Traffic World
Globalization Continues But U.S.-Europe Tensions, Fear Of SARS Complicate International Trade

By Ken Cottrill

The invasion of Iraq may be over militarily but the hostilities are far from finished. That means more uncertainty for companies already grappling with the growing complexity of international trade.

John Coyle, professor of business logistics at Penn State's Smeal College of Business, recently talked to pharmaceutical companies in the United States about whether the threat of terrorism has made them more inclined to bring manufacturing operations back from offshore locations to their home bases. "We will develop the means to protect ourselves. There is risk in international trade and we accept that," was the response, said Coyle.

Last year Smeal College of Business published a study of the market for outsourced global trade operations and concluded that the potential savings range from $1.2 billion for consumer product goods to a high of $10.6 billion for the auto/industrial sector. Coyle, one of the study's authors, expects to see a shared-services approach emerging that will cater to midsize companies. Organizationally companies still have "functional silos" that prevent them from exploiting these services to the full, he believes. But overall the trade services market "will continue to grow," Coyle said.

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REPORTERS & EDITORS: For more information, please contact Wyatt DuBois in the Smeal College of Business Media Relations Office at 814-863-3798 or wed112@psu.edu .

Penn State's Smeal College of Business offers highly ranked undergraduate, MBA, executive MBA, Ph.D., and executive education opportunities to more than 5,500 students at all levels. Featuring academic departments of accounting, finance, marketing, insurance and real estate, management, and supply chain and information systems, the college is also home to major research centers such as the Center for Supply Chain Research, the Institute for the Study of Business Markets, the eBusiness Research Center, the Farrell Center for Corporate Innovation and Entrepreneurship, the Center for Global Business Studies, and the Center for the Management of Technological and Organizational Change.

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