Introduction to Cloud Supply Chain Management
The concept of Supply Chain Management (SCM) isn’t just about tackling the equation between demand and supply. In a broader context, SCM describes elements such as shorter product life cycles, constant change, increased demand, carbon footprint, and the cost dynamic.
Whether you are an eCommerce giant, an automaker, or a retailer, the probabilities of your business stocking up and using logistics to move things from one point to another is inescapable. Even though this sounds pretty simple, reality can be extremely complex, as the need to manage a vast fleet of vehicles and several other logistic variables can be a daunting task by itself.
In essence, SCM is the process of managing supply chain activities to reduce costs and gain a competitive edge in the market. Well, it does not end here. The core of SCM also deals with the procurement of raw materials, product development, quality of goods, and logistics.
Today, across the logistics industry, several companies still rely on traditional on-premise software. But here’s a heads up. Cloud-based SCM tools have the potential to radically make a difference in the overall efficiency of the company. And the technology has proven its caliber to redefine the way supply chain managers handle the process completely.
How does cloud computing transform SCM?
Unlike outdated on-premise SCM systems, the cloud-based version seamlessly integrates across multiple devices, combining and analyzing data in real-time. These modern solutions are accessible virtually from almost every device, making it a popular choice amongst supply chain decision-makers.
Built on the concept of holistic performance, integration of SCM into the cloud advances strategies and drives profitability by increasing proficiency. Yet the major appeal of cloud technology is focused on providing seamless interoperability and elimination of digital communication boundaries between different applications. So, when it is the question of coping with customer demand without adding to cost, cloud-based SCM systems help businesses rapidly adjust to the changing needs of the industry.
Drawbacks of on-premise SCM technology
No need to adjust to logistics, just transform them!
Well, if your SCM still operates on an on-premise platform, the cloud is the best way to make your SCM future-proof.
Business challenges are dynamic and are accelerating at an overwhelming rate without any sign of slowing down. In the modern market, competition gets fierce as customers expect more; newer products are introduced and updated at an unimaginable pace and not to forget the entry of new companies daily. This is why an on-premise SCM does not have the agility and scalability that a growing business needs.
Several established organizations are trying hard to cope with the increasing supply chain requirements and decreasing IT budget. Often, a huge amount of money is invested in maintenance and upgrades of such software rather than on innovation. And the situation isn’t any different for startups and newer entrants of the market. To balance such conditions, a brand new approach is a must.
The modern twist to SCM
Due to the rigidity and shortcomings of on-premise applications, a myriad of supply chain innovators are shifting preferences to the power of cloud computing to battle the dynamic challenges of a demanding business environment.
As per a report by IDC published in 2018, the Supply Chain Survey found that 75% of businesses realized that cloud computing was critical to delivering supply chain excellence for the present and the future.
6 reasons that make cloud inevitable for SCM
Agility
Demand volatility is a major concern for companies, and supply chain agility works toward predicting and responding to demand with greater scalability. SCM in the cloud offers IT flexibility and the ability to respond to ever-changing market demands with the quick and secure deployment of new services and capabilities.
Simple to use
The best part about SCM in the cloud is its ability to speed up deployment, while making outsource management, maintenance, and upgrades easier. With routine tasks taken care of, your resources can focus on innovation. The simple user experience, quick access to accurate and timely analytics, and ease of collaboration have quickly made the cloud a sought-after choice for SCM.
Completeness and connectivity
The major challenge faced by on-premise SCM is the shortfall in integrating systems to foolproof uniformity and easy accessibility of information throughout the organization. On the other hand, SCM in the cloud promotes open and seamless integration for real-time collaboration that makes a tangible impact on the overall efficiency, productivity, and performance of the organization.
Cost dynamic
Cloud-based SCM can bring a revolution for both established and young organizations. The low upfront investment and pay as you go pricing concepts appeal to organizations by helping them convert from a CAPEX to an OPEX model.
Affordable upgrades and new capability rollouts make the transformation far less expensive compared to a huge IT overhaul. Additionally, cloud computing simplifies the integration of emerging technologies ready to share insights that can improve business outcomes, accelerate processes, and reduce costs, especially for repetitive tasks.
Big or small, every business needs data security. Most cloud solutions can be optimized to support the top range of security features such as encryption, whitelist support, virus scanning along with embassy – grade physical and logical security.
In essence, investing in cloud services protected against major concerns such as data loss and data hacking can pay off well.
Seamless and safe deployment
Another remarkable benefit of migrating SCM to cloud is the fact that there is no need to do it at once. The ease of selecting elements with the potential to deliver high value to the business can be prioritized in terms of migration and implementation.
Since logistics is a large part of SCM, several countries have made the most of it by making improvements to their transportation system in different ways. Downloading this whitepaper can give you a detailed idea about the same.
Conclusion
SCM is complex, time-consuming, and expensive when accessed on an on-premise setup. Today, several businesses opt for the transformation of SCM into the cloud as they slowly realize its benefits. Not just this, integration of SCM into cloud increases the readiness of the business to meet changes and makes an important impact on the overall business performance.
If you want to know more, then download our latest whitepapers on supply chain.
