Key Takeaways
Real-time Data Visibility: Cloud migration provides constant access to real-time data across the entire supply chain leading to more informed decision-making.
Improved Collaboration: Moving data to the cloud improves collaboration among stakeholders.
Increased Cost Savings: Scale based on demand and pay-as-you-go. Moving to the cloud will lower your company’s capital expenditures and maintenance costs.
An increasing number of companies are moving their data to the cloud along with their IT infrastructure and mission-critical applications. While specific reasons vary from company to company, there are some common reasons that broadly apply. Cloud providers can offer robust disaster recovery and backups that are hard to replicate in-house. If your main production environment goes down for any reason, a failover system can ensure your system can pick up right where things left off. In the event of large-scale damage, disaster recovery services accomplish the same.
Those benefits aside, as with many areas of business, a main benefit of cloud migration simply comes down to cost. Cloud services allow companies to save money. Your organization won’t need to maintain hardware in-house.
Cloud technology is revolutionizing supply chain management. It gives companies a much better view into the supply chain because of real-time data visibility. The end result is improved collaboration with stakeholders and other relevant parties at all points along the supply chain. With cloud migration, supply chain management improves greatly.
Enhanced Data Visibility and Accessibility
Cloud migration facilitates real-time data access across the supply chain. Cloud-based solutions allow companies to integrate data from multiple sources, including suppliers, manufacturers, and distributors, into a single platform. This results in a unified view for all stakeholders. Prior to the emergence of cloud technologies, supply chains were based on siloed data and involved many manual processes. The cloud changed all that. The enhanced visibility offered allows companies to more quickly identify inventory shortages, supply chain disruptions, and related issues. As a result, key decision makers are able to make more informed decisions based on this information.
Improved Collaboration and Integration
Cloud platforms enhance collaboration between suppliers, manufacturers, and distributors. The unified view described above eliminates communication gaps and related issues. Integrated cloud systems streamline operations. Collaboration between suppliers, manufacturers, and distributors improves because all parties can access shared data.
The benefits of cloud technology in logistics don’t end there. The disjointed nature of traditional supply chains resulted in many inefficiencies, but the cloud helps reduce or eliminate those inefficiencies. It’s extremely beneficial when all parties have access to order statuses, production schedules, and inventory levels.
Scalability and Flexibility Benefits
The scalability of cloud solutions offers a distinct advantage, specifically allowing businesses to adjust resources based on demand. Businesses can change their computer resources based on demand, scaling up or down as needed. The number of servers, storage, and network bandwidth can all be adjusted as needed.
This flexibility supports seasonal fluctuations and market changes. When a business is experiencing a surge in demand due to seasonal fluctuations, they can scale up accordingly. Then once the seasonal demand declines, they can dial it back down and not be committed to paying the higher rate needed temporarily during their peak season.
Cost Reduction and Operational Efficiency
Cloud migration can lead to significant cost savings in areas like IT infrastructure and maintenance. Moving to the cloud results in a decrease in capital expenditure (CapEx). The upfront investment in maintaining data on-prem is significant. The cost of hardware, including servers, storage devices, and networking equipment adds up quickly. That doesn’t even factor in the cost of software and future hardware maintenance. When you make the move to the cloud, your cloud provider will handle all of that leading to reduced CapEx and lower maintenance costs.
Cloud migration reduces lead times. Your organization will be able to deploy IT resources and applications much more quickly. Inventory management becomes easier as well. Due to real-time visibility into the supply chain, cloud integration allows your organization the most up-to-date information on order statuses and inventory levels.
Challenges of Cloud Migration
Despite the benefits of cloud-based supply chain management, moving data to the cloud does not come without some challenges along the way. Common challenges your organization could experience during cloud migration include data security concerns and initial integration issues, among others. If you want to ensure a smooth cloud migration, you’ll need to pay attention to mitigation strategies.
You’ll need to take extra care to ensure sensitive data is protected from authorized access. When choosing a cloud provider, make sure they use robust security measures including but not limited to data encryption and access controls. Also, determine if they comply with established standards in your industry. This can save a lot of compliance-related headaches down the road. It’s important that you encrypt your data while migrating but also at rest once migration is complete.
Case Studies: Success Stories of Cloud Migration
There are some well-known, real-world examples of companies that have successfully migrated their supply chain management to the cloud. Coca Cola’s cloud migration story is perhaps one of the most interesting stories that demonstrates the benefits of cloud in supply chain. Keep in mind Coca Cola has 900 bottling plants throughout the world!
In 2012, Coca Cola ran an during the Super Bowl to encourage everyone to vote online for their top choice of different commercial endings. The resulting surge in traffic caused significant delays and a frustrating experience for users. Coca Cola’s environment was in premises at the time. This experience made it clear that a move to the cloud was necessary. The company’s move to AWS for cloud services helped them achieve a 40% operational savings.
Conclusion
It might sound cliche, but the impact of cloud migration on supply chain management is nothing short of transformative. Maintaining data infrastructure in the cloud has enabled businesses to collaborate better and have better data visibility. Both lead to improved supply chain management and cost savings.
Your business should consider the strategic advantages of moving your supply chain operations to the cloud. The end result is cost savings and improved operational efficiency.
