Significance of Cloud Computing for Supply Chains

finger touching screen

June 2012

Cloud was invented for supply chain collaboration, said e-Logics Managing Director Johann van der Westhuizen speaking at Cloud Africa, an event focused on how to harness the potential of Cloud to further telecommunications and ICT development on the continent.

"The minimisation of total inventory whilst ensuring that service levels are not compromised is a common supply chain challenge. This is further complicated by constraints such as lead times and capacity as well as the cost of different alternatives," he said.

It has been proven, van der Westhuizen explained that collaboration between supply chain partners significantly improves service levels and reduces costs, emphasising that collaboration requires the sharing of current data and effective communication of plans and actual activities.

"It is here that a Cloud solution can really add value," he said. "Such a solution offers the supply chain continuous and incremental planning. This improves visibility and enables early service failure detection, which in turn empowers proactive decisions and ensures the right corrective action."

By sharing (near) real-time data, planning can be successfully married with execution to enable the concurrent management of the variability in Demand, Supply and Lead Times. Supply chain executives, he added are provided with accurate information, which supports dependent processes and in turn, delivers improved supply chain performance.

One of the most attractive benefits of managing a supply chain in the Cloud is the rapid 'time to value'. In other words, companies are able to shorten the time between migrating management of the supply chain to the Cloud and gaining operational and financial benefits from the move.

"A Cloud supply chain management solution holds significant potential for Africa to leapfrog
the challenges of implementing capital intensive systems and the IT infrastructure to support it. If used appropriately, the Cloud will be a major enabler of African economic growth," he said.

On the ground challenges, concluded van der Westhuizen can be overcome by using the innovation that we have at hand today, saying: "In the world of logistics and supply chain management, the Cloud offers such an innovation platform."