How cloud computing is improving logistics, procurement process

On the surface, cloud computing offers organizations the chance to aggregate, share and analyze more information. The question is, how can this convenience take the procurement process to the next level?

Simplifying complexity

Global sourcing isn't a difficult concept to grasp, but it's incredibly hard to put into practice. A single enterprise could have thousands of direct and indirect connections with suppliers located across different parts of the globe.

SupplyChainBrain interviewed UPS Vice President of Supplier Management Tom Boike, who noted that cloud computing can bring clarity to a befuddling, intricate web of relationships. How is this made possible? By being able to aggregate a plethora of digital information on every partner.

Exercising sustainability

Consumers and enterprises pay more attention now than ever to the organizations with which they're conducting business. The Internet has made it easy for people to find out whether a company's practices are detrimental to the environment or indirectly support global conflict. There are two ways in which cloud computing can help organizations employ sustainable practices:

  1. Greater energy efficiency: According to a 2012 study conducted by the Natural Resources Defense Council, because cloud environments are powered by the shared server capabilities of multiple organizations, they use less energy than conventional data centers. In addition, because workloads can be assigned to multiple participants, cloud technology can be powered by variable energy sources such as wind and solar.
  2. Better oversight of best practices: By allowing themselves to collect more data from different sources, organizations can quickly identify trends in how companies interact with the world around them. For example, a diamond seller could use cloud computing to collected data on all its suppliers and then see whether or not those partners are sourcing minerals from conflict areas.

Increasing port efficiency

According to Forbes, the Chinese city of Ningbo, a bustling logistics hub with nearly 5,000 companies that have a stake in the port's success, recently installed a cloud infrastructure with the help of IBM. As a result, the number of idling vehicles has decreased while the flow of goods was expedited.

The news source noted that the system enabled enterprises participating in the program to install GPS sensors on all of their trucks. This enabled one company to reduce idle time by nearly 80 percent, accumulating about $157,000 in savings.

Electronic procurement services offer corporations the same solace as cloud computing by connecting them with millions of potential suppliers around the world. Experts offer the software and tools necessary to obtain the correct cloud platform solution and make the most out of it.

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