Supply chain · 16 July 2015

Levelling the playing field: How the cloud helps small and large businesses collaborate

The cloud has provided small businesses with the opportunity to work alongside bigger names in the supply chain

We know that cloud computing has the potential to make businesses more responsive than ever – imparting the economic advantages that added speed, agility and flexibility bring with them. But, one area that is yet to be addressed properly is how cloud enables greater collaboration among small and large businesses seeking to trade on the international stage. Indeed, for entrepreneurial businesses and startups alike, there can be little doubt that cloud technology can hold the key to networking with more established enterprises in the supply chain like never before.

Today, thanks to falling costs, cloud computing means that a new generation of medium, small and even micro-sized enterprises can go from having no internal IT systems to being able to tap into the business software and collaboration tools that just a few years ago were exclusively available to the most well-funded and tech-savvy organisations. Now, the process of transacting and procuring goods and services anywhere in the world couldn’t be easier – they can simply plug into a cloud-based collaboration platform.

Through it, businesses of all sizes can receive orders, secure financing, organise transportation and receive or extend payments with ease and transparency. In the past, these business processes required a huge synchronisation effort. By making these capabilities accessible and affordable, not just to top-tier players but to all way down the supply chain, barriers-to-entry are reduced and all partners involved benefit from greater economic diversity. The benefit of removing the hassle of logging into proprietary portals for each customer in the network, each service provider or each bank when access to finance is needed, and the need to have a multimillion dollar software system in place to do so, isn’t something to be sniffed at!

By opening up the process by which networks of companies can collaborate, regardless of the IT applications they are each using, the cloud does not just level the playing field, but also streamlines trade processes in this globalised world of ours. Of course, with any type of new technology, attention needs to be paid to integration with existing organisational structures. It is relatively easy for startup companies to transition to the cloud, being able to implement “greenfield” platforms and essentially leapfrog entire generations of market development. In doing so, they can often avoid the long, costly stage of trial-and-error entirely. For larger organisations, the move may initially be more complicated, but I have to say that, again, the benefits of embracing the cloud as an essential utility for successful global commerce can end up easily outweighing any reservations.

This is especially the case for large, global manufacturers and retailers looking to Asian, Latin American and African markets for growth. Adopting the necessary local sourcing, local manufacturing and local customer support strategies in order to service a rising new class of demanding customers in these emerging markets is essential – and it takes time and work. But, in order to access the necessary, often vast, supply networks that are capable of delivering goods with speed and agility, requires the introduction of new partners. These new partners often come with different systems, data formats, languages and time zones. Unfortunately, for thirty years, global companies have tried to manage global commerce with conventional enterprise software systems. These systems have been widely successful in managing internal processes like HR, CRM, production planning or accounting, but engaging with outside customers and trading partners in a scalable manner can be another matter altogether.

As different as the paths of a small garment supplier in Bangladesh and a major US fashion retailer have been, it’s funny to think that they now find themselves in a similar technology position. One missed out on conventional enterprise software systems altogether – because of a lack of resources – while the other spent millions on software licenses, installations, upgrades and implementation only to discover that the inward-facing systems they have don’t help them collaborate. In both cases, a commerce platform in the cloud opens up opportunities.

The need to become a networked company has never been greater. Fortunately, when it comes to the supply chain, cloud-based utilities to connect trading partners from the smallest supplier to the largest multinational are already readily available. Ultimately, by embracing cloud-driven systems today, designed specifically for connectivity and sharing data across company and geographic borders, businesses of all sizes can work together with ease and on equal terms.

Image: Shutterstock

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ABOUT THE EXPERT

Kurt Cavano is the vice chairman and chief strategy officer of GT Nexus, a cloud based supply chain platform provider. It helps companies to manage their logistics and trade processes. Kurt is responsible for maintaining the company’s track record of innovation and market success, and for guiding key customer, industry and partner relationships.

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