussed in broad terms, but our framework translates it into measurable financial decisions," says Dr. Mahsa Mohammadi, a lecturer in the School of Engineering .
"It helps decision-makers evaluate which strategy-whether multi-sourcing, consignment inventory or long-term contracts-delivers the best improvement in service level per dollar spent, even when tariffs, delays or demand changes come into play."
The team, which includes Dr. Babak Mohamadpour Tosarkani, Assistant Professor of Engineering, tested the model through a series of computer simulations of global disruptions such as supplier shutdowns, tariff hikes and shipping delays.
Their analysis showed that investment in diverse suppliers and coordinated inventory management reduced disruption costs by nearly 30 per cent and improved recovery time than those reacting after problems occurred.
Setting aside just 10 to 15 per cent of a company's budget to resilience measures-such as shared backup contracts or local production-significantly reduced overall risk.
Beyond business applications, the framework offers valuable insights for policymakers and funding agencies.
"Public investments yield the greatest results when directed toward the supply chain elements most at risk of failure," says Dr. Tosarkani. "Our model helps identify vulnerable components, suppliers or transport links, and guides decision-makers toward interventions that prevent system-wide disruptions."
The findings also highlight how common cost-cutting strategies-like bulk purchasing during tariff uncertainty-can actually inflate inventory costs.
Instead, the researchers suggest balancing purchasing policies with adaptive inventory management and greater data sharing among supply chain partners.
"Resilience should be viewed as a strategic strength, not an added cost," adds Dr. Mohammadi. "By using AI and optimization, organizations can measure how prepared they are and make stronger, evidence-based investment decisions."
