How to Utilize the Cloud to Connect Your Global Supply Chain

By Karthik Srinivasan  |  Posted 2010-10-20

How to Utilize the Cloud to Connect Your Global Supply Chain

There are a number of operational and strategic limitations in many of today's global supply chains. The continuous globalization and outsourcing of today's value chains have only made matters worse, increasing both complexity and risk.

It is no surprise then that the traditional product capabilities and delivery models are being scrutinized by both business and IT teams-particularly for functions that require comprehensive process orchestration and data integration across the extended value chain.

Now, as demand finally begins to pick up, it is imperative that companies leverage the lessons learned from the recent past to reassess and redefine their end-to-end processes and technical strategies. Cloud-based, multienterprise business process platforms provide an increasingly viable option for companies hoping to drive new levels of business synchronicity and collaboration between partners in the global community, resulting in rapid ROI and lower TCO.

In this article, I will focus on three core aspects of cloud utilization that are essential for building nimble, efficient supply chains in today's marketplace. Let's start with the first aspect: integration of partner assets.

Aspect No. 1: Integration of Partner Assets

Aspect No. 1: Integration of partner assets

Since 50 percent of the data in ERP systems today originates outside the firewall, it is important that enterprises take a fresh look at their data integration and acquisition strategies so that every constituent in the value chain is working off of a "single version of truth." Distorted customer demand pictures lead to incorrect supply planning and, ultimately, to inefficiencies in the supply chain. Cloud-based integration solutions are built from the ground up, and reach far and wide into the value chain to provide:

1. A more timely and accurate picture of demand and supply through comprehensive protocol support, from FTP and electronic data interchange (EDI) to Web services, as well as standard, prebuilt adapters for various back-end enterprise applications

2. Tools and self-service capabilities for faster end-to-end partner registration, discovery and onboarding processes

3. Transformation services for better management of variations in business documents

4. Higher order business process orchestration and composition

5. Information transparency through dashboards and service-level agreement (SLA) reporting

Cloud vendors that offer these features (in combination with an extensive network of interconnected partners) enable reuse, harmonization of content, and real-time collection of information across a federated network of partners to drive a more responsive supply chain.

Aspect No. 2: Collaboration of People and Processes Across Entire Value Chain

Aspect No. 2: Collaboration of people and processes across entire value chain

Once enterprises gain access to transparent, shared information, the next step is to enable the correct controls to ensure that the information is leveraged effectively. One of the many virtues of multienterprise collaboration (although less understood) is that it serves up clean and actionable data, enabling a better sense-and-respond network.

Most importantly, up-front collaboration enables back-end enterprise applications to function more effectively. Enterprises need to extricate themselves from the landlocked, internal architectures and embrace the cloud for collaborating across a distributed network of partners to drive better results. Cloud-based, multienterprise solutions eliminate potential collaboration hurdles across distributed teams and deliver:

1. Complete visibility and control of the partner network

2. Workflows that seamlessly and rapidly connect people and processes across multiple tiers in the ecosystem

3. Partner adoption and "stickiness" by providing various means of collaboration via both connected and disconnected modes, including Excel clients, mobile devices, e-mail and user-configurable Web user interfaces

4. Clean, reliable data that improves internal planning processes and execution efficiency

Supply chain collaboration is about collaborative business processes; that is, processes that inherently live in the network and support the all-important value proposition of providing clean data to gain near-real-time visibility and control across the extended network.

Aspect No. 3: Operational Business Intelligence for Proactive and Rapid Decisions in the Network

Aspect No. 3: Operational business intelligence for proactive and rapid decisions in the network

Clean and timely data flowing through the value chain provides an opportunity for analytics and reporting that can propel network BI or, more generically, operational BI. While traditional BI will continue to be important and strategic-particularly for large businesses-companies can benefit significantly by investing in enterprise-wide information architectures that support both forms (traditional and operational). Cloud-based, operational BI leverages network data to provide:

1. The capacity to react quickly to business needs and to anticipate business problems before they negatively impact value chain operations

2. Extended use of BI to a much wider audience to enable the ecosystem to be proactive as opposed to reactive

3. Information tailored to the user or partner in order to effectively accelerate the decision-making process and enable a truly "intelligent" value chain

Of course, migrating to the cloud does bring with it a number of potential challenges. For instance, most CIOs and enterprise IT professionals cite concerns around security, data loss, SLAs and data ownership. The truth is, not all business applications or processes may be ideal for the cloud at the present time.

However, the business benefits and economics of cloud-based, multienterprise solutions will effectively resolve these concerns over time, as it is the industry thinking that needs to change, not necessarily the technology. Looking forward, cloud computing will play an increasingly critical role in supply chain management operations, as companies look to evolve their technologies to deliver more nimble, optimized and adaptable value chains.

Karthik Srinivasan is Chief Technology Officer at E2open. Karthik is responsible for leading and establishing E2open's overall technical strategy. Karthik brings over 18 years of experience in the delivery and support of mission-critical software for Fortune 500 customers worldwide. During his tenure at E2open, Karthik has held a variety of customer-facing roles, leading the principal engineering team and product management, where he built the industry's first private directory based on Universal Description, Discovery and Integration (UDDI) (patent pending). Karthik has managed multiple customer implementations, and continues to provide technical leadership in sales, marketing and standard bodies.

Prior to joining E2open in 2001, Karthik was vice president of technology at Citibank, responsible for the implementation of mission-critical solutions for global corporate banking in distributed environments. At Citibank, Karthik helped create a common platform based on Distributed Computing Environment (DCE), ENCINA and CORBA for enterprise applications, and built mission-critical applications for Citicorp global finance. He can be reached at 

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