As each industrial revolution has evolved, the next one is never too far to follow. From the 1920’s Age of Science and Mass Production, to today’s Digital Revolution, the industry is constantly changing. With the onset of globalisation, the consequences have had a heavy impact on the supply chain, and effective management of the supply chain has never been more critical.
The business world welcomed globalisation in the 1980s, as businesses began to explore the advantages of global markets. As technology continues to advance at a rapid rate, it has never been easier for businesses to extend their reach.
A world market offers businesses more opportunities to source a wider range of products and materials at a reduced cost and of higher quality. If mapped out correctly, this presents a competitive edge that can help businesses thrive. However, this level of expansion makes way for a more complex supply chain – for example, a business may be operating in the United Kingdom, with its production and manufacturing taking place in China or Mexico and its customers located all over the world.
Whether your international expansion involves acquiring new businesses or just simply entering a new market through local websites, the processes you have in place for an effective flow of goods ideally should withstand the challenges a new market can bring and not compromise operations.
Before entering into foreign markets, it’s important to gauge and understand the variety of differences in culture, administration, geography and economic distances into which you are planning to embark. You must first identify your business objectives in order to weigh out the full extent of opportunity.
Debbie Lentz, President of Global Supply Chain at RS Components and the Electrocomponents Group discusses the benefits of globalisation and the positive effects it has had on the workforce so far – and how this is only set to increase.
Effective communication and collaboration
The days of simple manufacturing assembly lines are gone. Suppliers and manufacturers have had to adapt dramatically to meet the needs of global markets – managing multiple product lines which can be located in different countries across different time zones.
A business’s success in foreign markets relies heavily on strong communication. Historically companies typically managed interfaces to direct suppliers and customers internally but, in today’s networked economy, that is no longer a viable option. Companies are now having to outsource and collaborate with external partners – and as a result are having to integrate their processes and systems for a smooth execution.
This collaboration requires sophisticated management, control and communication as, alongside this, businesses are also faced with language barriers to overcome.
Speaking on the subject Debbie adds:
“When building and maintaining clear communication across all of our networks, I’ve found the use of video calling and cloud storage to share documents to be extremely effective. By translating comms into six different languages we can ensure that we’re reaching and engaging with all of our employees in their preferred language. As a result of this, our multilingual workforce are able to break down language barriers, streamline communication and drive a motivated team.
It’s important businesses consider ways to easily transfer information across different networks, from country to country. This will not only provide better transparency throughout your supply chain but will also unlock stronger channels for better flow of goods”
Simplifying a complex supply chain
As the number of supply channels increases, so does the opportunity for errors. Without proper management and organisation, you can quickly lose track and spiral out of control. Supply chain management is one of the most important aspects to maintain for globalisation and having a strategic ecosystem is critical.
It’s important that full visibility of the supply chain is available at all times so that there are no gaps in service and any risks or issues that arise can be dealt with in real-time. Achieving this will mean the adoption of processes which support full collaboration of transport, inventory and more – as well as maintaining compliance with regulations.
Globalisation should also cover digital platforms
It goes without saying that without technology, globalisation would be non-existent – we just wouldn’t be able to reach new markets without it. Through the use of digital platforms and tools, businesses can sell in global markets whilst keeping their virtual teams connected in real-time.
“Utilising technology such as automation is effective to not only decrease operating costs but also drive productivity. Tools such as automatic storage, retrieval systems and packing machines are great to reduce steps and decrease complexity. By investing in distribution centres you can have the capability and capacity to underpin and develop on future growth plans.”
Creating a diverse workforce
Globalisation not only provides increased connectivity, growth and improved integration driving a business’ bottom line, but it also has huge benefits on the workforce.
Recent statistics reveal that a diverse workplace makes 19% higher revenue. Working across global markets opens opportunities to employ a more diverse team as it engages with a variety of different types of talent and encourages different perspectives to be introduced into the organisation.
Debbie shares her experience of managing a decentralised team:
“Whether you’re managing a team across the globe or a small team in one country, it’s important that you acknowledge and are respectful of the vast variety of different religious beliefs and cultural customs of your workforce. People of different backgrounds, races, and nationalities approach work tasks and human interactions in different ways. Companies that are inclusive are 1.7 times more likely to be innovative leaders in their market.”
Increases in cross-border flow of goods, money, ideas, and employees have been focal factors in the world of affairs for the past three decades, despite current political turmoil threatening the term globalisation as a whole. However, globalisation to date has presented businesses with the opportunity to streamline processes and provided the ability to improve and create a nimble supply chain, as well as grow a diverse and powerful workforce. A flexible supply chain will not only ensure a sustained merge into new markets but can put businesses in a better position to address any eCommerce trade changes in the future effectively.