Enlightened Engagement

 I recently got an email newsletter from importers.com with the following interesting information:

The world is trading more now than ever before!

- World trade now represents 47% of the World’s GDP, compared to just 10% in 1970
- International merchandise exports reached USD $11.7 Trillion in 2006, up 18% (USD $1.8 trillion) compared to 2005

Small & medium sized enterprises (SMEs) fuel world economies

- More than 95% of businesses in most countries are small (<100 employees)
- In most countries, more than half of all employees work in small businesses
- In many countries more than half of gross domestic product comes from small businesses
- In 2006, about $24 trillion of goods were produced by SMEs
- SMEs account for 25%-35% of internationally traded goods

The Internet is driving international trade

- With 1.2 billion users, 18.9% of the world’s population is now online
- The USA has the most Internet users (210 million), followed by China (162 million)
- According to research by Forrester, 80% of B2B buyers now search online before they purchase
- Over 80% of B2B buyers say that more than 50% of their suppliers are met online

Online fraud remains a worldwide threat

- According to Pricewaterhouse Coopers, one out of every 2 businesses has suffered economic crime in the past 2 years
- BuySafe.com reports that 76% of online buyers worry they will not get what they paid for and 72% say the trust problem is getting worse
- At Fraud.org, where Internet users complain about online fraud, 34% of all complaints were for “goods not delivered” and 33% were for “goods not delivered as promised”
- Surveys of B2B website users state that trust is the #1 sourcing challenge
- At most B2B websites, more than 90% of member companies are NOT verified

Internet or online trade is good but beware of the fraud as well.

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McKinsey Global Survey of Business Executives: Economic and hiring outlook , July 2007

{ The McKinsey Quarterly conducted the survey in June 2007 and received responses from 2,700 executives around the world. All data are weighted by the GDP of the constituent countries to adjust for differences in response rates. }
We all know about the loss of jobs to low-cost labor elsewhere. But McKinsey Global Surveys shows that the trend may be shifting.

Here are few key points from the survey :

• More than half of the executives at companies headquartered in the developed world say the majority of their new jobs will be created in the same country as the corporate headquarters.
• Only a quarter say that most new jobs created abroad will be the same as those now performed at home.
• Around the world, executives have consistently reported that far more companies plan to increase their workforces than to decrease them and that a majority of the new jobs will be created at home.
• Of the small number of jobs lost around the world, only 20 percent will be eliminated as a result of outsourcing,nearly three-quarters of the respondents who do not expect the size of their workforces to change say they don’t expect any significant function now performed in the home country to move elsewhere.

Original Article : http://www.mckinseyquarterly.com/Organization/Talent/McKinsey_Global_Survey_of_Business_Executives_Economic_and_hiring_outlook_July_2007

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FLOSS role in the economy: Selected findings on  market share and geography
 

{ Financed by the European Commission’s Directorate General for Enterprise and Industry, a study has been carried out by a team led by UNU-MERIT, the Netherlands, to identify the role of FLOSS in the economy, its direct impact on the ICT sector, its indirect impact on ICT-related sectors and to recommend policies based on forecasted scenarios. (Prepared by : Rishab Aiyer Ghosh, UNU-MERIT, the Netherlands on November 20, 2006) }

• The notional value of Europe’s investment in FLOSS software today (2006) is Euro 22 billion (36 billion in the US) representing 20.5% of total software investment (20% in the US).
• FLOSS market share higher in Europe than in the US for operating systems and PCs, followed by Asia.In the public sector, Europe has particularly high penetration, perhaps soon to be overtaken by Asia and Latin America. In the private sector, FLOSS adoption is driven by medium- and large-sized firms.
• Forrester research found that European firms have been actively adopting open source software over the last few years, so that by the end of 2005 the overall share of companies using such systems amounted to 40%.
• Almost two-thirds of FLOSS software is still written by individuals; firms contribute about 15% and other institutions another 20%.
• Weighted by regional PC penetration, central Europe and Scandinavia provide disproportionately high numbers of developers; weighted by average income, India is the leading provider of FLOSS developers by far, followed by China.
• The existing base of quality FLOSS applications with reasonable quality control and distribution would cost firms almost Euro 12 billion to reproduce internally. This code base has been doubling every 18-24 months over the past eight years, and this growth is projected to continue for several more years.
• This existing base of FLOSS software represents a lower bound of about 131 000 real person-years of effort that has been devoted exclusively by programmers. Annualised and adjusted for growth this represents at least Euro 800 million in voluntary contribution from programmers alone each year, of which nearly half are based in Europe.
• Firms have invested an estimated Euro 1.2 billion in developing FLOSS software that is made freely available. Such firms represent in total at least 565 000 jobs and Euro 263 billion in annual revenue.A conservative estimate is that the number of employees among firms contributing code to FLOSS projects is at least 570 thousand.
• FLOSS-related services could reach a 32% share of all IT services by 2010, and the FLOSS-related share of the economy could reach 4% of European GDP by 2010.
• FLOSS and proprietary software show a ratio of 30:70 in recent job postings indicating significant demand for FLOSS-related skills.
• FLOSS potentially saves industry over 36% in software R&D investment that can result in increased profits or be more usefully spent in further innovation.
• A growth and innovation simulation model shows that increasing the FLOSS share of software investment from 20% to 40% would lead to a 0.1% increase in annual EU GDP growth excluding benefits within the ICT industry itself – i.e. over Euro 10 billion annually.
• According to IDC in a report, Linux accounted for 14% of servers and 5% of PCs in 2004 in the Asia-Pacific region, expected to grow to 25% and 9% respectively by 2008.In Malaysia, a survey conducted by MAMPU in 2005 showed that 74% of public sector organisations implemented FLOSS solutions.
• 80% of Chinese organisations using FLOSS applications.
• In 2005 there were 265 Open source policy initiatives around the world of which,Europe launched 126 Open source policy initiatives, in Asia there were 73, there were 40 in Latin America, 17 in North America and 4 each in the Middle East and Africa.
• The combined FLOSS (MERIT/FP5) and FLOSS-US (Stanford) developer surveys form the largest survey-based dataset (4282 cases) providing the geographical distribution of developers . According to these surveys, more than three fifths of the worldwide FLOSS developer community live in the EU, one fifth in North America, and another one fifth or so live in other countries.
• Custom software (52% in Europe, 41% in the US) and in-house software (29% Europe, 43% US) cannot really be cannibalized by FLOSS — they do not involve software licence fees that are the only spending that FLOSS necessarily eliminates.

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• Middle Ages — Actor and person in charge of large-scale production projects.

• 17th Century — Person bearing risks of profit (loss) in a fixed contract with government.

• 1725 Richard Cantillon – person bearing risks is different from one supplying capital.

• 1803 Jean Baptiste Say – separated profits of entrepreneur form profits of capital.

• 1876 Francis Walker – distinguished between those who supplied funds and received interest and those who received profit from managerial capabilities.

• 1934 Joseph Schumpeter – entrepreneur is an innovator and develops untried technology.

• 1961 David McClelland – entrepreneur is an energetic, moderate risk taker.

• 1964 Peter Drucker – entrepreneur maximizes opportunities.

• 1975 Albert Shapero – entrepreneur takes initiative, organizes some social and economic mechanisms, and accepts risks of failure.

• 1980 Karl Vesper – entrepreneur seen differently by economists, psychologists,
  businesspersons, and politicians.

• 1983 Gifford Pinchot – intrapreneur is an entrepreneur within an already established organization.

• 1985 Robert Hisrich – entrepreneurship is the process of creating something different with value by devoting the necessary time and effort; assuming the accompanying financial, psychological, and social risks; and receiving the resulting rewards of monetary and personal satisfaction.

Source: Adapted of Hissich and Peters, 2002
by
Eduardo Manuel
Online at http:// mpra.ub.uni-muenchen.de/ 2237/

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From the AMR Research website — “The AMR Research Supply Chain Top 25 uses a strict but simple methodology to identify companies that are demonstrating leadership in the area of supply chain management.”

1. Nokia 
2. Apple
3. Procter & Gamble 
4. IBM
5. Toyota Motor 
6. Wal-Mart Stores 
7. Anheuser-Busch 
8. Tesco 
9. Best Buy 
10. Samsung Electronics
11. Cisco Systems 
12. Motorola 
13. The Coca-Cola Company
14. Johnson & Johnson 
15. PepsiCo 
16. Johnson Controls 
17. Texas Instruments 
18. Nike
19. Lowe’s 
20. GlaxoSmithKline 
21. Hewlett-Packard 
22. Lockheed Martin 
23. Publix Super Markets 
24. Paccar
25. AstraZeneca 

Source: http://www.amrresearch.com/supplychaintop25/

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