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Operations - Integration at every stage 

International Strategy - Operations
The role of operational strategy is undergoing significant change. Gone are the days where the CIO was relegated to being the 'efficiency executive'. Instead, today's CIO is a catalyst for strategic value and a critical enabler of business strategy. In particular when examining your international strategy, operational decisions are impacted by the level of your business intelligence, management of the supply chain, resourcing decisions, logistics strategy and your overall organisational design. Understanding how best to structure these elements of your operations within international markets can play a pivotal role in marking your success or failure in these markets.

 

View our insights below to get the latest thoughts and opinions from KPMG experts on market entry options in the international landscape.

Sending employees overseas: A comprehensive checklist

Steve Wade

Director, International Executive Services

KPMG in the UK

 

When thinking of sending assignees for the first time to an office in an emerging market (eg Brazil, Russia, India, China etc), there are a range of topics a company should consider before the event.  Listed below are the typical (but not exhaustive) subjects which should be on a checklist and, in the coming months, we will be preparing articles to “flesh out” particular challenges which may be faced in various countries in the emerging markets.  At the end of the article is listed the names and contact details of the subject matter specialists within KPMG in the UK who can provide support and assistance on the various topics.

 

Read the full article (PDF 58 KB)

Asia's sourcing locations: What has changed and where do you look next?

Product sourcing is about striking a balance between speed, quality, and pricing, to meet the exacting demands of consumers.  While many hard goods, ranging from consumer electronics to furniture, are still being sourced overwhelmingly from China, apparel and footwear production is widely dispersed and more mobile.  Preferential trade terms have boosted exports from Cambodia and Bangladesh to the European Union, while Indonesia has tended to be a more popular sourcing destination for Japanese and North American buyers.

 

Countries in South and Southeast Asia should continue to attract interest as China relinquishes its position as the world's manufacturer of low-cost goods.  With minimum wage levels up to four times higher than those in othe rparts of South and Southeast Asia, China can no longer compete on a low-wage basis, although evidently it can still defend its position in many categories where it maintains an edge through productivity and the reliability of its infrastructure.

 

Click here to download the full report for further insights (PDF 2.53 MB)

KPMG’s Change Readiness Index: Assessing the level of change readiness within developing and emerging markets

In the current uncertain economic conditions, countries, businesses and institutions around the world are undergoing unprecedented change with new challenges and opportunities every day. Some countries, however, are better able to manage and mitigate the risks associated with change and capitalize on new opportunities.

 

There has been little focus on the concept of change readiness, and there are few reliable and appropriate measures to assess it. Recognizing this, KPMG International, in collaboration with researchers from the Overseas Development Institute (ODI), evaluated the need and opportunity for a new forward-looking index – the Change Readiness Index – to assess the capability of individual countries to manage change.

 

Click here to view the report and use the Change Readiness Index tool

Designing your supply chain for new markets

 Dr Mona Bitar Dr Mona Bitar

Partner

Operations Strategy Group

KPMG in the UK

 Tim Sarson Tim Sarson

Director

Tax

KPMG in the UK

 

With 62% of the global GDP $8.5 trillion forecasted expansion in the 5 years up to the end of 2015 coming from emerging markets (2), the opportunity is no longer simply a low-cost off-shoring option. 

 

The emerging markets opportunities are driven by growing population wealth and more demanding consumers. This explosion in demand and revenue growth coupled with the benefits of more localised and cost-efficient supply chain dominates the strategic focus for businesses, notably in consumer goods, and will continue to do so for the foreseeable future.

 

But with the backdrop of the uncertain global climate, companies need to address five considerations around their entry strategy: Plan, Buy, Make, Move and Sell.

 

Read the full article here (PDF 64 KB)  

 

The changing role of business intelligence

Eddie Short

Partner, Tax

KPMG in the UK

 

The current proliferation of technology and devices often means the issue facing an organization that is looking at entering the emerging markets is not one of too little data, but rather conversely, it is of too much. This ability to integrate external information with internal sources to facilitate more effectively support decision making was a major challenge for a large proportion of the CEOs who were focusing on using information to forecast scenarios.

 

It is widely accepted that there is any number of reports which provide a range of answers that can be adapted to suit a given parameter, however the approach to market entry is shifting away from simply finding data to support a decision. Now it is about ensuring that the organization has developed a robust market entry plan which can be delivered upon.

 

Read the full article here (PDF 39 KB)

Business Challenges: The end of ‘cheap China’?

Aman Wang

Aman Wang

Head of UK China Practice

KPMG in the UK

 

Multinationals are finding the operating environment tougher than ever and it is a popularly held view that China is no longer a cheap destination to manufacture goods and outsource services. We may therefore see a shift in the world’s production chain. It used to be that multinationals viewed China as a low-cost export platform, manufacturing goods in Dongguan or Wenzhou for export to the United States and Europe, and so helping to grow market share and even margins. Not any more: costs are soaring across China making the country an increasingly expensive place for business.

 

In this changing landscape, what are the biggest challenges for multinationals?

 

Click to view and download the latest insights (PDF 1.63 MB)
 

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High Growth Markets video

 

Watch the compelling new KPMG film on High Growth Markets to gain further insight and hear from our clients and our people on what it takes to succeed in the exciting BRIC economies.