• Advertise
  • Contact Us
  • About Us
  • Supplier Directory
  • SCB YouTube
  • Login
  • Subscribe
  • Logout
  • My Profile
  • LOGISTICS
    • Air Cargo
    • All Logistics
    • Express/Small Shipments
    • Facility Location Planning
    • Freight Forwarding/Customs Brokerage
    • Global Gateways
    • Global Logistics
    • Last Mile Delivery
    • Logistics Outsourcing
    • LTL/Truckload Services
    • Ocean Transportation
    • Rail & Intermodal
    • Reverse Logistics
    • Service Parts Management
    • Transportation & Distribution
  • TECHNOLOGY
    • All Technology
    • Artificial Intelligence
    • Cloud & On-Demand Systems
    • Data Management (Big Data/IoT/Blockchain)
    • ERP & Enterprise Systems
    • Forecasting & Demand Planning
    • Global Trade Management
    • Inventory Planning/ Optimization
    • Product Lifecycle Management
    • Sales & Operations Planning
    • SC Finance & Revenue Management
    • SC Planning & Optimization
    • Sourcing/Procurement/SRM
    • Supply Chain Visibility
    • Transportation Management
  • GENERAL SCM
    • Business Strategy Alignment
    • Education & Professional Development
    • Global Supply Chain Management
    • Global Trade & Economics
    • HR & Labor Management
    • Quality & Metrics
    • Regulation & Compliance
    • SC Security & Risk Mgmt
    • Supply Chains in Crisis
    • Sustainability & Corporate Social Responsibility
  • WAREHOUSING
    • All Warehouse Services
    • Conveyors & Sortation
    • Lift Trucks & AGVs
    • Order Fulfillment
    • Packaging
    • RFID, Barcode, Mobility & Voice
    • Robotics
    • Warehouse Management Systems
  • INDUSTRIES
    • Aerospace & Defense
    • Apparel
    • Automotive
    • Chemicals & Energy
    • Consumer Packaged Goods
    • E-Commerce/Omni-Channel
    • Food & Beverage
    • Healthcare
    • High-Tech/Electronics
    • Industrial Manufacturing
    • Pharmaceutical/Biotech
    • Retail
  • THINK TANK
  • WEBINARS
    • On-Demand Webinars
    • Upcoming Webinars
  • PODCASTS
  • VIDEOS
  • WHITEPAPERS
Home » Just One in Ten Companies Has Completely Mastered Globalization, Survey Finds

Just One in Ten Companies Has Completely Mastered Globalization, Survey Finds

June 15, 2015
Boston Consulting Group

The findings are discussed in BCG's report, The Globalization Capability Gap: Execution, Not Strategy, Separates Leaders from Laggards.

The survey found that:
--  Companies have high global aspirations and confidence in their global strategies, but only about 10 percent have mastered the capabilities needed to win overseas. Mergers and acquisitions are critical weaknesses.

--  Line managers who run businesses or regions are much more pessimistic about their companies' global readiness than headquarters staff.

--  Mid-sized companies are at the greatest risk in going global. They are less nimble than smaller companies and do not have the scale or systems of larger ones.

"Companies clearly recognize the need to globalize, but few of them are truly ready to execute and bring to life their global strategies," said Dinesh Khanna, a partner in BCG's Singapore office and global leader of the Global Advantage practice. "Companies that want to win overseas should be focusing on the nuts and bolts of going global."

BCG and IMD conducted the Global Readiness Survey to understand the aspirations and the preparedness of companies to go global. About 75 percent of respondents reported that their companies plan to increase their international share of business. But only 10 percent believe they are mastering the full set of 22 capabilities required to go global.

Several practices essential to globalization, such as establishing a global supply chain and spreading best practices, rank in the bottom third of capabilities. Overall, respondents rated their companies below average on 15 of the 22 capabilities.

Global expertise in mergers and acquisitions was the lowest-rated capability by a wide margin. Its "readiness score" was 34 percent. (A score of 100 percent indicates that a company has perfected the capability.)

The survey uncovered, however, the potential of M&A in energizing a globalization journey. Companies scoring 75 percent or higher on M&A reported total readiness scores at least 10 percent higher than average.

"M&A can be challenging to master as it requires mastery of several skills, such as target selection, negotiation, and integration. But M&A can also be transformative. Companies can quickly acquire market share and a global footprint, diversify their talent base, and create a more varied portfolio of businesses," said Margaret Cording, professor of strategy and regional director of Southeast Asia and Oceania at IMD business school.

Headquarters Bias
The survey also found a disconnect between the views of executives who work at headquarters and those who work in the field. Headquarters staff have a far more optimistic view of their companies' globalization readiness than line executives. The biggest differences have to do with whether the organization has an open mind-set, aligned performance incentives to support the global agenda, and best practices effectively spread across the organization.

Size Matters
Small, mid-sized and large companies have similar globalization aspirations, but vast differences separate their readiness to globalize, according to the survey.

Most strikingly, mid-sized companies, with annual revenues from $1bn to $10bn, underperform their larger and smaller peers across most capabilities. They have neither the scale of large organizations nor the agility and effectiveness of smaller ones.

Large companies do better than mid-sized and small companies in core business capabilities such as setting up a global supply chain. But they do relatively poorly on capabilities related to learning and agility, leaving them vulnerable during periods of rapid change.

Small companies, on the other hand, are fleet-footed but have not mastered local markets overseas and may misunderstand their competitors abroad.

About the Survey
The 362 surveyed executives work for a wide variety of companies throughout the world. Slightly more than one-half, or 56 percent, work for companies based in Western Europe; 11 percent are at North American companies; 9 percent are at Latin American companies; 9 percent are at Japanese and Australian companies; and 6 percent are at companies in emerging Asian markets.

One-quarter of the respondents work for industrial goods companies; almost as many, 21 percent, work for consumer products companies; 15 percent work for technology, media, and telecom companies; and 6 percent work for either financial institutions or professional services firms. The remainder work in health care, energy, insurance, the public sector, and other industries.

A copy of the report can be downloaded by clicking here or through IMD's Research & Knowledge publications.

Source: The Boston Consulting Group

RELATED CONTENT

RELATED VIDEOS

Global Trade Management Business Strategy Alignment Global Supply Chain Management Consumer Packaged Goods
KEYWORDS Boston Consulting Group business model Business Strategy Alignment consumer packaged goods facility planning foreign direct investment Global Supply Chain Management Global Trade Management site selection Supply Chain Analysis & Consulting supply chain development Supply Chain Management: Business Strategy Alignment
  • Related Articles

    Companies Face Talent Management Challenges in Emerging Markets, Survey Finds

    Companies Quite Willing to Invest in Robotics, Automation Technology, Survey Finds

    U.S. Businesses See Growth in Trade Over Next Six Months, Survey Finds

Boston Consulting Group

Report: Supply Chain Efficiency Could Cut Food Waste by $700Bn

More from this author

Wake up to live
“Supply Chains in Crisis”
updates and the latest Supply Chain News!

Subscribe to our Daily Newsletter

Timely, incisive articles delivered directly to your inbox.

Popular Stories

  • INTERIOR OF A CHICKEN FARM, WITH WHITE CHICKENS AS FAR AS THE EYE CAN SEE

    Worst Avian Flu in U.S. History Is Hitting Poultry

    Food & Beverage
  • TWO FINGERS MANIPULATE WOODEN LETTER BLOCKS TO TURN FROM SHOWING THE WORD RECOVERY TO RESILIENCE

    Five Challenges to Supply Chain Resilience in 2023

    Supply Chain Visibility
  • A PERSON HOLDS UP A TABLET COMPUTER IN A WAREHOUSE, SUPER-IMPOSED BY A GRAPHIC SHOWING A COMPLEX WEB OF SUPPLY CHAIN ELEMENTS

    Three Post-Pandemic Actions for Repairing Global Supply Chains

    Data Management (Big Data/IoT/Blockchain)
  • A MAN IN A SUIT SHAKES HANDS WITH A WOMAN IN A HARD HAT, NEXT TO A STACK OF CONTAINERS

    Three Procurement Technology Evolutions for 2023

    Sourcing/Procurement/SRM
  • The blank stare of a child's eye who is standing behind what appears to be a wooden frame

    The Alarming Continued Rise of Modern Slavery in Supply Chains: How Procurement Can Help Reverse the Trend

    Sourcing/Procurement/SRM

Digital Edition

Scb nov 2022 sm

2022 Supply Chain Innovator of the Year

VIEW THE LATEST ISSUE

Case Studies

  • New Revenue for Cloud-Based TMS that Embeds Orderful’s Modern EDI Platform

  • Convenience Store Client Maximizes Profit and Improves Customer Service

  • A Digitally Native Footwear Brand Finds Rapid Fulfillment

  • Expanding Apparel Brand Scales Seamlessly with E-Commerce Technology

  • How a Global LSP Scaled its Security Program and Won More Business

Visit Our Sponsors

Orderful Yang Ming Alithya
Barcoding Blue Yonder BNSF Logistics
CoEnterprise Data Capture Deposco
E2open GAINSystems Generix
Geodis GEP GreyOrange
Here Honeywell Intelligrated IFM
Infor Inmar Keelvar
Kinaxis Korber Lean Solutions Group 2H
Liberty SBF Locus Robotics Logility
LogistiVIEW Lucas Systems MCA Connect
MPO Nvidia Old Dominion
OpenText ORTEC Overhaul
Parsyl PMMI QIMA
Redwood Logistics Ryder E-commerce by Whiplash Saddle Creek Logistics
Schneider Dedicated Setlog Holding AG Ship4WD
Shipwell Tecsys TGW Systems
Thomson Reuters Tive Trailer Bridge
Vecna Robotics Verity
Verusen
  • More From SCB
    • Featured Content
    • Video Library
    • Think Tank Blog
    • SupplyChainBrain Podcast
    • Whitepapers
    • On-Demand Webinars
    • Upcoming Webinars
  • Digital Offerings
    • Digital Issue
    • Subscribe
    • Manage Your Subscription
    • Newsletters
  • Resources
    • Events Calendar
    • SCB's Great Supply Chain Partners
    • Supplier Directory
    • Case Study Showcase
    • Supply Chain Innovation Awards
    • 100 Great Partners Form
  • SCB Corporate
    • Advertise on SCB.COM
    • About Us
    • Privacy Policy
    • Contact Us
    • Data Sharing Opt-Out

All content copyright ©2023 Keller International Publishing Corp All rights reserved. No reproduction, transmission or display is permitted without the written permissions of Keller International Publishing Corp

Design, CMS, Hosting & Web Development :: ePublishing