Cloud Computing

During the last 24 months, the interest in cloud computing which is a general term for software deployed through hosted, managed services and software-as-a-service (SaaS (News - Alert)) models has been growing continuously. Whereby making the movement of more business applications into the cloud, more prevalent. As per a recent report from ARC Advisory Group, the supply chain management market has grown by seven percent during the last five years, whereas the SaaS market comparatively has grown at a compound annual growth rate of more than 20 percent during that same period.

With the requirement for more reliable forecasts and rapid implementations, manufacturers are looking out for solutions that can leverage the benefits of supply chain planning applications without the requirement of the traditional investment of implementing on-site technology, whereby offering faster time-to-value and lower cost of ownership.

In a release, Kelly Thomas, the senior vice president of manufacturing at JDA Software said, "Cloud computing provides manufacturers new ways to benefit from a fast return on their supply chain management investment while avoiding hefty upfront hardware and infrastructure costs. As a result, manufacturers can improve forecast accuracy and provide more reliable demand visibility, which leads to enhanced customer delivery performance, improved cash flow and reduced inventory across the supply chain."

Some of the benefits of cloud computing for the supply chain highlighted by JDA Software are that the metrics are quantifiable. In the current dynamic business environment, the ability to deploy sophisticated planning solutions in a span of few weeks along with minimal staffing requirements creates an exhilarating new opportunity for manufacturers for rapidly optimizing operations, responding to new market challenges and reducing costs. This capability allows manufacturers to quickly generate reliable forecasts and optimized master production plans which are based on a global view of customer demand. By bridging the gap between front- and back-end planning, manufacturers are able to efficiently satisfy customer demand, at the same time improving overall profitability through better inventory investments. Some of the potential benefits of cloud-based solutions include improved sales, reduced cost of goods sold, increased asset throughput and a decrease in inventory.

Cloud-based supply chain solutions can provide strong supply chain and master planning capabilities based on a supply chain model.