belgium in the new global economy forum be.international a study commissioned by feb-vbo and...

BELGIUM IN THE NEW GLOBAL ECONOMY

Forum be.international A study commissioned by FEB-VBO and Deloitte Belgium

Context of the study

Emerging markets : centers of growth and essential trade partners for exports and imports

Growing networks across countries : technology and flows of goods and services

Scarcity of resources and ageing population Negative public opinion towards globalization

Where is Belgium in the new global economy? Part 1: worldwide exports Part 2: internationalisation of value chains

Belgium in the New Global Economy Prof. Dr. Sleuwaegen (Vlerick) and Prof. Dr. Peeters (Solvay)

Part 1: Export

Position of Belgium in global markets Belgium is losing market share

% of Belgium in world trade in goods


Part 1: Export

Position of Belgium in global markets Activity in fast growing markets

Share of BRIC in exports of goods

Share of BRIC in exports of services


Part 1: Export

Position of Belgium in global markets High-tech goods in Belgian export

Share of high-tech in total exports of goods


Part 1: Export

Position of Belgium in global markets Product specialization

Belgium's share in world exports by sector


Part 1: Export

Who exports? Multinational enterprises in Belgium

Indu

stry

Net

Tra

de B

alan

ce

Industry share of employment by multinational enterprises


Part 1: Export

Who exports? Intermediate goods

Exports Imports


Part 1: Export

Who exports? Belgium as “middle-man” in global supply chains

Value added of trade


Part 1: Export

Who exports? Large vs. small firms

Newly exporting SMEs


Part 1: Export

Survey results

Need for internationalization support and support received


Part 1: Export

Policy recommendations

To the business community Make international expansion part of the strategy

from the start.To public authorities

International competitiveness: improve business climate

Focus on companies that are not yet internationally active

Develop expertise centers and international business development programs

Develop extensive (credit) guarantee and risk insurance programs


Part 2: International value chains

Zoom into services Survey on international sourcing of services

March – May 2012 80 companies in Belgium Merged with Offshoring Research Network dataset 5073 cases of imported services

430 from Belgium 2755 from the United-States 2420 from other European countries (Netherlands,

Germany, UK, Denmark, Spain…) 74 Belgian companies that do not source services

abroad



What services are sourced abroad?

Source: ORN global survey

‘Business processes’ = finance, accounting, human resources, marketing and sales, procurement, legal, and other back office functions

‘IT & Software’ = development and maintenance of IT infrastructure, development of software

‘Technology’ = R&D, product design and engineering services

‘Contact centers’ = inbound and outbound contact centers



Top 5 strategic drivers

Source: ORN global survey (average score on 1-5 scale)



Barriers (what would make you consider international sourcing?)

Source: ORN global survey (average score on 1-5 scale)



Outcomes


Missed opportunities ?

Missed opportunities ?



At least 3 explanations

Conservative sourcing practices

Lack of sourcing strategy

Weak global service delivery structures



Conservative practices – Country choices




Conservative practices - models




Lack of strategy

50% of Belgian respondents do not have a BU / corporate level sourcing strategy

50% of Belgian respondents do not have a BU / corporate level sourcing strategy




Weak global delivery structures

80% of Belgian respondents do not optimize their global service delivery structures

80% of Belgian respondents do not optimize their global service delivery structures




Risks of international sourcing

Top 5Top 5




Experience gains




Key messages to managers Don’t be afraid to look abroad to source services Important gains

Competitiveness, organizational flexibility, productivity, focus on core business, and access to qualified personnel

To maximize the gains Develop corporate sourcing strategy and optimize

global delivery structure Develop skills and capabilities in strategic planning and

change management, risk assessment and mitigation, cross-cultural and virtual management, and contract and supplier relationship management

Continuum of sourcing options with usual risk / benefit tradeoff Internal nearshoring farshore outsourcing


Concluding thoughts

Despite positive growth of exports we are losing shares in global markets High-tech, knowledge intensive product and services Fast growing markets (BRICs)

Importance of ‘born globals’ and SMEs Generate new exports, create value and employment Specific needs for public policies

Int’l sourcing as road to competitiveness Lower gains compared to USA and European neighbours Need for strategy, structure, and update in skills and

capabilities Should we learn to lose control and work with other

cultures?


belgium in the new global economy forum be.international a study commissioned by feb-vbo and...

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