Technological Factors Influencing Global Expansion
1. Enterprise Resource Planning: Human Capital
Development, Supply Chains & Dynamic
Integration
Anitra N. Reaves
MGMT 6677
Walden University
2. Technology is the Single most greatest factor
impacting Global Business Expansion
• Technological innovation, adaptation and scalability will
increasingly become vital to effective and
effective financial, customer, operational & talent
capabilities
• One of the most prominent factors reliant upon greater
technological sophistication are the optimization and efficiencies
of a company’s:
• Enterprise Resource Planning Systems and Management
(ERP)
• Increased functionality of ERP will significantly impact a firms
and or industries ability to
• Improve Supply Chain Operations
• Attract develop & manage talent in specialized and highly
skilled areas
• Dynamically integrate organizational systems across a
• Wide, diverse platform
• Attentive to local needs, yet
• Based on a global operational footprint
3. Technological Factors Influencing Global
Expansion: ERP & Supply Chain Operations
• ERP systems are comprehensive integrated systems that are designed to
support diverse operations of organizational systems that interface with
one another.
• Researchers believe that the technological challenge will be in BRIC
nations and other emerging markets where a greater focus on shifting
from integrated to dynamic operations with multifarious supply chain
operations will be a core business competency in meeting global
expansion challenges.
• Logistical flexibility and adaptation is also a
challenge that can engaged with a
comprehensive and dynamic ERP platform
4. Technological Factors Influencing Global Expansion: ERP & Human
Resources Development & Management
• ERP Systems can provide value in improving HR functions in
managing talent resources of global firms. The Talent supply chain
is another form /extension of Supply Chain Management
• This is a vital capability for global firms
in expanding operations for firms as
they will need to source:
• Highly skilled workers,
management teams and technical
professionals to:
• Innovate dynamic logistical &
trade systems and operations
• Develop comprehensive
communication networks to
support them.
5. Technological Factors Influencing Global Expansion: ERP & Competitive
Advantage
• Data & Information systems continue to be an essential resource
and tool for generating knowledge, innovation and assessing risk
• Information alone will not confer a competitive advantage
• Information that leads to knowledge acquisition and enables the
ability to inform business intelligence is vital to strategic decision
making
• Strategic decisions based on data and
sound knowledge make the difference
between leveraging a competitive
advantage or not, especially when
competing globally
• High Performance ERP platforms can
enable and support strategic
capabilities
6. References
Global Expansion. (n.d.). In My Own Business. Retrieved September 20, 2015, from Leavey School of Business
website: http://www.myownbusiness.org/global_expansion/
Global logistics: Challenges for expansion into emerging markets. (2013, July 1). In Logistics
Management. Retrieved September 21, 2015, from Peerless Media, LLC website:
http://www.logisticsmgmt.com/article/global_logistics_challenges_for_expansion_into_emerging_market
s
Kapoor, B. (n.d.). The impact of globalization on human resources management. In JJMS Journal.com. Retrieved
September 20, 2015, from JJMS Journal website: http://www.jimsjournal.org/6%20Bhushan%20Kapoor.pdf
LaFramboise, K., & Reyes, F. (2005). Gaining competitive advantage: From integrating enterprise resource
planning and total quality management. Journal of Supply Chain Management, 41(3), 49-64. Retrieved
from http://sfxhosted.exlibrisgroup.com/waldenu?url_ver=Z39.88-
2004&url_ctx_fmt=infofi/fmt:kev:mtx:ctx&ctx_enc=info:ofi/enc:UTF-8&ctx_ver=Z39.88-
2004&rfr_id=info:sid/sfxit.com:azlist&sfx.ignore_date_thresh
A renaissance for ERP and why it matters. (n.d.). In IBM.com. Retrieved September 21, 2015, from IBM website:
http://www.ibm.com/midmarket/us/en/att/pdf/FV_ERP_091712.pdf?ca=fv1209&me=feature2&re=usart
pdf
Talent supply chain management. (n.d.). In KellyOCG: Outsourcing and Consulting Group. Retrieved September
20, 2015, from Kelly Services website:
http://www.kellyocg.com/Solutions/Talent_Supply_Chain_Management/
Editor's Notes
A description of at least two of the technologies that have most affected the company’s or industry’s global expansion.
ERP: An advanced more dynamic form of Enterprise Resource Planning systems and management will be needed to effectively meet and manage global business expansion as we move forward to a greater increased dependency on technological innovations to; collect, organize and interpret data; to optimize efficiencies in supply chain operations; to provide greater insight into consumer behavior & manage customer relationships and to leverage competitive advantages that come from having a qualified, capable and knowledgeable workforce as well as top management teams. Pfeffer (1994) and Prahalad, (1983), as cited in Kapoor (n.d) “an organization‘s talent can be a source for a sustained competitive advantage and can affect important organizational outcomes such as survival, profitability, customer satisfaction level, and employee performance (p.1).
Business & Organizational Communications:
A second technology which is inextricably linked to effective and efficient ERP systems are optimized and fluid business & organizational communications; as international firms rather operating globally or regionally need to be able to communicate to a diverse population of employees, project teams, functional management colleagues, supply chain partners, develop & manage logistics as well as transportation networks; engage and respond to customer needs & feedback, improve products, goods & services, and be able to share, network and management knowledge & information that is sensitive to cross-cultural communications in an inter-culturally intelligent fashion.
Kim & Wright (2013) “In interviews with more than 250 senior executives of Asian companies, we found that only 28 percent said their revenues and profits from international markets had fully developed in line with expectations over the past three years. Executives also indicated that a major concern was the “human side” of international business: securing talent, building a global mindset, and managing cross-cultural communications.” Lastly organizational communication(s) assist in facilitating access to the information needed to assess, manage and mitigate risk, develop sound business strategy provide vital dialogues that are necessary to negotiate and maintain the proper relationships as it relates to cultural, administrative, geographic and economic distance, i.e. CAGE which impacts and influences companies in diverse ways (de Kluyver, 2010).
“Globalization is made possible by the development of cost effective, yet very powerful technologies, including the Intra- and Internet, enterprise resource planning system, data warehouse, data mart, and data analytics,” (p.2).
An analysis of how the technologies have facilitated global expansion
ERP systems and the various nested technologies and technological capabilities that they offer create an opportunity for business to capitalize and leverage on a unique value proposition as being the swiftest and adaptable to business, environmental, social and competitive change. In the evolution of ERP systems, they have undergone change themselves as they have adapted to meet the ever evolving needs and demands of a globally ‘expanding’ world. What used to be an expensive, loathe-some to execute and manage-- business, information and decision support system; ERP’s now offer increased functionality and compatibility across a variety of business platforms, industries and organizational size. Cost to manage and implement have decreased and new technological capabilities like ‘cloud computing’ and packaged suites have provided significant support and operational flexibility to ERP systems. According to IBM (n.d) “Midsize companies in particular are finding that today’s ERP solutions involve shorter engagements and less risk. Cloud computing, for example, has opened up ERP to many companies that may have previously viewed the software as too expensive and labor intensive to install and manage.” Companies today can take advantage of preconfigured, templated ERP solutions that are built based on industry-specific best practices and country-specific requirements,” (p.1).
ERP & Supply Chain Operations:
ERP’s typically integrate customer relationship management, human resources, financial management, supply chain and other internal business processes such that intelligent business decisions can be executed, performance can be measured and overall effectiveness can be gauged. ERP’s enable businesses to see how they are performing across a multitude of dimensions such as global supply chain management which is critical in managing global relationships, sourcing quality materials, developing appropriate revenue growth management strategies, developing human resources and talent; which overall can support a more optimized total quality management framework. Laframboise & Reyes (2005) “TQM is a holistic philosophy of management that requires the organization to continuously seek improvement in every activity, every function, in every process, (p.49)
A sweeping one dimensional supply chain strategy will not be maximized to meet the variability in situation context everywhere a company conducts business. The Supply chain extends beyond internal business processes and also encompasses how broad in depth and scope organizations can reach to find, recruit, secure and retain talent of all types, but particularly in fields that demand highly skilled workers. Since much of global expansion is focused on emerging markets in underdeveloped countries much of the work that will need to be done to bring these countries into a fully developed state will require investments in infrastructure development which will require technological infrastructure as well, both of which require skilled and specialized labor and talent.
Kim & Wright (2013) “the extraordinary variations among emerging market countries suggest the need for multiple supply chains, each tailored to the specific needs of regions and communities and supported by locally developed capabilities and talent. Each supply chain should be flexible enough to accommodate rapid change. No matter how clear and detailed the blueprint for expansion into emerging markets, however, the most important element of success may be a company’s ability to build an adaptable and responsive ecosystem of processes, people, and technologies. The extraordinary variations among emerging markets suggest the need for country specific operations, supported by locally developed capabilities and talent.”
“The opportunity has never been greater for multinationals to attract top talent from emerging countries, such as Brazil, Russia, India, and China, or to outsource work to these countries. According to McKinsey Global Institute, there are approximately 33 million potential professionals in emerging markets and they are growing very quickly. The stock of suitable, young professional talent in emerging markets is growing at 5.5 per cent annually, while the number in developed countries is growing at just 1 per cent annually (McKinsey Global Institute, 2005 - II).”
Kapoor (n.d) “The transformation of human resources today is a direct call of the rapid changes within businesses due to factors such as globalization. Human resources need to take advantage of technology and data analytics to build a global human resource information system that collects and stores data from various sources. The global supply of talent is short of its long-term demand, and the gap is a challenge for employers everywhere. The shortage between the demand and supply of talent is likely to continue to increase, notably for highly-skilled workers and for the next generation of middle and senior leaders. Most emerging nations with large populations, including Brazil, Russia, India, and China, may not be able to sustain a net surplus workforce with the right skills for much longer. Now, more than ever, organizations need to place greater emphasis on attracting human capital rather than financial capital,” (p.
An analysis of how the technologies have changed the competitive environment, both internationally and domestically
With expanding opportunities and interdependencies on/in international trade; the impact of supply chain operations, logistics, procurement and transportation management for example; will rise in essentiality and require evolving, dynamic, practical and customized, yet universal administrative systems that can support and compensate for multiple geographies, variances in culture, language, knowledge and work technology. Riccio (n.d) “It is a time of global transformation and change made possible by logistics innovation. A time when the smallest companies can compete with the largest ones---sometimes with the advantage of being more nimble and quicker to seize opportunities.“
The ability to leverage human and intellectual capital to drive organization wide strategies internally and deliver value and benefit to customers, and functional partners externally is a determinant of the degree and extent to which businesses have skilled, capable expertise that they have developed within their talent communities, attracted through workforce development efforts; and sustained through prudent and inventive human management & development resources practices. The ability to know and understand how to use knowledge, requires knowledge!
The positive net value that a ERP system can deliver; requires knowledge in how intricately the technology is developed and requires knowledgeable managers, and employees to understand how to best capitalize off of the information that these systems can deliver. IBM (n.d) When our clients adopt as much of the preconfigured capability as possible as appropriate for their business, they can significantly reduce project time and related cost of the project,” explains Mitchell. “We build our solutions at a micro-vertical level so there is greater applicability to the company’s specific industry as well as their country based on language, currency and regulations, all prebuilt into that solution.”
Data is not information and information is not knowledge; however they can converge together to show pictures, trends, patterns and directionalities that can be analyzed and interpreted to strategically differentiate in markets broadly and specifically within emerging markets where growth and expansion are ripening for the kinds of advancement for both businesses and societies is and will continue to be needed. Technology is an enabling mechanism varying in its complexity, sophistication, ease of use and analytical capacity.
LaFramboise & Reyes (2005) “…information technology by itself cannot lead to competitive advantage, but may assist other recourses in doing so; on the other, Pereira (1999) argued that an ERP (e.g., SAP), if properly managed, could be a determinant of strategic competitive advantage in the RBV sense. According to the RBV [sic] resource-based view; firms have competitive advantage when they have resources that possess four key attributes i.e., value, rareness, inimitability and non-substitutability,” (p. 50).
