Global Trade: How to Know You Need New Compliance Processes

Global Trade: How to Know You Need New Compliance Processes

Companies involved in global trade must conduct business in such a way as to satisfy national and international regulations. Maintaining compliance is no easy task. As such, companies tend to implement processes and controls to maintain compliance and mitigate mistakes.

Global trade compliance is only as effective as the processes developed to facilitate it. Yet no process is perfect. Furthermore, processes have to evolve to keep pace with changing regulations. So how is a company to know when it needs updated or completely new compliance processes?

Vigilant Global Trade Services, an Ohio company that helps clients implement compliance process optimization, says it is all about recognizing the signs. There are things companies can look for; things that clearly indicate the need for new processes and controls.

  1. Inefficient Product Classification

One of the more time-consuming aspects of global trade compliance is product classification. Companies have to classify both imports and exports for tax and duty purposes. And when you combine all the classification codes used globally, you are looking at thousands.

Efficiency is of utmost importance here. Companies need classification processes that allow for getting the job done as quickly as possible yet with minimal mistakes. If staff is spending too much time on classification due to the way their processes work, perhaps it’s time to rethink those processes.

  1. Too Many Avoidable Errors

Between product classification, filing paperwork, and all the other things that go into global trade compliance, it is not possible to get it right all the time. Mistakes happen. However, a company concerned about its processes should take a close look at how often avoidable errors occur. Making such errors too often could mean a process is outdated or insufficient to the task at hand.

  1. A Lack of Automation

Vigilant says that automation is the latest trend in global trade management. Companies are embracing new technology solutions that automate routine tasks for increased efficiency with fewer errors. Knowing that, any company whose global trade processes do not include automation technologies is ripe for upgrades.

Automation is where it’s at. It is also the future of global trade management. One of the most important things a company can do in terms of compliance process optimization is transition to automated processes wherever possible.

  1. A Lack of Process Support

Every process a company puts in place requires support to some degree. Processes are supported by technology, expert consulting, and the knowledge and experience of those employees tasked with implementing said processes. A lack of support suggests that a process may be reaching its end of life.

For example, outdated technology supporting an outdated process will eventually go by the wayside. When it does, that technology will not be replaceable. Supporting the process now becomes a problem. The only real solution is to come up with a new process supported by modern technology.

  1. Hard But Necessary

When it comes to compliance process optimization, change can be hard to implement. Companies come to rely on doing things a certain way. They are resistant to change because that means learning and implementing new things. But even though change is hard, it is also necessary.

Complying with global trade regulations is never going to get any easier. Governments and policymakers aren’t going to suddenly change direction and go out of their way to make global trade easier. If anything, they are going to keep making it harder.

The effectiveness of a company’s compliance processes ultimately determines how efficiently and cost-effectively compliance is achieved. When decision-makers start seeing inefficiency, increased errors, and a lack of process support, it’s time to start thinking about new processes.

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