The impact of cloud computing on the supply chain industry

Grazed from CloudServicesWorld. Author: Claire Umney.

In an industry where collaboration and visibility are key requirements, cloud computing is a rather new business model with great potential. In their IT cloud services forecast 2013-2017, market intelligence provider, IDC, reports that on a global level only 20 percent of manufacturers, process agents and retail businesses currently use cloud computing. The same research stated that 75 percent of the companies surveyed were however looking for cloud solutions as an alternative, while projecting a growth rate of at least 7 percent for 2013. What exactly is it that’s driving supply chain professionals into the cloud?

Cost savings

The most obvious benefit of adopting cloud computing solutions is cost savings from deployment and the short implementation time frames. Unlike legacy systems, either custom–built or packaged software – there is no IT infrastructure to maintain on-site, no upfront licensing fees, and no software programmes to install and maintain…

Businesses save integration costs because internal departments, partners and suppliers can also link up through the cloud, which facilitates a quicker return on investment. Companies are not dependent on limited IT resources and can deploy and implement supply chain solutions in the cloud on-demand, at a much-reduced cost, and can also scale them as required. For example, if a company opens a new warehouse, it can immediately scale the existing solution to incorporate the new warehouse without the need to change IT infrastructure, which frees up IT staff to work on more meaningful projects rather than system maintenance…

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