Trade Compliance Becomes Strategic (2008 Year In Review)
Another interesting trend in 2008 is the maturing of the global trade compliance market (also known as Global Trade Management). Born in the mid-90s as ITC (international trade compliance), the category has grown up with demonstrable success from early adopters and a recent surge in interest from the “early majority”. And, the analyst community has started to ramp up coverage with various reports that attempt to dimension the category and identify the leaders.
Gartner: Developing an End-to-End Global Trade Management Functional Map
Forrester: Modern Global Trade in Tough Economic Times Requires Next-Generation Software Solutions
ARC: Global Trade Management Software Market to Grow 10.1% Annually
AMR Survey Data: The Quiet Revolution
AMR Survey Data: The Revolution becomes Evolution
Marsh: Unlocking Hidden Value in Global Trade Management
Aberdeen: Global Trade Compliance Priorities in 2008
As the Global 2000 supply chains are becoming more centralized, they are also revamping information systems to address the complexities and manage risk. Trade compliance decisions are shifting from more tactical “how do I screen for restricted parties?”, to more strategic notions of automation across all compliance domains. Characteristics of strategic trade compliance solution include:
- An automated export process that manages product compliance, sanctioned party screening, license management, document generation, and filing
- An automated import process that classifies products and manages admissability, establishes compliance purchase orders, manages supplier and logistics decisions at origin, visibilty to in-transit shipments, complies with new security regulations, pre-validates import entries, files entries and manages post entry reconcilliation and amendments
- An automated trade agreement process that manages all supplier parts, establishes campaigns to solicit suppliers to certify the origin of products, and qualifies duty savings across any number of preferential trade agreements.
- Trade content that deeply integrates with the trade execution system to support a higher level of automation across a number of content categories including denied party lists, classification, regulatory controls, documents, embargoes, rules of origin, and land cost.
- Running a compliant global process that is fully auditable (sleep well at night)
- Shifting your trade talent to more strategic activities by managing transactions “by exception”
- Eliminating “islands of automation” by centralizing compliance and retiring point solutions
- Reducing costs by generating and automatically distributing documents
- Responding faster to new security regulations such as Customs 10+2
- Supporting new direct procurement models that allow you to “go direct” to cut costs
- Pre-clearing Customs to reduce inventory and fines
- Leveraging trade agreements to lower total landed cost
