March 2005 | Commentary | Checking In

Flying Under the Global Radar

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Earlier this month, billionaire entrepreneur Richard Branson's Virgin Atlantic GlobalFlyer completed the first round-the-world flight in 67 hours, two minutes, and 38 seconds.

Four days later, and to considerably less fanfare but arguably greater importance, Boeing's 777-200 LR Worldliner, the longest-range commercial airplane in the world, completed a three-hour test flight from Everett, Wash., to Seattle's Boeing Field. By 2008, the airplane manufacturer expects to debut its 777 freighter, which will be capable of carrying 222,000 pounds of cargo, accommodating 37 standard pallets, while covering 5,200 miles without refueling.

These two aviation benchmarks serve as reminders of two immutable realities: first, that transportation and logistics innovation will continue to shape the world we live in; and second, the world we live in is getting smaller.

Transportation, and its supporting infrastructure, isn't the only contributing factor to these global trends. Investment in technology and people is equally vital to how well businesses court foreign markets. These same companies increasingly seek out logistics expertise to help match technology with sound supply chain strategies and find optimal locations for offshore facilities.

Where are these growth areas? Our 2005 Global Logistics Guide (see March issue) scopes out which countries are leaders and laggards in transportation and logistics by analyzing the density of airport and port infrastructure, the strength of homegrown logistics talent, as well as the maturation of IT development and investment.

It also takes into account less tangible concerns such as government control, economic obstacles, and political stability.

Our methodology indicates that size and money don't necessarily matter; countries that excel embrace transportation and logistics as core national endeavors.

Switzerland, by example (Switzerland Banks on Logistics), is quickly becoming a stepping-stone for global businesses targeting new markets in Europe, largely because the government proactively invests in transport infrastructure.

While American multinationals such as DuPont and GM have set up shop in Switzerland and will continue to migrate elsewhere as they grow, smaller businesses are naturally more hesitant about making long-term global investments, as you'll see in Lisa Harrington's look at how smaller companies tackle globalization (Small Companies Take on the World).

As the world continues to shrink, its individual parts become more amplified. Globalization gives less-visible countries—Finland, Ireland, the Netherlands—greater leverage in challenging larger countries for foreign investment. A similar argument can be made for smaller enterprises that leverage technology and logistics talent to compete with upper-tier companies on a global scale.

Regardless of size or scope, however, global businesses that perform their due diligence now and match long-term growth strategies with short-term investments in the appropriate locations will ultimately be better prepared for tomorrow.

Then, perhaps, they will find themselves in the right place when that Boeing 777 freighter touches down.

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