Five Reasons to Consider Cloud Services for Your Supply Chain

Supply chain and logistics management uses resources, processes, and technology to create solutions that deliver the right goods to the right place at the right time—as quickly and cost effectively as possible. Managers looking for technology to support those solutions may find that cloud computing offers some compelling options.

Lower IT Infrastructure Costs

Reducing costs is a significant factor in most supply chain managers’ decision to move to the cloud. Outsourcing the maintenance and management of your IT infrastructure and workloads to off-premises data centers provides levels of compliance and high availability that could be costly to implement in your own environment. Cloud hosting providers also tend to offer support from skilled teams that specialize in keeping IT infrastructure and systems running. Depending on your needs, cloud hosting can help you keep costs down by decreasing your IT spend.


Another oft-cited benefit of hosting in the cloud is scalability—the capacity to provision additional resources or decommission them as needed. Agile operations make the supply chain more effective, and managing IT resources according to present and anticipated needs contributes to technological agility.

Disaster Recovery and Business Continuity

Losing even one day’s worth of data can create a significant setback in operations by disrupting business continuity and amassing monetary and time costs due to lost productivity and lost business. Hosting your data and systems in the cloud can help you protect your data and keep goods flowing through your supply chain. Most cloud hosting providers offer high availability guarantees along with hosting data and systems in multiple locations for resilient recovery when disaster strikes.

Another key component for business continuity and disaster recovery is backup software that continuously protects your data. Cloud services offer server backup solutions for a wide variety of environments, including ones that run on multiple platforms with different technologies and operating systems. Incorporating cloud-based backup into your overall data protection strategy provides off-site data storage and fast access to backups in the event of data loss.

Software as a Service, Platform as a Service

A PWC report on the future of the logistics industry predicts that “‘digital fitness’ will be a prerequisite for success: The winners will be those who understand how to exploit a whole range of new technologies, from data analytics to automation and platform technologies.”

Software-as-a-service models provide cloud-based systems for transportation management, warehouse execution, and shipment execution. Platform-as-a-service provides options to configure more robust solutions like data analytics, which can inform strategic and in-the-moment decision-making to keep the supply chain running. Using cloud-based services can also help you standardize technology and make it more accessible if your business has grown through mergers and acquisitions.

The Internet of Things

The Internet of Things (IoT) provides a multitude of ways for supply chain managers to gain efficiencies. Devices and objects equipped with sensors, RFID tags, wifi-enabled labels, and antennas can send information about their location, weather conditions, and other variables to systems securely hosted in the cloud. These systems, in turn, improve supply chain operations by tracking product location in warehouses, automating picking, making loading/unloading at docks more efficient, and tracking product consumption to enable automated reorder.

While cloud technologies cannot solve all supply chain challenges, they can contribute to innovative solutions that deliver the right goods to the right place at the right time—as quickly and cost effectively as possible. Supply chain managers and logistics providers would do well to investigate cloud computing options as part of their due diligence for these solutions.

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