Leveraging these capabilities,
international product movements can
be designed to minimize tax and tariff
implications and take advantage of
trade preferential agreements with
foreign countries. Global logistics
decisions are then made based on
greater consideration of the financial
supply chain impact. Ultimately,
transportation planning and execution
functions are tightly linked with
automated financial approval and
settlement tasks.
A more advanced area of Financial
Supply Chain Management relates to
development of a “tax efficient supply
chain.” While beyond the scope of this
report, total tax liability can be
significantly impacted by the country
from which a product is sourced,
where and when value is added to the
product, the physical flow of the
goods, and who takes ownership
when. As the total impact can be
substantial, supply chain leaders will
consider tax implications in the design
and execution of their global supply
chain strategies.
Global logistics leaders will closely link
the movement of cash and excellence
in the Financial Supply Chain to
expand trading partner relationships,
maximize profitability, and ensure the
flow of goods is not disrupted.
The Lack of Global Logistics
Technology Enablement
While not every one of these 10
capabilities may be appropriate for
every company’s situation, we believe
that together they provide a solid
framework for developing a strategic
plan for building out process
capabilities and technology support
across global logistics planning and
execution. By evaluating your current
capabilities and improvement plans
against this framework, it will help to
identify areas for improvement and to
prioritize investment in people,
process and technology.
There is simply no question that for
most companies, technology
enablement of global supply chain and
logistics processes is well behind other
areas of the enterprise and supply
chain operations themselves.
As analyst Dwight Klappich at Gartner
recently wrote, “Even sophisticated
companies that have more global
supply chain experience and were
early adopters have only automated a
small fraction of their global trade
operations.”3
There are a variety of reasons for this.
The growth of offshoring happened so
quickly, relative to most business
trends, that many companies were
knee-deep in the strategy and
execution before they could really
assess technology needs.
Similarly, the seeming potential of
substantial cost reductions from
moving to low cost country sourcing
alone seemed attractive enough that
many companies simply assumed the
benefit
Leveraging these capabilities,international product movements canbe designed to minimize tax and tariffimplications and take advantage oftrade preferential agreements withforeign countries. Global logisticsdecisions are then made based ongreater consideration of the financialsupply chain impact. Ultimately,transportation planning and executionfunctions are tightly linked withautomated financial approval andsettlement tasks.A more advanced area of FinancialSupply Chain Management relates todevelopment of a “tax efficient supplychain.” While beyond the scope of thisreport, total tax liability can besignificantly impacted by the countryfrom which a product is sourced,where and when value is added to theproduct, the physical flow of thegoods, and who takes ownershipwhen. As the total impact can besubstantial, supply chain leaders willconsider tax implications in the designand execution of their global supplychain strategies.Global logistics leaders will closely linkthe movement of cash and excellencein the Financial Supply Chain toexpand trading partner relationships,maximize profitability, and ensure theflow of goods is not disrupted.The Lack of Global LogisticsTechnology EnablementWhile not every one of these 10capabilities may be appropriate forevery company’s situation, we believethat together they provide a solidframework for developing a strategicplan for building out processcapabilities and technology supportacross global logistics planning andexecution. By evaluating your currentcapabilities and improvement plansagainst this framework, it will help toidentify areas for improvement and toprioritize investment in people,process and technology.There is simply no question that formost companies, technologyenablement of global supply chain andlogistics processes is well behind otherareas of the enterprise and supplychain operations themselves.As analyst Dwight Klappich at Gartnerrecently wrote, “Even sophisticatedcompanies that have more globalsupply chain experience and wereearly adopters have only automated asmall fraction of their global tradeoperations.”3There are a variety of reasons for this.The growth of offshoring happened soquickly, relative to most businesstrends, that many companies wereknee-deep in the strategy andexecution before they could reallyassess technology needs.Similarly, the seeming potential ofsubstantial cost reductions frommoving to low cost country sourcingalone seemed attractive enough thatmany companies simply assumed thebenefit
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