By 2025, the number of large companies ($1 billion+ in annual revenue) with headquarters in emerging regions is expected to triple from 2010, according to McKinsey Global Institute's Urban World: The Shifting Global Business Landscape. According to the report, 70 percent of the new companies reaching that size between 2010 and 2025 will be based in emerging regions.
According to the report, the rise of emerging economies has presented U.S. companies with market and labor force opportunities, but emerging economies are also producing a growing number of large companies which the report says "could profoundly alter long-established competitive dynamics around the world."
One "imperative" the study suggests for CEOs preparing for increasing competition from within emerging markets is to optimize sales networks. "B2B companies will need to assess how to organize themselves so they can sell to a much more diverse and dispersed customer base. To do so, they must rethink (and perhaps redeploy) their sales networks."
Radically reorganizing a company's sales structure can also create higher customer value and switching costs while improving margins, according to Mike Marks and Steve Deist of Indian River Consulting Group in The Case for a Radical Sales Overhaul. Whether distributors define newly specialized sales roles by customer, service output or other factors, Deist says once you get to a market-based model “everybody is happier.” Learn more about sales force realignment in The Case for a Radical Sales Overhaul.
Read more about the impact of increasing global competition in Global Competition on a Local Level.