Automating Global Supply Chain Can Improve Profitability from 10%-40%

Study suggests automation can help improve cycle times and eliminate inefficiencies.

A new study suggests companies stand to gain dramatically by implementing global trade best practices and accompanying automation, and could see improvement between 10% and 40%, according to Stanford University and TradeBeam, a provider of software that helps companies comply with global trade agreements online.

The research, "How Enterprises and their Trading Partners Gain from Global Trade Automation: A New Process Model for the China-US Trade Lane," focuses on the benefits of global trade automation and provides estimates in key benefit categories based on input from supply chain practitioners from the U.S. and China.

A key result of the study is a new global trade process model which enables enterprises and their trading partners to systematically analyze trade lanes and find and eliminate inefficiencies. The initial model focuses on the China-U.S. trade lane, but can be applied in other geographic and industry contexts.

Co-authored by Hau Lee, of the Graduate School of Business, and Warren Hausman, of the Department of Management Science and Engineering, as well as experts from TradeBeam, the study is based on over a year of research.

"This report demonstrates that companies can gain substantially by automating their global supply chains, probably much more than they have estimated to date," says Warren Hausman, professor of operations management in the Department of Management Science & Engineering at Stanford University. "By creating a new process model attuned to global trade, we hope to help companies make improvements that will help them thrive in the global economy, not just with short term gains but over the long term as well."

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