Unlocking the Value of Globalization
Unlocking the Value of Globalization: Profiting from Continuous Optimization; developed by Deloitte Research, the study estimates that more than 80 percent of the world's largest and most complex companies studied are not capturing the full returns on their global investments. The global companies that have made the most inroads in continuously optimizing their global supply chain networks have been rewarded with significantly better bottom-line results.
As part of the Deloitte Global Benchmark Survey Program, the report is based on in-depth analysis of nearly 800 companies worldwide across multiple industries, including aerospace and defense, automotive, industrial and consumer products, life sciences, process, paper, chemicals, high technology, and telecommunications equipment. Together companies participating represent about US$1 trillion in revenues globally.
A key finding of the study is that, rather than take a holistic view in the design and expansion of their global networks most global manufacturers focus on fixing individual pieces of the network. The result: suboptimal improvements, wasted efforts, and frequently lackluster performance. Despite the dramatic changes taking place in global industries and the constant need for optimizing the business, only one in ten companies have made significant efforts to optimize its global networks over the last three years.
Our research revealed three things that distinguish the most profitable companies from the rest:
First, they optimize holistically ensuring a global view into both competitive (e.g. new markets, supply chains, and products) and compliance (e.g. new and existing regulation, taxation) drivers.
Second, they optimize early for every major new investment or restructuring.
Third, they optimize continuously and do not wait to do this every three, five or ten years. To do this well, they build an optimization infrastructure with people, process and technologies aligned to their globalization objectives.
With profit levels 50 percent or higher than their global peers, the top-performing companies show that pursuing "continuous optimization of the global network" is worth the effort.