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The acceleration of global sourcing and selling activity and the increasing need to monitor multiple tiers of the supply chain to remain agile and cost competitive are challenging companies to rethink their business models and automation strategies for global trade. Companies participating in Aberdeen Group's global trade research report that the top two factors driving them to focus on improving their global trade management practices in 2007 are the need to more effectively manage growing international operations and distribution networks and the lack of critical supply chain process visibility. The top strategic action companies are looking to take is increasing their supply chain (logistics) agility - in order to be able to address the supply chain challenges faster and more effectively.
-Viktoriya Sadlovska, research analyst at Aberdeen Group
In May 2007 Aberdeen Group conducted a survey of 214 companies to benchmark their key priorities and strategies in global trade management (GTM) for the upcoming year. Enhancing trade compliance and global supply chain visibility emerged as the two key themes for the practical GTM improvement initiatives in 2007. About half of all companies cited them as high priorities in 2007 and early 2008. The third area targeted for improvement is supply chain costing, highly prioritized by 45 percent of "Best in Class" and "Average" companies. "Laggard" companies rank supplier enablement above supply chain costing, which indicates that they are still at earlier stages of taking real control of their global supply chain operations.
"Best in Class" companies are more likely to have instituted centralized supply chain process and knowledge management, formalized risk and lead-time management programs, as well as superior technology enablers that provide enhanced visibility and control over global trade transactions:
• They are twice as likely as "Average" and 3.7 times as likely as "Laggard" companies to be using a global supply chain visibility platform.
• Together with "Average" companies, they are twice as likely as "Laggard" companies to be using an export or import compliance automation module as part of their GTM technology platform, although the overall adoption of this kind of automation is still moderate.
• "Laggard" companies are twice as likely as "Average" and almost three times as likely as "Best in Class" to report that GTM at their companies is still manual/spreadsheet-driven.
• Overall, companies continue to struggle with GTM, with about one-third of respondents reporting that their GTM processes are still mostly manual and spreadsheet-driven.
The Transformation Ahead. Growing customer demands for better and timelier service are forcing companies-from large to small-to explore new ways of delivering value. Effective management of global trade processes is imperative for success in this highly competitive environment. For leading enterprises, the role of supply chain technology is now critical: it has been elevated from being an add-on support feature to the essential part of an organization's supply chain infrastructure that is now an important factor for establishing a company's competitive advantage.
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