The Illusion of Supply Chain Transparency
You can never really know someone!
You may know their favorite color, tidbits about their family, or even whether they are an ice cream cone or cup person.
But how well do you really know someone when circumstances change?
You can know someone for years. You know their habits, their preferences, their usual way of doing things. And then pressure arrives: a health setback. Plans change. Expectations are tested. You discover something you hadn't seen before.
The same is true of supply chains.
A long commercial history with a supplier provides a certain level of security. You know their market pedigree, their prices, their contract terms, and their lead times. You may even know how they typically respond when there is a delay in transit, a port closure, a sudden shortage, or a spike in demand.
But do you know what they depend on? And more importantly, what happens when those dependencies are tested?
Knowing how a supplier performs under normal conditions tells you little about how that supplier will perform under stress. A June 2026 UK Government foresight report on global supply chains makes a similar point. Businesses may understand where products are bought and sold, but have far less visibility into the layers of production and infrastructure that sit behind them. A vulnerability can therefore begin several steps upstream, long before the final product reaches the enterprise. And those vulnerabilities do not necessarily remain where they started. They can build, interact, and amplify as they move through the network. The supplier you know may therefore be only the visible part of the relationship. The more important question may be: what is your supplier dependent on?
The Visibility Cliff
Consider a simple example.
A company decides it wants to reduce its exposure to a cyber incident. Instead of relying on one data protection provider, it appoints three. On paper, that looks like diversification. Three providers. Three contracts. Three separate relationships. A threefold illusion of security.
But imagine that all three ultimately depend on the same underlying cloud infrastructure or cybersecurity technology provider. The company has diversified its suppliers. It has not necessarily diversified its dependency. That distinction was brought into sharp focus by the July 2024 CrowdStrike outage. A problem at one technology provider propagated across organizations through their interconnected technology environments. The visible relationships were different. The underlying dependency was not.
This is where supply chain risk becomes less about counting suppliers and more about understanding concentration. You can have five suppliers and one dependency. You can have ten suppliers and discover that they all rely on the same port, processor, country, cloud platform, raw material, or piece of critical infrastructure. What looks like diversification from the outside can therefore be concentration underneath. Rather than focusing solely on how well you know your supplier, you should determine what all your suppliers have in common.
The statistics reveal something else: the point at which your visibility begins to disappear.
McKinsey's 2025 supply chain risk research found that 95% of surveyed leaders reported visibility into Tier 1 supplier risks. Beyond Tier 1, that number fell to 42%. That is the visibility cliff, and what lies beyond it is often more significant than what you can see.
In 2025, China's restrictions on rare earth exports provided another illustration. The European Central Bank found that more than 80% of large European firms were within three supply chain steps of a Chinese rare earth producer. The companies did not necessarily buy directly from China. Their exposure existed further upstream, through intermediaries and products containing rare earths. The illustration is useful. Your supply chain may be more connected than your supplier list suggests.
There is a reason we often say that we do not really know someone until we have seen them under pressure. Think about David Banner, Bill Bixby's character in the classic TV series The Incredible Hulk. Most of the time, he is simply David Banner. Quiet. Ordinary. Controlled.
Then something happens. The pressure builds. His circumstances change. And suddenly, David Banner becomes the Hulk.
Your suppliers may have a Hulk moment too.
The supplier that performs perfectly when demand is predictable, transportation is available, and markets are functioning normally may look very different when a critical input disappears, a geopolitical restriction is imposed, or several customers suddenly need the same scarce resource. That is where the real relationship gets tested.
The challenge for business is that we rarely get the luxury of discovering these things gradually. By the time a hidden dependency reveals itself, the disruption may already be underway.
Some of the key reasons why supply chains lack transparency are that:
Information is withheld: The contract may involve only two counterparties, and neither party is necessarily obligated to expose the relationships that sit behind it, or confident that it is safe to do so. A Tier 1 supplier may also have little incentive to disclose its own suppliers if those relationships are commercially valuable or could eventually allow a customer to bypass them.
Information is fragmented: Databases and supplier management systems are designed to capture the counterparties companies interact with. They are not necessarily designed to reveal the network behind those counterparties.
Concentration is hidden: Companies are not always asking the questions that reveal interconnected relationships. Looking beyond separate relationships can reveal that apparently independent suppliers may ultimately depend on the same underlying source, infrastructure, or geography.
So how do we get better at understanding what sits beneath the surface before the stress arrives?
Perhaps we can learn something from nature. Animals have been dealing with uncertainty, competition, and survival for a very long time. They have developed some fascinating ways of responding when conditions change. There are a few lessons there for how we build supply chains that can withstand stress. Each of the three barriers to transparency has a counterpart in nature: a way that animals and ecosystems have learned to share, combine, or uncover information.
Information Diplomacy
When information is withheld, creating a reason to share can work better than demanding disclosure. Honeybees practice a fascinating form of collective information sharing. In a honey bee hive, scout bees search for food sources and return to communicate what they have found through the waggle dance. The dance conveys information about the direction and distance of a food source, allowing other bees to act on information gathered by an individual scout. There is an interesting parallel for supply chains. Information that is valuable to one participant can become far more valuable when it is shared with the wider network. The challenge is creating an environment where critical information can move through the supply chain without requiring every participant to expose commercially sensitive relationships. The objective is to ensure that information about a constraint, dependency, or emerging disruption can travel far enough through the network for someone to act on it. Consider contract clauses requiring disclosure of critical sub-tier dependencies.
Information Consolidation
When information is fragmented, the answer is to bring the pieces together. Wolves provide another interesting parallel. Individual wolves gather information from different parts of their environment. They communicate through vocalizations, posture, and scent marking. When the pack comes together, information gathered by individual members can contribute to a broader understanding of what is happening around them. This is similar to what happens inside organizations. Information exists across procurement, logistics, operations, risk, and supplier databases. Each function may hold a piece of the picture without seeing how those pieces connect.
Bringing that information together can change what the company sees. A supplier database tells you who you have a relationship with. A more connected database can begin to reveal the relationships, dependencies, and common exposures sitting behind them. Combining procurement, logistics, and risk data into one view enhances consolidation.
Information Transparency
When concentration is hidden, the answer is to look beneath the surface. In a forest, trees are connected underground by networks of mycorrhizal fungi that link root systems across the landscape. These networks are part of the complex relationships between plants and their surrounding soil environments. A supply chain can work the same way. The interesting point for supply chains is the network itself. What we see above the ground does not necessarily reveal all the relationships operating beneath it. The supplier you see may only be one node in a much larger network. We can start by asking suppliers which ports, cloud providers, or raw material sources they share. The truth is we have become very good at documenting the relationships we can see.
The harder question is whether we understand the relationships we cannot see.
Relationships can be shrouded by deception, hidden traits, or competitive posturing. Getting beyond that requires a process of discovery, shared understanding, and psychological safety to reveal what really exists. And perhaps that is the real challenge with supply chain transparency. We may know the companies we deal with. We may understand the contracts, the prices, and the expected performance. But until we understand what sits beneath those relationships, we may only know the supply chain as it appears on the surface.
Remember! Somewhere in your supply chain is a "Missus or Mr. Nice Guy." A David Banner: quiet and unremarkable in normal conditions. Perhaps it is time to unmask the Hulk that resides within your supply chain. Left untamed, he will burst upon you when the stress arrives.
Sources:
McKinsey: How global disruption is reshaping manufacturing supply chains
ECB: How vulnerable is the euro area to restrictions on Chinese rare earth exports?
GOV.UK: Global Supply Chains: A Foresight report on risk and resilience
Resilience Forward: UK Government report explores supply chain risk and resilience
Illustrations are AI-generated and used for commentary.
References to The Incredible Hulk (1978) are made for illustrative purposes; the characters are owned by Marvel and Universal Television..
No part of this publication may be reproduced, translated, stored in a database or retrieval system without permission from the author.
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