Embracing the Cloud for Supply Chains


May 25, 2023

More companies are recognizing the benefits of automation, supply chain visibility, and streamlined communication and are implementing the cloud to gain the operational efficiency they need.

According to a study of global cloud usage among businesses, enterprise spending on cloud infrastructure equaled $178 billion in 2021, up from $1 billion in 2009. The steady spending increase indicates that organizations realize their need for modern, cloud-based supply chain solutions that can meet their connectivity and visibility needs.

When it comes to switching your supply chain to the cloud, the time is now. Cloud computing solutions are one of the most widely implemented technologies by supply chain companies, with 40% already utilizing them in 2021 and 86% planning to use them within the next five years.

As supply chains grow in complexity, customer demand shifts quickly, and supply chain disruptions become more common, moving to a cloud supply chain is the right choice. Before you can leverage the cloud, it’s essential to understand why you should embrace cloud computing in your supply chain and where the best opportunities for integrating the technology lie.

Why Embrace Cloud Computing in the Supply Chain

The numerous benefits of a cloud supply chain include increasing supply chain visibility, improving security and scalability, and streamlining communication. Now is the best time to take advantage of these benefits for your business.

Consider a few reasons why you should embrace cloud computing in your supply chain:

1. The Cloud Provides Critical Supply Chain Visibility

Supply chain visibility is vital for companies that want to stay ahead of surprises such as unexpected shifts in customer demand. Visibility is crucial for overcoming common business obstacles, like preparing supply chains for a recession and improving inventory forecasting and management.

A lack of visibility at any point along the supply chain can result in long-lasting consequences, such as the supply chain bullwhip effect. Utilizing cloud computing can help you immediately gain insight into your supply chain, from illuminating sales trends to increasing transparency between customers and suppliers.

2. The Cloud Improves Supply Chain Flexibility

The past few years have brought companies significant supply chain challenges, such as shipping delays, evolving trade regulations, and rapidly shifting demand. With so many changes impacting supply chain management, flexibility is no longer an option. You need responsive tools to adapt to immediate changes rather than drag behind the competition.

Cloud-based solutions are vital to creating a resilient supply chain that can handle current and future challenges. For example, Electronic Data Interchange (EDI) enhances supplier collaboration and allows you to streamline the supply chain. A tool such as Vendor Managed Inventory (VMI) helps you improve demand forecasting and reduce inventory costs.

3. The Cloud Streamlines Supply Chain Management

The Cloud Streamlines Supply Chain Management

You must ensure you get the correct quantity and type of product to the right place at the right time to drive supply chain efficiency. However, manual supply chain processes are becoming more difficult to sustain. A volatile market makes it challenging for companies to stay on top of demand shifts and optimize their supply chains at every step.

The cloud is critical for optimizing supply chain management. Automation through the cloud allows you to standardize communication, integrate your digital sales channels for better inventory management, and leverage data for more insightful decision-making.

4. The Cloud Enables Greater Connectivity

Gathering analytics is crucial at every stage, from manufacturing to product delivery, helping businesses minimize lead times and create lean supply chains. Managing a global supply chain efficiently requires high connectivity to keep your trading partners and systems on the right track.

By embracing a cloud supply chain, you are empowered with immediate connectivity throughout your supply chain. The cloud enables you to collect and analyze raw data from across your supply chain so you can make more proactive supply chain decisions and prevent issues before they arise.

Where to Embrace the Cloud in Your Supply Chain

Companies implement the cloud at every stage of their supply chains, from manufacturing to distribution. As a supply chain manager, you need to know where integrating the cloud in your supply chain can be the most helpful.

Here are some of the most valuable areas in which to embrace the cloud in your supply chain:

1. Trading Partner Communications

Efficient supply chains can accurately determine customer demand and fulfill it with the available inventory across multiple sites to get products to customers as quickly as possible. For the supply chain to work, you need effective communication between trading partners and their systems.

One of the best places to integrate the cloud is your trading partner communications. A cloud-based EDI solution simplifies document sharing and order processing between trading partners and offers scalability so you can handle a growing transaction quantity.

The solution integrates directly with your ERP to speed up turnaround and eliminate manual processes. If some of your trading partners have different levels of technological maturity or use different systems, a supplier enablement platform standardizes transaction data for your ERP and makes it easier for you to automate document exchange.

2. Inventory Management

Knowing how to improve inventory management is critical for optimizing your supply chain. Fortunately, the cloud simplifies inventory management, helping you navigate lead time fluctuations and changing demands. Cloud solutions use automation to regularly analyze and enhance inventory data for the best inventory management results.

Using VMI lets you share inventory data with trading partners in real time, giving each partner access to data such as products on hand, on order, and sold. The software produces recommended replenishment orders based on mutual trading partner objectives to improve inventory management and optimize availability.

3. Order Fulfillment

Accurately capturing and filling orders is critical for meeting customer expectations. Yet as you gain new customers and expand into new channels, order fulfillment can become challenging. Errors or delays in order fulfillment can also have a ripple effect along the supply chain. That’s where the cloud comes in.

The cloud enables you to accurately predict demand and track orders across an increasingly complex supply chain. The flexibility of a cloud-based VMI solution allows businesses to react to demand changes and meet immediate needs quickly.

The cloud also provides complete visibility along your supply chain. EDI grants insight into transaction processing, while warehouse management systems provide visibility into product locations within the warehouse, allowing you to fulfill orders quickly and efficiently.

4. eCommerce Customer Data

With multiple online storefronts to manage, companies could easily be overwhelmed by the volume of customer data they handle daily. Using the cloud to integrate eCommerce storefronts with your ERP and other business systems makes managing customer data easy.

eCommerce integrations connect your business systems with your online storefronts to keep all customer orders formatted for your network. The solution streamlines order processing and supports your business system for peak efficiency and better customer retention.

Leverage the Cloud to Optimize Your Supply Chain

The cloud has completely changed supply chain management, and now is the best time for you to start utilizing its benefits for your business. TrueCommerce provides the cloud tools you need to start streamlining your supply chain, offering robust solutions such as a cloud-based EDI system that takes your supply chain into the future.

To learn more about our cloud supply chain management solutions, contact our team today.

Leverage the Cloud to Optimize Your Supply Chain

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