Source: The World Bank World Development Indicators
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Transcript of Source: The World Bank World Development Indicators
Source: The World Bank World Development Indicators1960.0
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Exports
GDP
Inde
x: 1
970
= 1
00
90% of global demand is not fully satisfied by local supply
Supply chains are driving growth in world trade
Globalization of Supply Chains(n=7,642 Companies)
2013 2018 20230
10
20
30
40
50
60
Series 1
25%
14%43%
Companies’Current SCMGlobalization
Companies’Expected SCMGlobalization
Companies’Expected SCMGlobalization
40
50
57
DellABB
Siemen
s
Anheu
ser-B
usch I
nBev
Arcelor
Mittal
Nestlé
Nokia
Unilev
er
Microso
ft
Skand
ia
Swatch
OMV Grou
pAmex
Cemex
FedEx
Merced
es0
5
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2523
22 2221 21 21 21 21
19 1918
1716
1514
13
Global Supply Chain Strategy17% in 2005 21% in 2013 25% in 2018
Conversion (Firm and SBU
Activities, Behaviors)
Global Supply Chain Management
Value Stakeholder Performance
Goals of Global SCMDevelop and maintain strategic and operational aspects of global supply chainsIdentify and leverage industry globalization drivers that affect global supply chainsHave knowledge of and leverage the worldwide infrastructure for global supply chainsManage coordination and integration of global supply chains
But most importantly,identify leverage points for
• Identify leverage points for:– Global logistics in global supply chains– Global purchasing in global supply chains– Global operations in global supply chains– Global market channels in global supply chains
How global is the industry? How global should the firm’s strategy be? How global should the supply chains be?
Need to educate the global marketplace(e.g., potential wasting of resources)
Not leveraging the global marketplace(e.g., potential wasting of market opportunities)
100%Globalized
100%Domestic
IndustryAverage
IdealStrategyAlignmentRange
Insura
nce
Cemen
t
Watc
hes a
nd C
locks
Indust
rial M
achine
ry
Credit C
ards
Compu
ter Soft
ware
Air Tran
sporta
tion
Electro
nic Equ
ipmen
t
Automob
iles
Compu
ter H
ardware
0
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62 64 6569 69 70 71 72 75 76
All IndustriesCurrent
All IndustriesIn Five Years
All IndustriesIn Ten Years
Cost Globalization Drivers
Inventory Positions
RawMaterials
Glob
al S
uppl
iers
Global Customers
Work-in-Process
Finished Goods
32.30% 17.94% 49.76%
23%
19%
19%
30%
9%
15%
15%
13%
52%
5%
12%
12%
10%
61%
5%
Purchasing Activities:The View by C-Suite Executives
Engage in domestic purchasing activities only
Engage in international purchasing activities
only as needed
International purchasing activities as a part of
SCM strategy
Global purchasing activities integrated across
worldwide locations
Global purchasing activities integrated across worldwide locations & functional groups
Level II
Level III
Level IV
Level V
Level I
2013 2018 2023
International Purchasing
Domestic Purchasing
Global Purchasing
70% 21 25%Global Supply ChainsGlobal Strategy
Explaining Performance
To stay competitive, companies need to increase the globalization efforts of their
supply chain by 25 percent in the next five years and 43 percent in the next 10 years.
Total Cost Analysis
Strategic AlignmentChain Coordination
Human Resources