The logistics industry continues to face many bottlenecks and challenges. According to research done by EY, the COVID-19 pandemic further highlighted and amplified issues in the supply chain. The persistent unpredictability and labor shortage continue to impact the supply chain industry. This begs the question of whether cloud computing in the supply chain is the ultimate solution to all these problems. There are promising signs that businesses are incorporating various cloud bsaed supply chain management solutions.
So, what is cloud-based supply chain management all about? How can businesses leverage cloud computing technology to streamline their business operations? What benefits will they get by incorporating cloud computing into supply chain operations? This article will provide you with a comprehensive idea of how cloud computing can help with your supply chain operations.
What is Cloud Technology?
Cloud technology or cloud computing refers to data transfer to the cloud instead of hosting it “on-premise” or on your local servers. All data is moved to the computing services for storage and analytics. It is a technological phenomenon that is gaining a lot of traction across various industries.
What Does It Mean for Supply Chain Management?
When we talk about cloud based supply chain management, it refers to the solutions, systems, and protocols that help managers check the movement of products. They would rely on cloud computing solutions instead of on-premise equipment to keep track of inventory.
Business owners and supply chain managers can easily access the data from anywhere with cloud computing. Furthermore, it also provides redundancy with cloud backups. This way, the supply chain data is in their access at any time. This data is accurate and backed up for safety against theft and loss of damage.
Cloud Based Supply Chain Management: How Can Businesses Use It?
Many managers and business owners wonder how they can incorporate cloud chains into their supply chain operations. There are various cloud computing use cases for supply chain operations. Here are a few of them.
Automating Inventory Management
Using the right Supply Chain Management (SCM) cloud tools allows you to automate inventory management. You can use them to set up an interface that will reorder a stock upon reaching a certain stock level.
Furthermore, these tools also have options to connect cloud products to sensors. As a result, you can have a clear idea of their exact location when they’re in transit.
Carrying Out Data Analytics
Apart from cloud computing inventory management, they are tools that can help you effectively manage and assess data. With the analytical capabilities, you can use these tools to evaluate the data and get the most out of it.
For instance, you can assess data to analyze logistical costs, find out any incompetency, and learn about opportunities for improvement.
Forecasting and Predicting Future Trends
A combination of cloud computing and supply chain management can help business owners to analyze future trends. They can understand the customer demands and ensure they have relevant stock levels to meet those demands.
Moreover, it can also save them from stocking on products that are not hot-selling items. Most importantly, SCM cloud tools can help with effective resource allocation and management. It ensures you have a clear idea of how to manage your workforce.
Managing Maintenance and Equipment Breakdowns
It is vital to ensure your equipment and machinery are working properly. Cloud computing can be a useful solution as it can track the activities of various machines and report any issues, such as pressure drops, temperature anomalies, and much more.
This way, you can keep an eye out for potential issues and eliminate them before they turn into a big problem. It saves you from hefty repair or replacement costs for the equipment. Not only that, it can also reduce equipment downtime and ensure your operations continue to run smoothly.
What Benefits Cloud Computing in Supply Chain Offer?
The 2022 Accenture study shows that executives who use cloud technology from supply chain management have seen a 16% reduction in operating costs. Furthermore, they reported a 5% and 26% increase in revenue growth and demand forecast accuracy, respectively. Here are some more benefits of cloud based supply chain management operations.
Scalability and Flexibility
Cloud computing tools offer you great stability and flexibility. During the peak seasons, you can allocate more resources to ensure everything continues to work smoothly. When the demand is low, you can scale back things to reduce costs.
Cost Savings and Efficiency
As mentioned before, cloud computing in SCM can help spot any issues with machinery early on. This can help reduce the chances of hefty repair costs and ensure machines continue to work efficiently. Plus, there isn’t a need to spend money on physical servers and network equipment, leading to higher cost savings.
Better Collaboration and Communication
Cloud computing in the supply chain makes it easy to share updates and communicate with others in a synchronized manner. It paves the way for forecasting future customer demands and dealing with any challenges. The best thing is that it can unite different systems and teams.
Improved Visibility and Transparency
Last but not least, cloud computing offers better real-time access to data and analytics. Managers can access and check data from distribution centers, warehouses, and transport networks. The easy access to data for all stakeholders also increases trust. There can be fewer instances of confusion between manufacturers, retailers, wholesalers, or other stakeholders.
Bottom line: Why Combine Cloud Computing and Supply Chain Management?
Using cloud logistics software can help you leverage data to understand customer demands. It can help automate inventory management and offer greater control over your resource allocation. So, if you want to leverage cloud computing in supply chain operations, then Shispare is here to help you out.
