By Wido Riezebos, CTO
For more than 20 years, the concept of cloud computing has been used to manage data from a remote location. It’s a technology embraced in many industries, used in both business and consumer applications, and continuously developed to meet the needs of an ever-changing landscape. Yet, despite the seemingly widespread adoption of this technology, the cloud remains on the fringe of adoption for the supply chain and logistics industries.
While cloud computing can transform the way supply chain and logistics companies operate, barriers still exist for widespread acceptance. Still today, concerns about security persist as the largest disconnect for a deep dive into cloud-based infrastructure, with 61 percent of IT senior management citing this reason according to a recent study by IDG Enterprise. Not far behind is the traditional conservative thinking of IT departments, worrying about disrupting company operations upon integration, with 46 percent of those surveyed saying this is the largest bridge to cross. This sense of inertia, especially when existing systems seem to be working satisfactorily, is what cloud companies must break through to highlight opportunities of adoption vs. remaining stagnant in old systems.
The good news? Cloud systems are making a big push. As they continue to display their maturity and benefit to overall operations, the supply chain and logistics industries appear to be following adoption suit. In fact, Gartner found that although only 8 percent of firms currently use a cloud-based Transportation Management System (TMS), another 51 percent of companies are “likely” to use TMS in the cloud in the future.
Why the push? Use of the cloud provides ease and affordability of access and maintenance; top priorities for supply chain executives. The results include better carrier integration capabilities that improve visibility in the Control Tower, enabling access to real-time data. The cloud also allows shippers to scale easily as companies grow and new processes come in place, and reduces the overall need for IT infrastructure by seamlessly integrating into existing systems.
Additionally, the cloud introduces collaboration opportunities that perhaps didn’t previously exist, helping shippers explore their shipping networks and use their trading partners to leverage each other’s resources with more ease and regularity.
Cloud-based TMS makes large-scale cost management a reality by enabling quicker setup that reduces deployment time. Shipping visibility into outsourced transportation operations enables companies to better manage the costs associated with these services, and that enhanced visibility makes cost management easier with improved access to accurate and useable data.
As supply chain and logistics leaders continue to explore a need for a cloud-based TMS solution, they must consider the opportunities for sustained success and new capabilities that can enable their businesses to grow. A sophisticated cloud solution offers more than ever before for those willing to take the initial plunge. It’s now up to companies to decide if the time is right for a widespread adoption, and start planning their success strategies.