Cloud computing is one of the advancements, which have significantly transformed the manner in which several companies manage and access information within and outside the firm. In general, this technology allows an organization to access its information technology services like, applications and infrastructure through the internet.
For this reason, companies adapt to ever-changing business environment and create better opportunities by opening up the market. Massive use of internet technologies is considered as one of the reasons why most firms find it easier to use cloud computing in supply chain management (Kefer 2012).
Additionally, companies prefer using cloud computing because it offers opportunities to market new products with a lot of ease. In fact, it is believed that most supply chains have been put under pressure because of the pace at which most products and services are being introduced.
It is important to underscore the fact that there are several ways through which cloud computing works in supply relationship management. These can be understood by focusing on how LyondellBasell has successfully incorporated the technology in its daily operations. The company specializes in plastics and chemicals, and sells its products in more than one hundred countries around the world (Kefer 2012).
LyondellBasell uses cloud computing to manage its supply management relationship because of the involvement of multiple organizations, which have to access unique information, depending on the products being channeled to consumers. In essence, this technology allows a firm to develop a platform, which promotes the company’s visibility and control of crucial elements. Consequently, LyondellBasell is able to oversee international logistics and has opened the tender process by attracting an array of partners.
The main reason why several companies are investing in cloud computing is based on the overall implications of the technology. It has been found out that “icloud” has a wide range of benefits in the management of a company and its suppliers. Firstly, it augments a company’s visibility within the market.
This is essential in cases where supply chain reliability and agility are needed due to expansion. In most cases, cloud computing ensures that there is a single source of trusted information needed by partners. It also gives updated information, regarding real-time delivery of products, to allow monitoring during their supply.
This ensures that delivery-delays are eliminated, thus improving customer service and loyalty, coupled with proper management of expectations. In addition, cloud computing allows effective marketing of new products and services in the market. This is made possible through instant access of information by independent organizations and partners, within the entire market. It also enhances large-scale transformation, since icloud-based supply chain solutions have the potential of promoting business competition (Reddy 2011, p. 7151).
Despite the fact that cloud computing has an array of advantages, there are several challenges faced by companies, which have adopted this technology. Like in most cases, massive use of the internet exposes products and the company’s data to cyber threats. Without proper protection, companies are likely to lose customers, data and products, which may have serious implications.
Based on these, companies are forced to invest in protective cloud infrastructure to promote the security of business transactions (Gold 2012, p. 24). With regard to supply chain, companies are faced with the challenge of remaining flexible and predictable in the business market. This is essential in promoting the relationship between the company and its suppliers.
Reference List
Gold, J 2012, ‘Protection in the cloud: risk Management and insurance for Cloud computing’, Journal of Internet Law, vol. 15 no. 12, pp. 23-28.
Kefer, G 2012, Three Ways Cloud Computing Can Improve Supply Chain Operations for the Chemical Industry. Web.
Reddy, K 2011, ‘Security Architecture of Cloud Computing’, International Journal of Engineering Science and Technology, vol. 3 no. 9, pp. 7149-7155.