Ashton Udall has a good discussion on why the Chinese are likely to copy your products and steal your Intellectual Property over on the Product Global blog (which was inspired by a posting on “Why Does China Copy Designs” on the Design Sojourn blog). The great thing about the post is he breaks it down into two major themes, each of which boil down to the same basic theme: culture, which I have partially discussed in my Is Low Cost Country Sourcing to China really Innovative, my Can China Be Innovative, and my Supply Chain Top Three posts. For those of you considering a new sourcing venture to China, I would highly recommend you check the post out.
Daily Archives: May 17, 2007
Global Trade Management 2007
Aberdeen recently released a research brief on “Global Trade Management in 2007” Benchmarking Trade Compliance, Global Supply Chain Visibility and Risk Management Practices in advance of their forthcoming study on Global Trade Management (with a scheduled release date of May 31) that highlighted this years focus in Global Trade Management (GTM): improving agility, trade compliance, and risk management.
This brief highlighted the alarming statistic that 90% of participants in the 2006 “Global Supply Chain Benchmark” study reported that their global supply chain technology was inadequate to provide the corporate finance organization with the timely information it required for budget and cash flow management. Thus, the importance of Supply Chain Finance (SCF), as highlighted in yesterday’s post should not be overlooked.
The brief outlines their Best-In-Class PACE (Pressures, Actions, Capabilities, and Enablers) hypothesis which they outlined as follows:
| Pressures | Actions | Capabilities | Enablers |
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Not a bad start, but I would hypothesize the following:
| Pressures | Actions | Capabilities | Enablers |
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My rationale for this is the following:
| Pressures | Actions | Capabilities | Enablers |
| Process visibility is good, as this allows you to improve your processes, but if you overlook key risks, your supply chain could still be brought to a grinding halt no matter how efficient your processes are | A good GTM process is enabled by the proper SCM systems, and these will need to adequately cover e-Sourcing, e-Procurement, and e-Logistics, as well as the appropriate areas of Supply Chain Finance and International Trade Management if an organization is to achieve efficient, paperless processes | Center-Led is better than centralization. As indicated in my weekend series over on eSourcing Forum last summer (Part I, Part II, and Part III) and in the Center Led Wiki, not everything is appropriate to centralized sourcing or management. A Center-Led organization allows you to centralize where it makes sense, and decentralize where it does not.
Don’t overlook engineering when evaluating key suppliers and supply risks – they will often know more from a product standpoint than the rest of the organization combined! It’s important to not only track the status of the carriers you’re using, but the inbound ports (of entry) you’ll be using as well. For example, if you are shipping ocean freight and the planned port of entry is expected to be hit by a hurricane, you need to be able to re-route the shipment. Also, if you have a choice between ports, sometimes its best to use the port with the fastest turn-around time if the items are perishable or the valuation is dependent on how fast you get the product to market. |
Don’t overlook spend analysis – it lets you know who you are spending with, how much, and when. This will help you identify key suppliers, carriers, ports, etc. that need to be addressed in your global trade and risk management plans. |