In our latest podcast, we discuss the inaugural "Global Trade Report 2022" and how today's challenges for global corporations that engage in trade
Disruption and turbulence were strong themes in Thomson Reuters inaugural Global Trade Report 2022: Turbulence Tempered with Technology, released in September. Amid a troubled economic picture still hobbled by the global pandemic, a raft of new agencies, new regulations, new tariffs, and more sanctions formed a confluence of challenges that greatly impacted how companies across the globe conducted trade and managed their supply chains.
In this week’s podcast available on the Thomson Reuters Institute channel, we speak to Suzanne Offerman, Senior Product Manager at Thomson Reuters, about how this current environment in which companies that import and export goods must operate has become an ever-evolving puzzle to solve with shifting paradigms that some might say are moving at speeds not previously experienced before.
Of the companies surveyed in the Global Trade Report, many reported more significant concerns arising around retaliatory taxes and fees for those companies in the United State and the United Kingdom. In fact, more than 60% of US companies and about 40% UK and European Union companies surveyed said tariffs were greatly impacting their businesses. At the same time, companies doing business in Asia saw supply chain risk as a significant concern.
Given changing sanctions regimes and regulations, companies exporting from Asia must exercise caution in selecting with whom they do business. Indeed, companies utilizing Asian vendors in their supply chain are now required to know more than before about the identity and labor practices of their suppliers.
Talent & trade
To keep pace with the new and evolving landscape, companies are looking for new and additional trade management professionals to increase their available pool of expertise, skills, and technology prowess. In regard to talent, Offerman says in the podcast that the role and requirements of a trade manager are quite different now than they were when she started in the industry.
You can access the latest Thomson Reuters Institute Insights podcast, featuring a discussion about the recent Global Trade Report 2022: Turbulence Tempered with Technology, here.
In the podcast and in the Global Trade Report, Offerman points out that there is a list of must-have skills for today’s global trade managers. “The technical know-how of an engineer, the legal sense of an attorney, the carefulness of an accountant, the organizational skills of a project manager, the business acumen of an executive, the cultural awareness of a diplomat, and the communication skills of a leader that says a lot — and that’s one that’s supposed to be one person,” she explains, adding that this description underscores the importance of this role and how global businesses are coming to rely on trade managers to mitigate and manage more of the day-to-day operations of trade.
As the podcast explains, this situation has left global businesses challenged as to where to find the right talent and skillset to fill these roles. Businesses have looked at consulting firms, colleges, and even competitors to find the right professionals, but that has proven daunting.
Offerman explains that historically, someone got into global trade management by coming up the ranks within a company’s supply chain, working at a warehouse and then being promoted while receiving hands-on training throughout their employment. Now, universities are offering undergrad and graduate global trade classes (or eLearning classes for working professionals), alongside the study of such subjects as trade law, for example.
The technology solution
In regard to technology, the Report showed that more than 80% of the companies surveyed said they need technology to solve many of the issues they face today — a fact made all the more clear by recent events. “Because of the severe disruptions in supply chains and international trade, companies realized they couldn’t get their goods just from sourcing from one country,” Offerman says, adding companies learned they needed to move production to another country in the region or closer to their own home base. Thus, companies were pressured to come up with point solutions for specific regions.
However, Offerman says in the podcast, this may not be the best solution, and she urged companies to move to a holistic approach by using technologies that cover the entire supply chain, not just specific problem areas or regions.
Indeed, the need for the right technology goes far beyond increasing efficiencies — it’s needed to keep pace with governments that are increasingly leveraging more technology in order to gather more information and collect taxes and tariffs. “Companies cannot focus on only one aspect, talent, or technology but must be intentional at all aspects of trade in this way,” Offerman notes. “It is talent plus technology that get you to the finish line.”
In fact, as the podcast demonstrates, one will drive the other. To compete for the necessary talent, the technology that companies need to utilize will be a factor in attracting the very type of trade management professional with the skills they need. No one wants to work on outdated software or equipment, of course, especially when it can impact their quality of work. Therefore, any investment companies make in trade solution software that keeps them in compliance will also ease additional work processes and drive further efficiencies.
Trade compliance rules and work will not get less busy, Offerman explains in the podcast, it’s that businesses will grow and evolve along with the regulatory space. And that means that companies must enable their top professionals with the right technology in order to stay compliant and competitive.