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5 Keys to Success in Emerging Markets

Sept. 11, 2014
Five supply chain factors play a vital role in a company’s success as it considers entering volatile but promising emerging markets.

Supply chain leaders take advantage of a variety of supply chain approaches to succeed in new markets, according to a new Accenture Global Operations megatrends study. The findings in “Supply Chain Success Factors in Emerging Markets” are based on a web-based survey of 1,014 senior executives of large global companies. These executives report gaining deep insights into target markets, extensively using technology and investing aggressively in key areas of their operations. These investments include expanding their physical infrastructure, driving operational excellence, adopting customer analytics to understand customers better and cultivating more partner relationships to extend their emerging-market reach and expertise.

Forty-six percent of leaders, versus 36 percent of others, plan to invest at least $30 million in the next two years on these initiatives. And leaders are nearly twice as likely as others to be planning to invest more than $40 million.

Lenovo, for example, developed a hybrid supply chain to achieve a leading position in a depressed global PC market. The hybrid model uses advanced segmentation and analytics to help reduce costs and improve delivery performance. In addition, Lenovo has eight in-house plants and 24 outsourced sites in China, Europe and South America. It has been able to create flexible operations and execute with increasing speed by keeping part of its production in house. As a result, Lenovo can mitigate potential supply chain risk with relative ease while accessing new markets through deep analytical understanding.

5 Keys to Success in Emerging Markets

  1. Include an effective integrated sales and operations planning process for key markets to ensure the company can achieve its customer service, time-to-market, inventory and cost objectives.

  2. Leverage a procurement, manufacturing, distribution and research & development network designed to deliver a quality product, in the scheduled time frame, meeting cost-of-goods sold and time-to-market goals.

  3. Povide tight links with customers and suppliers to enable improved demand visibility, customer service and reduced working capital and cost-of-goods sold.

  4. Incorporate logistics partnerships to ensure efficient and time-effective, low-cost sourcing and market penetration.

  5. Feature effective supplier recruitment, certification and alignment programs to ensure quality and service objectives in addition to cost.

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