What is supply chain management?

What makes cloud computing well suited for supply chain management applications?

• Interested in knowing what are the benefits of using cloud architecture for supply chain management applications.

• Answer:

  Awesome question! Cloud computing, and resulting SaaS model around it, is probably one of the most incredible and disruptive innovations to occur for the supply chain in quite some time.  Cloud computing is well suited for supply chain management for these key reasons: 1) Cost - With cloud computing supply chain organizations now have an opportunity to "plug-in" to an existing infrastructure that may be utilized by a host of entities and therefore will typically be more economical and also potentially more robust.  This "plug-in" capability dramatically lowers the cost implications and begins to resemble a variable cost line item in the P&L.  This variable cost structure is significantly different to the more common capex intensive endeavors of enterprise software.  Generally, and historically enterprise software endeavors in the supply chain carry with them significant balance sheet implications and also carry with them significant bureaucracy & significant charge-backs. 2) Flexibility - A wonderful attribute of SaaS / cloud-based software for the supply chain is the inherent flexibility of these platforms.  Anyone in supply chain software, particularly on the user side, has been a part of teams or heard of case studies where teams find their legacy infrastructure is simply outdated.  With cloud-computing models the ability to make changes and maintain relevancy with market changes or opportunities is a simpler proposition.   3) Ease of Deploymentd - I've written in previous blog posts about the changing nature of supply chains and the increased variables and also increased entities that are involved to effect a successful outcome.  In this ecosystem of distributed stakeholders it is vitally important to be able to extend a layer of software out to these entities that can help guide and ensure a successful outcome.  In legacy application environments extending software and tools out to the stakeholders can require significant planning (time) and capital (money).  In a cloud-based environment, the distribution of functionality and applications that facilitate work processes becomes easier.  In effect, stakeholders that have an Internet connection and a functioning computing device can be productive nodes in your supply chain network. 4) Speed -  The Internet, cloud computing and the ubiquity of devices (smart phones, computers, tablets) has drastically leveled the playing field in the supply chain world.  Today there are significantly more high functioning and competitively priced 3PL providers than might have existed just a few years back.  Cloud-computing allows strategic and intelligent supply chain organizations and service provider to demand more in terms of value, time to market and efficacy of solution.  In effect, the bar has been raised exponentially. Cloud computing represents a real win for the supply chain discipline and for supply chain organizations everywhere.    For smart executives and managers utilizing this tool to compete more effectively should be job #1.