Cloud Collaboration Increases Supply Chain Efficiency
Inbound Logistics, January 2017
by Dan Clark
Defined as the art of working together to produce or create something, collaboration has become a focal point for organizations that want to work smarter, better, and more efficiently in today’s competitive business world. Enabled by technology, companies and individuals are working together to achieve common goals, open new lines of communication, and foster both creativity and cooperation in new and previously inaccessible ways.
Collaboration is especially critical in the supply chain, where many different stakeholders play a role in the success of the larger “machine,” if you will. “Supply chains face a common challenge,” according to Accenture’s Supply chain management in the cloud report. “Detailed knowledge of operations is held locally creating silos—organizational, functional, and cultural—and these undermine effective collaboration between different elements of the supply chain, increasing the likelihood of problems emerging at a late stage, and limiting options for response.”
To overcome these challenges, procurement, logistics, accounting, merchandising, sales, and planning must be working from the same playbook on the internal side. Externally, suppliers, carriers, brokers, and other business partners all play their own respective roles in the success or failure of the overall supply chain.
We started seeing fewer “failures” when cloud computing came on the scene and delivered on its promise to connect all factions of the supply chain via the web. So rather than dealing with siloed entities that only talk to one another when they had to—usually via phone, email, or fax—companies started using sophisticated online platforms to enhance visibility and collaboration in real-time and on a 24/7 basis. In the grocery industry, for example, we’re seeing more companies moving away from traditional purchase order (PO) issuance via enterprise resource planning (ERP) or disparate legacy systems, and over to cloud-based solutions. Those solutions incorporate the structured and unstructured information stored in many different databases—and other pieces of information—and consolidate it into a single, central repository that’s visible to all supply chain partners in real-time.
To call cloud a breakthrough for supply chain collaboration would be a major understatement. By giving supply chain partners high levels of visibility, accurate information, and transparency in real-time, cloud computing improves supply chain efficiency for companies of all sizes and across all industries.
Suddenly, a company’s logistics department booking a $500 shipment with a specific carrier is seamlessly sharing that information to all key stakeholders in real-time. The company’s accounting department receives the agreed upon rate for audit and payment purposes. The executive management team sees that the shipment was booked at a $300 savings, because the logistics team had full visibility of all carrier rates and selected the best possible quote. Finally, the carrier itself has visibility of the shipment for scheduling purposes, track and trace updates, and invoice management.
On the supplier side, cloud collaboration eliminates numerous time-intensive, manual processes. When a buyer places an order in Kuebix for example, that information gets automatically integrated into a central repository of information known as a supplier portal. That portal gives the supplier real-time visibility over what was purchased to avoid issues like missed shipment promise dates and carriers coming to pick up freight that’s not yet ready to ship. This, in turn, results in higher levels of customer service and happier buyers.
Additionally, increased collaboration and communication between procurement and suppliers leads to better shipping decisions. A logistics planner who has real-time visibility over orders and shipments, for instance, can communicate with suppliers to adjust shipping schedules and consolidate freight into more affordable truckload (TL) opportunities. Or, maybe he or she can opt for LTL over high-cost parcel delivery methods. Whatever the scenario, having a collaborative, cloud-based platform helps all entities in the supply chain make better decisions that, in turn, result in improved efficiencies and reduced costs.
At last count, the worldwide public cloud services market was projected to grow 16.5 percent in 2016 to $204 billion, up from $175 billion in 2015, according to Gartner, Inc. As more companies realize that traditional communication methods like fax and email just don’t cut it in today’s business world, and as more of them replace their legacy technology systems with more sophisticated platforms, the benefits of cloud-based collaboration will increase exponentially.
Kuebix provides a disruptive SaaS TMS built on the latest cloud technology that is changing how companies purchase and manage freight. The Kuebix platform is unique in that it is well suited for smaller companies, but will scale for the largest enterprises or the most complex supply chains. Learn more about Kuebix at localhost:8888.
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