What Globalization Can Mean for Your Business

Murugan Krishnaswamy March 6, 2015

what-globalization-can-mean-for-your-businessAs a manufacturing initiative to reduce bottom-line costs, globalization is one of the most powerful strategies companies can use to set themselves apart in crowded markets. Enabling engineers to design and manufacture anywhere, closer to their customers and across multiple sites, globalization can generate as much as 50% of its RoI in a short span of 3-4 months.

For the most advantageous market standing, companies should improve the way their operations, processes and strategies are connected throughout manufacturing; as you may have guessed already, the best way to do this is by broad basing your view towards global product development.

What Globalization Entails

The following is drawn from one of B-WI’s recent case studies on globalization, in which a leader in the corrugating and sheeting machinery industry sought to shorten time-to-market, and sustain competitive pricing, through more efficient sourcing practices.

“BWI studied their requirements and worked on the manufacturing processes, and finally arrived at an effective, optimum process that would satisfy [the company’s] requirements…

BWI’s sourcing strategy was aimed at exploiting global efficiencies in production, which extended to identifying alternate supplier sources, utilizing buffer capacities, optimizing production, improving distribution decisions across an international network of facilities, and taking advantage of specific geographical talent pools.”

In this case specifically, the company was able to save 25-30% in annual development costs by reconfiguring their sourcing around a more sustainable, global perspective. Simplifying engineering and manufacturing, much in the same vein as lean product development, but more broadly implemented, is the essence of effective globalization.

This is what makes globalized development a strong product cost optimization (PCO) practice for companies with large operations, spread across various sites or with multiple product lines.

How Globalization Affects Product Cost and RoI

How does globalization provide value for manufacturing companies, specifically? Connecting various elements of manufacturing through globalization makes it possible for companies to improve:

  • Management across multiple manufacturing sites
  • Line predictability and part reuse
  • Spreading of design costs
  • Product performance, returns and aftermarket services
  • Rationalization across multiple regions
  • Product and part tracking across the globe

What provides globalization its greatest value is reduced time-to-market and improved management for international manufacturing. This can result in significant savings during development, and improve business continuity through global manufacturing (a factor that is essential to maintaining real marketplace advantage, as identified by 25% of manufacturers in a recent survey conducted by B-WI).

Globalizing your large-scale manufacturing tasks can help you improve the predictability and performance of your products, and cut time-to-market to far shorter (and more profitable) speeds.

Much like how other PCO practices improve floor-level efficiency, globalization can radically improve the way your company handles product development on the broad, international scale.

Product_Cost_Optimization_Approach

Topics Globalization Time to Market Business Transformation