Zach Zacharia and Gerry Angeli ’74 on 2026 1st Quarter Supply Chain Outlook

Photo by iStock/Suriya Phosri

In this episode of Lehigh University’s College of Business ilLUminate podcast, host Stephanie Veto talks with Zach Zacharia and Gerry Angeli ’74 about the 2026 Lehigh Business Supply Chain Index First Quarter Report. 

Zacharia is an associate professor of Supply Chain Management and director of the Center for Supply Chain Research at Lehigh. He teaches graduate and undergraduate courses in supply chain operations management and logistics and transportation. 

Gerry Angeli is the founder and CEO of Sterling Operations, and a class of 1974 Lehigh College of Engineering alum. He regularly contributes to and uses the report. 

Listen to the podcast here and subscribe and download Lehigh Business on Apple Podcasts or wherever you get your podcasts.

Below is an edited excerpt from the conversation. Read the complete podcast transcript [PDF].

Veto: Gerry, why do you contribute to the survey every quarter? 

Angeli: There are two main reasons. The first is some of my extracurricular activities include sitting on a couple of councils or committees, one of which is the Council of Economic Advisors. I speak on the topics of manufacturing, particularly in marine industries and supply chain. So when the survey first came out, it was perfect, because until COVID hit, nobody knew what supply chain meant. 

We've been shoveling products out of this country for decades. And now all of a sudden, there was a realization that we don't make anything. So, it was with keen interest that everybody wanted to hear what was going on and why. That made me be very prescriptive about completing and eager to see the results because the comments also point you in a direction. 

The second reason is, since I've been in Florida, the manufacturing responsibilities that I had included business continuity, which is important because we get our share of wind and water and other things that potentially can disrupt production. The supply chain is one of those topics and you have to be prepared for that. So that's the underlying reason why I'm so interested in what everybody contributes and what everybody says in the survey. 

Veto: You're a senior executive with over 20 years of international operations experience. Why is being able to look ahead so important for supply chain? 

Angeli: Because nothing happens currently in the supply chain. Everything that happened today was planned three, four, five, six months ago, if you're lucky. So if you haven't figured out how to get in place what you need to get in place-- and here's a simple example. Port strikes happen all the time. You should have already wired in your movement of materials that if one port goes down for whatever reason, you have an alternate. Not one that you're thinking of that day, but one that you've already planned for, that you can throw the switch on, and it can happen at your forwarder, or if you're a big enough company, you forward your own stuff. That pre-planning is what gives you an advantage. When everybody else is running around trying to figure out what to do, you already have it wired. It sounds like you need a clairvoyant. You don't. 

Veto: What’s going on with the first quarter index, Zach? 

Zacharia: There is an increase in risk. But, what you're really starting to see is that now there is uncertainty associated with the economy and government intervention and supply risk. These three risks were the ones that really sort of jumped up. 

The first thing that really jumped up that you have to think about is technological risk had the greatest jump of plus 7.55 points, from 62 to 70. I think there's a lot of anxiety about AI disruption, competitive pressures and this AI investment bubble. Everyone is a little bit worried about technology. This is the first time that technology has really had this huge jump into the 70s. Economic risk and cybersecurity risk– they've always been up there in the top two or three. This jump was kind of surprising. 

In this quarter, there is a real sense that people are starting to again get more worried about tariffs, inflation pressures and demand volatility. 77 is not the highest it has ever been, but it's pretty high compared to all the other years. 

And then there’s government intervention. People are really wondering what are some additional regulations perhaps that are coming in. So these kinds of pressures, increases in risk have definitely driven the overall risk. 

Veto: Do you feel that the overall increase in risk is to be expected or it's just the new normal? 

Zacharia: It has gone up by about a point from 67 to 68.7. So it is not the highest it's ever been. I think that this number is reasonable. The average risk is not really something I'm that interested in. It's the individual. 

Which component really has gone up in risk? Is it economic risk? Is it customer risk? Is it government intervention? So seeing this flip is interesting. One of the nice things about the report is that I provide three years worth of data. So you can actually look at that track. 

Economic risk in 2023 was at 87.97. That's a huge difference with our current number of 77.32. Right? Having these specific increases, it's better to look at what is the trend for the last three years. That will help you be able to make decisions based on what this change in risk is. 

Cybersecurity has been relatively flat for over a year. It's hovered around 77 to 78 in over a year. So that tells you what the risk has stayed over time. Government risk has fluctuated from 68 to 76. It went to 83 in the 3rd Quarter 2025 and was 65 in the 1st Quarter of 2024. 

Individually, different risks have jumped up into the first, second, and third positions. And that's what you really need to look at to help with decision-making.