Why the Cloud Changes Everything

With the cloud, the supply chain industry can approach challenges from different angles and take advantage of new capabilities that were not possible before.

J Mel

In the days before the cloud, capabilities were extremely limited because supply and demand chains only had traditional IT systems, interfaces and infrastructures at their disposal. Once cloud computing came on the scene, the industry got redefined. Yet, it's important to note that the cloud is not merely an evolution of traditional IT; it's not simply a better, faster, cheaper data center in the sky, nor is it the same as the old IT, but squared or cubed. The cloud is a quantum leap. With the cloud, the industry can approach challenges from different angles. Foundationally, the cloud has enabled totally new capabilities that were not possible before.

The benefits the cloud offers supply and demand chains

Two significant benefits the cloud provides to the supply and demand industry are data and automation. In the past, data was an endless ocean of information, which concealed insights, but gleaning relevant data was difficult. Now, through cloud computing, Internet of Things (IoT) devices, sensors, GPS devices, RFID and anything else producing information can all be compiled into one place. Then, through artificial intelligence (AI) data mining, machine learning and deep learning, companies can leverage the cloud to extract value more quickly and easily.

Cloud automation, particularly automation across the whole chain, allows for responsive non-human systems to independently complete tasks without direct human interaction. It has accelerated dozens of processes from warehousing to transportation. For example, today, some physical warehouses can have a data or digital warehouse behind them capable of notifying businesses of peaks and anomalies, making it more valuable than the actual warehouse it supports. Additionally, automation can take people out of their menial, manual and repetitive tasks and free them to focus on the things that a computer can't do, such as more creative, strategic and customer experience-oriented tasks.

Outside of data and automation, the cloud gives unlimited storage and unlimited computing power, allowing for innovations that were unthinkable before. It also provides a true value proposition through collaboration, making joint decisions absent of silos, driving actions across the enterprise while aligning towards a common goal.

The cloud and its new systems operate on real-time sensing and responding to changes in the current environment, which could be anything from weather, social attitudes, competitors' prices or other dynamic elements. Using dynamic point-in-time data, AI predictive analytics and machine learning, a business can build a demand and supply chain that is more responsive, resilient and agile than ever before. 

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Transitioning to the cloud

Before businesses get overzealous and find themselves as the builder who started a project without enough funds or resources – it's necessary to make the appropriate preparations to avoid the common mistake of attempting to use cloud-like features without first establishing the cloud as a foundational supporting element to business processes.

Making the right decisions during digital transformation is essential. Taking old data from a traditional data center and shoving it into the cloud does not make someone a cloud-enabled digital business - the whole approach is different, from data structures to data cleansing. While the shining city on a hill that is a cloud-reliant enterprise is dazzling, getting there is less than trivial.

Without the proper guidance, support and tools, the success of cloud transformation is relatively low. Plenty of organizations have begun the migration process to the cloud, then declared that it was too hard, too slow and too expensive. These companies may have put a few applications in the cloud, but they didn't have a transformation sequence, timeline or roadmap figured out beforehand. 

The migration and integration to the cloud are step zero – it must happen first before anything else. Implementing the cloud is foundational to everything else a business wants to achieve digitally. The cloud is the building block and whatever it takes to get it right the first time is well worth the effort. And for those who have implemented the cloud correctly, the results speak for themselves. Leaders in supply and demand chains have reached a point where their core business processes are not possible without cloud-enabled services.

The risks of transitioning halfway or haphazardly into the cloud

Understanding that the cloud is a supporting tool and an enabler of the core business is essential for success in the supply and demand industry. If not treated as an enabler, companies can fall into the trap of using the cloud for the cloud's sake. On the opposite end, an enterprise should avoid being a kid in the candy store when they get into the cloud; buying every application will lead to the respective cloud provider sending an expensive bill at the end of the month. It's critical to be selective and purposeful when building a system inside the cloud. Similarly, entering the cloud without a plan will ultimately lead to failure and a tremendous waste of money. It's not enough to know that the cloud is a solution – one needs to know how it is a solution.

Another risk of haphazardly transferring to the cloud involves employees. Transforming systems and technology is easy; transforming processes and people is much more challenging. Preemptively preparing employees for the change to the cloud through training will prevent potential drops in productivity and accelerate digital adoption. Moreover, wrongfully integrating the cloud into processes could mean that future projects will be unnecessarily inefficient, requiring huge amounts of rework. Supply and demand enterprises shouldn't pursue cloud migration to emulate other companies but from a desire to improve and support core business processes. 

Partnering with the right database and applications provider 

Over the last five years, everything that was helpful for supply and demand chains got built inside the cloud. One can't do a modern high-tech innovation outside of the cloud anymore – nonetheless, migrating to the cloud is an intimidating procedure. Although the benefits far exceed the risks, pairing with the right partner can mitigate mistakes and reduce the complexities of planning and effectively migrating to the cloud.