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The Supply Chain Management Blog covers the latest in SCM strategy, technology, and innovation.

Market Study: The Future of SCM in the Cloud

Larry Simcox
Sr. Director

If you have been reading my blog recently you have noticed I am following the modern business transformation that is currently taking place and its impact on our supply chains. Cloud applications are a key technology enabler to modern business transformation, also called digital transformation. I recently attended a market study webcast (Replay available here) that was published by Inspirage Management Consulting Services, an Oracle Platinum Level member in the Oracle Partner Network (OPN). The downloadable market study focuses on the future of supply chain in the cloud. Inspirage conducted a quantitative survey and executive interviews of over 200 supply chain leaders.

The survey was looking to answer the following questions:

  1. What are the key challenges supply chain leaders face today?
  2. How are supply chain business and IT executives thinking about the cloud to address these challenges?
  3. In which areas are businesses adopting cloud solutions today? What is their strategy for the next 3 – 5 years?
  4. What concerns do they have that would prevent them from leveraging cloud technologies?

Here are some key findings I thought you would find interesting and also a link to the webcast replay.

  • Costs of Cloud: 81% of respondents stated that they hope to use cloud-based applications to not only improve internal operations but also reduce costs and inefficiencies.
  • Integration: Lack of system integration, forecast accuracy and demand variability, supply chain complexity, data integrity and lack of visibility across the supply chain were the top 5 obstacles for achieving supply chain goals and objectives. Ease of integration was listed as one of the top 3 important attributes in a new cloud solution along with security and total cost of ownership.
  • Security: The top challenge to organizations use of cloud is security or privacy risks. Some companies are new seeing better security in the cloud versus what they can provide themselves via their on premise solutions. One thing that raised my eyebrow was the fact that 33% of respondents indicated that they do not have a security strategy in place for cloud solutions.
  • Agility: Supply chain leaders want solutions that are not only deployed quickly but are also highly responsive for a distributed workforce and can scale easily. 23% of respondents indicated drivers of cloud computing want better scalability and availability and 13% responded the need for faster time to market for new product development and innovation.
  • Application Strategy: According to the study Inspirage expects to see a 46% increase in public cloud adoption over the next 3 years. Midsize companies are slightly more aggressive adopters of cloud with 57% using some form of cloud today moving to a strong majority of 82% using some form of cloud computing by 2018.

As you can see from this study it is not a question of if your company will be adopting supply chain cloud solutions but when you will be adopting supply chain cloud applications.

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