International trade is presently a 5 trillion dollar industry experiencing an automation revolution comparable to the revolution of the 1970s and 1980s that automated corporate financial functions using Enterprise Resource Planning (ERP) systems. The six most common reasons cited for the ERP revolution are: (1) need for a common platform (2) process improvement (3) data visibility (4) reduced operating cost (5) increased customer responsiveness, and (6) improved strategic decision making. Companies implementing trade management automation may expect similar results. A successful GTM implementation will optimize operational efficiencies, maximize automation, strip every unnecessary cost from current cross‐border processes, and deliver a positive return on investment (ROI).
Purchasing a GTM solution is a serious corporate decision. The price tag for GTM software alone can reach between $250,000 and $1,000,000 or more. In addition, implementation costs are frequently two to three times the software cost. Expenditures of this magnitude often require high‐level approval with an executive signing the purchase contract. When corporate executives spend this kind of money, they typically have gigantic expectations for operational improvement.
Here are four historical problems that create obstacles to success and erode the ROI for companies implementing GTM:
1. Expectations that a GTM will solve every problem and challenge in all business units around the world. A never‐ending or unrealistic list of requirements leads to budget and time overruns, unmet expectations, and angry bosses.
2. Lack of a clearly defined scope. What is the project expected to accomplish? When will various milestones be achieved? Who is the project leader and what authority does he or she have? What is each person’s role and expected time commitment? Ambiguity and vagueness lead to budget and time overruns, unmet expectations, and angry bosses.
3. Adding avoidable complexity. Companies implementing GTM systems for the first time often add unnecessary steps and make common, but preventable errors that create budget and time overruns, unmet expectations, and angry bosses.
4. Failure to integrate the GTM project to the overall enterprise. The lack of organizational and process integration misses opportunities to identify redundant or needless work, fails to eliminate unnecessary costs in the business, and leaves potential synergies unfulfilled
Multi‐national companies seeking to maximize the ROI of expenditures made in IT systems and the overall effectiveness of cross‐border business processes should select partners that specialize in the four success factors of GTM, providing the experience, resources, and team effort to deliver on‐time and on-budget implementation.
Four Success Factors of GTM:
1. Current, accurate, and digitized country‐specific trade data (content) including harmonized tariff schedules (HTS) for every country with up‐to‐date duties and taxes, importing and exporting regulations for every country, global sanctioned party lists, etc.
2. Company‐specific business data (content) with HTS classifications assigned to each item, for every country, with supportive rulings and other documentation stored with the item to meet the customs requirements of countries around the world.
3. Applications designed to automate import and export transactional processes on a global scale. GTM applications can provide automated connectivity of all parties of an international supply chain.
4. Integration expertise and experience to effectively integrate enterprise‐wide content and processes to maximize a company’s ROI from its investment in IT systems and enterprise applications.
Content, connectivity, and compliance are critical to international trade process optimization. More than ever before, governments around the world are requiring importers and exporters to file import and export documentation electronically which means global trade content must be reliable, digital, and integrated in GTM and other enterprise systems. Compliance requires accurate content, delivered to the right place at the right time. Any compliance failure can cause supply chain interruptions and stall the movement of goods.
Companies successfully implementing GTM can expect significant operational gains, comparable to gains achieved through their ERP implementations of the 1970s and 1980s. Assembling a team of trusted partners that specialize in the four success factors of GTM will maximize efficiencies, create the greatest automation possible, and strip every unnecessary cost from current cross‐border processes. Leveraging best‐in‐class country trade data, state‐of‐the‐art business data management and GTM integration expertise can help multi‐national companies maximize the ROI of expenditures made in GTM and IT systems and optimize the effectiveness of cross‐border business processes.
Nice Post, yes the international trade is becoming more and more tough with the competition GTR seems to be the good option as far as what I have got from your blog atleast.
GTM does look like the best option in this troublesome situation. Thanks for informing.