The Hackett Group’s research details the
need for companies to align the globalization of their business services
operations with those of their overall enterprise, in order to truly succeed at
their globalization efforts. Globalization of business services requires
dramatic changes to improve visibility of management information, in part
through expanded use of automation. But most companies lag far behind in this
area.
“Globalization is undoubtedly one of
today’s most important business trends,” says The
Hackett Group President
of Advisory & Research Services Sean Kracklauer.
“Companies understand that tapping into
emerging markets is a key to success in the future. This is driving the need to
focus outside of their domestic markets and truly globalize and standardize
their product lines, brands, customer and supplier bases, and business
processes. To accomplish this, they require both visibility and control, so
that they can understand their customer base, make the best pricing decisions,
and make the right choices regarding a wide array of opportunities and risks.
“But it’s pretty obvious that most companies
simply don’t have the ‘global DNA’ that they need to do this
effectively,” Kracklauer explains. “For example, companies understand the
value of having one view of the customer. But most don’t have the ability to
quickly see and understand what they’re doing across different parts of their
organizations, given the highly manual methods in use to compile information
from many different sources. Timeliness of financial performance and forecasts
information is an even greater challenge for most companies. Incredibly,
although we have been talking for years on the need to move beyond stand-alone
spreadsheets, they are still the primary forecasting tool in nearly three
quarters of companies.
“This continued reliance on spreadsheets
and manual data sourcing are preventing companies from moving to more
forward-looking analyses based on a wider variety of non-financial data
sources. The challenge is only compounded as companies further globalize their
operational footprint,” says Kracklauer. “As a result, companies are missing
opportunities, and are likely to get hit with problems that they could have
anticipated and mitigated otherwise.”
According to The Hackett Group’s research,
less than half of all typical companies have “near real-time” access to
customer information. Only about a quarter of all typical companies have
similar access to financial performance and forecasts. Similarly, less than 30
percent have “near real-time” access to supplier base spend volumes. In all
cases, globalization leaders show dramatically greater levels of access to near
real-time information, having access to all this information and more nearly 80
percent of the time, on average. Automation is one key strategy companies use
to achieve these results, with The Hackett Group’s research showing that
globalization leaders say they have “mostly or fully” automated key areas up to
50 percent more often than typical companies.
The Hackett Group’s research found that
while globalization leaders have already almost completely globalized their
brands and products and service lines, typical companies have only done this
about half the time, on average. But typical companies are hoping to increase
globalization in these areas by up to 30 percent over the next two to three
years. In areas such as supplier and customer bases, even leaders say they have
achieved significant levels of globalization only about half the time. But this
is still about twice as often as typical companies. Compared to typical
companies, globalization leaders also have much higher levels of
standardization across everything from marketing and R&D to customer
support, manufacturing, and sales.
The Global Operating Model Book
of Numbers research
also details the critical importance of governance, particularly in regards to
clearly defining decision rights across cross-functional end to end processes,
organizational spans, and ownership of specific activities to successfully
execute the design, build and running of processes through global process
ownership.
About the
Author
Patrick
Burnson
Executive Editor
Patrick
Burnson is executive editor for Logistics
Management and Supply Chain Management Review magazines and web sites. Patrick is a
widely-published writer and editor who has spent most of his career covering
international trade, global logistics, and supply chain management. He lives
and works in San Francisco, providing readers with a Pacific Rim perspective on
industry trends and forecasts. You can reach him directly at pburnson@ehpub.com
Source: http://www.scmr.com
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