How can companies reengineer and improve global trade activity?
By Staff -- Manufacturing Business Technology, 11/1/2005 7:00:00 AM
As global trade activity increases, finance execs say it's more challenging to gain a clear picture of projected cash flow, inventory, and hard and soft financial commitments. The difficulty is understandable given that international settlement processes are still paper-based at 60 percent of organizations, and are rife with invoice reconciliation challenges as well.
Yet a recent survey report from AberdeenGroup, The CFO's Agenda for Global Trade Benchmark Report, says improving the global trade process is among the top three corporate initiatives named by surveyed CFOs. These executives are reacting to the pressures outlined in the chart at right.
Aberdeen recommends that companies look to reengineer global trade processes in some of the areas that follow:
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Consider a paradigm shift from total landed cost to a "total delivered profit" mentality.
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Ramp up use of financial institution's trade services.
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Expand trade compliance and documentation foundation.
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Institute stronger financial oversight of supplier contracting and supplier financial condition.
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Leverage the value of inventory and orders within the global supply chain.
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Work toward a fully visible, primarily paperless environment.
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Take advantage of physical supply chain triggers.
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