How does glocalization change the international added value?

For decades, globalization has changed value-added chains worldwide. However, this trend has been subject to rapid change: emerging protectionism of different markets, the fact that Asian manufacturers have rapidly caught up in quality and reliability as well as the fragile access to rare raw materials and specialized components are just some examples of this new development. At the same time, localization strategies and the differentiation within economic regions are moving more into focus – also in order to counteract dependencies in the supply chains and to shorten transport chains.

In its research projects, Fraunhofer ISI puts the focus on the dynamic analysis of value-added chains: How can central developments of glocalization be described? Which networks and structures determine the future?

Important aspects of the scientists are for example resilience, adaptability and the reliability of value-added chains. Furthermore, they work on concrete questions on the choice of location and the design of value networks.


Model-based Scenario Analysis of the Effects of Made in China 2025 on the Value-added and Market Shares of the German Mechanical Engineering Industry (Made in China 2025)

Objectives are modelling and simulation of the value-added and market effects of “Made in China 2025” on German industry for the time horizon of 5-10 years based on the current system. Because of its high relevance with regard to the advanced manufacturing technologies mentioned in “Made in China 2025”, such as high-end-controlled machine tool systems, robot technologies, smart sensors, radio recognition chips, etc., the study is being carried out with a special focus on German Mechanical Engineering Industry.

The value of value added

In-house production is worth it, outsourcing harbors risks. So concludes the study, “The value of value added” by the Karlsruhe University of Applied Sciences and the Fraunhofer ISI. A major result of the study, which was funded by the Ministry of Finance and Economics Baden-Wuerttemberg, is the significantly positive influence that in-house value creation has on profit and productivity. This means that outsourcing to foreign suppliers should be assessed more critically. Manufacturing companies based in Baden-Württemberg currently already have above-average in-house value added, but should continue to expand this in future-oriented fields like electric mobility.