1. Cloud: Key to Supply Chain
Purpose
The purpose of this white paper is to bring attention to the prevailing SMEs and mid market enterprises about
cost effective Supply Chain solutions that help them to manage day-to-day operations and processes efficiently.
The proposed solution, at the same time, also provides the needed insight and intelligence to successfully adapt
to fluid business environment, and ensure compliance with regulatory requirements.
Introduction
Small and medium enterprises (SMEs) are in difficult quandary in today’s exigent economic environment. It’s no
more business as usual; companies struggle on how to optimize for today, and get on track to capitalize on new
opportunities that will emerge as the economy grows. They need business solutions to help them to manage
more efficiently day-to-day, and also provide them with the intelligence they need to move the business
forward.
This is the time when companies need to understand their supply chains better. Supply chains over the years
have become lean as a result of cost cutting exercises performed. Result: there is negligible scope of coping up
with variations in demand or with unexpected events. The recent crisis over Europe because of Volcano eruption
in Iceland actually demonstrated this at a global level. So, companies in future need improved visibility in their
Supply Chains. This requires two things, on one hand, development of a “collaborative sourcing” approach, and
on other, establishment of an infrastructure allowing the exchange of information across the supply chain
ecosystem.
As SMEs evaluate different options, total cost of ownership (TCO) is often top of mind. Many customers have
become interested in how cloud computing or software-as-a-service (SaaS) can help lower their costs by
eliminating upfront capital investments, very unpopular these days and ongoing maintenance costs associated
with on-premise solutions.
SME and mid-market organizations need solutions that enable them to meet their business goals, and also help
them to conserve capital and reduce ongoing costs. For many customers, cloud computing business solutions
can help organizations to achieve these requirements, and provide added flexibility to scale as business
demands require.
Cloud computing essentially eliminates the need for customers to buy, deploy and maintain IT infrastructure or
application software individually. Regardless of the application, the cloud computing vendor takes responsibility
for all of the infrastructure required to run the solution-servers, backup, software, operating systems, databases,
updates, migration, power and cooling, facility space, etc., and associated internal and third-party staffing costs.
Because cloud computing vendors manage all of their customers on a single instance of the software, they can
amortize costs over thousands of customers. This yields substantial economies of scale and skill, and lowers the
TCO.
Problem Statement

2. This whitepaper is written with an intention to promote a supply chain business solution for several
organizations which are facing challenges in terms of buying, deploying and maintain IT infrastructure or
application software. An attempt has been made to identify certain business related and technological
challenges in subsequent paragraphs.
1. Key Business Challenges
Following report from an Aberdeen survey highlights some of the key challenges from the business angle that
companies today are facing.
Business Challenges Description
Cost to purchase and deploy Traditionally enterprises deploy solutions on their own servers, owns the
traditional on-premise SCM software, bear the cost of hardware, licenses, infrastructure and
solutions deployment
Increased supply chain complexity Understanding and managing the drivers of supply chain complexity is
important for an organization to progress towards cost effective and
optimized solution
Speed of change in supply chain Today’s rapidly changing economy - rapid price fluctuations, surging oil
design requirements and network prices, global competitions and hence, supply chain creates a stress on an
enterprise to respond quickly and effectively
Rising customer collaboration The increase in competition, rising customer expectation and complex
requirements regulatory compliance have to be pressed with excellent customer
collaboration and document management
Rise in length of IT backlog and There is no SaaS based solution which is end to end, there are piece meal
time to implement new solutions solution such as standalone TMS solution, WMS and time to implement
each solution and the interfacing between the same is significantly high
Rising customer service Customers keep raising the bar of their expectations as consumers grow
requirements richer, are better informed and travel more

3. Business Challenges Description
Faced with the pressure to raise the Customer Service standard of
excellence, businesses are not able to meet the demands
Restricted to single channel Currently, many organizations still have a single channel of fulfillment and
fulfillment are hesitant to move towards multiple channels due to economic pressure
Lack of Inventory visibility and Poor inventory availability and optimization leads to lack of retail supply
optimization chain responsiveness towards short-term demand adjustment
Inadequate order fill rate The unawareness of missing/damaged inventory lead to inventory
promising situations and non-fulfillment/delay in fulfillment of the same,
which leads to customer dissatisfaction and loss in revenue
Inadequate inventory forecasting Improvements in accuracy mean cost savings
Getting better at anticipating demand and being in the right place at the
right time with the right goods and services
Inadequate Returns Management Inadequate returns management drives the management to over invest
capital in their business, they try to balance the risk of inadequate returns
with the cost of holding capital
Improper warranty management Increased warranty costs and customer dissatisfaction can result from
improper warranty servicing
Lack of capability to provide Lack of the ability to budget, account, or charge for the value of services
effective value added services leads to loss in revenue
Issues in tracking inventory ageing Manual operations currently followed does not bring highlights to
inventory ageing which can lead to inventory promising situation but un-
fulfillment of the same resulting in customer dissatisfaction
Not able to do Drop Ship Lack of effective collaboration between vendors does not bring correct
inventory information- which can either lead to inventory promising
situation but un-fulfillment of the same or the customer is not promised
inventory though the inventory might be available to promise
KPI Analytics Industry standard KPIs like Ontime shipment, Inventory count accuracy , On
time receipts, Order picking accuracy etc..define the status of an effective
supply chain. A customer might not have analytical capabilities to capture,
cleanse and infer these data elements. The proposed solution will provide
the customers on demand data elements for these KPIs, enabling them to
gauge the effectiveness of their current supply chain and also the
corrective measures.
Promotions The purpose of the promotion process is to align and create synergies
between systems and people to execute successful promotions and
maximize on-self availability. The promotion process involves cross
functional working and multi channel communication this makes the
execution of the process complex. The intention of having such a structure
is to drive sales by increasing the attractiveness of the customer offer.
Typical promotional challenges are :
Multi channel communication not synergized
Non availability of accurate data (sales trends, demographics etc) for
planning a promotional event.

4. 2. Key Technical Challenges
Technical Challenges Description
System Up Time Uptime is a measure of the time a machine has been up without
any downtime. It is imperative for the proposed solution to have and
sustain industry standard up times as this will be a multi tenant solution.
Important challenges for system up time are :
o Planning and scheduling downtime
o Reliability Centered maintenance
o Productivity maintenance
Lack of technical support and Organizations do not have sufficient product and technical knowledge,
people dependency have high support needs and bear upgrade costs.
Coping up with System Upgrades Whenever product’s newer version enters the market and it is understood
to suit the requirements the better, again huge cost and time is involved in
product upgrade
Integrated Solution If multiple applications are implemented as a solution, the integration
between the same involves high service cost, integration difficulty, and
technical requirements.
Solution
An ideal solution is to provide a secured, managed environment that customers (or groups of customers) can
use to perform specific functions. Solution needs to have an option to increase and/or decrease computing
capacity in function of the needs at any given moment in time and charging customers on a pay-per-use basis.
This is ideal to build a Supply Chain Cloud, which the customers of a specific ecosystem can securely perform
transactions, exchange information and analyze it for trends, reports etc. without adding to the TCO.
Supply Chain Management on Cloud
A best-of-the-breed (BoB) standalone solution can be identified in each area to meet the complete end-to-end
requirements in supply chain: E-Commerce (Order Capture), Customer Order Management, Customer
Relationship Management (CRM), Warehouse Management System (WMS), Transportation Management
System (TMS), along with Business Analytics capabilities – all integrated and placed on Supply Chain cloud.

5. What is SCM on Cloud?
Cloud Users
Security
SCM Cloud
OMS, Order Capture
WMS/TMS/CRM Analytics
Infrastructure Cloud
Desktops Storage Servers
10
Some of the potential BoB solutions like Manhattan WMS, Red Prairie, Sterling MCF for supporting warehouse
management activities, Sterling DOM for Order Management, Google maps and the respective API’s for
geocoding and providing the solutions for transport management can be hosted on cloud and the same instance
can be used for multiple vendors on a transaction based model.
Small and Medium Enterprises generally do not want all the solutions and each functionality within each
solution for their business, they do not want to spend huge chunks of money for the implementation of BoB
solutions.
It would be highly attractive to such enterprises to access only the services required by them from cloud on “as
and when” basis.
Service Offerings
Apart from the solution on cloud, there can be more service offerings like Process Consulting, Support and
Supply Chain KPO as there would be domain and technical consultants available to support the enterprises
whenever the business needs them.
Unique Business Benefits
Supply Chain cloud is an attempt to build on customer’s business strategy and lead it to competitive advantage
by leveraging IT to drive increased value across the value chain.
1. BoB Scalable & Reliable Solution

6. • BoB Solution under one umbrella
Different areas of Supply chain would be catered by best of breed solutions under one cloud and
business would be able to access the benefits of each solution, almost with negligible cost as compared
with, if business had all solutions implemented on his own hardware. Small to medium sized enterprises
would be able to afford the same rich and sophisticated solutions as the multi-billion dollar enterprises.
• Solutions Scalable as per the need of business
The solutions implemented would be flexible to accommodate new expansions/business in a very short
span of time.
2. Reduce CAPEX, TCO
• Reduce initial investment and TCO.
There would be no capital investment in hardware, no software license investment, no infrastructure
foot-print which would bring down the initial investment cost to almost 25% of TCO.
• Translate user subscription to licensing cost.
Monthly subscription fees replace perpetual fully paid licenses, allowing organizations to recapture
solution costs through efficiency savings and other benefits as they go.
3. Role Based Access
• Granular administration of user and group privileges is very important for internal security and the
accounts can be customized to display specific types of data.
4. Seamless Integration
• Ensure seamless integration with customers IT ecosystem.
Everything is subject to change. Seamless Integration means making a change without error or
interruption in service. The enterprise can now benefit from seamless integration of SCM services on
Cloud with customers IT ecosystem and a smooth functioning of the overall solution.
5. Subscription Catalog
• Catalog with SCM functionalities for a user to choose from.
This provides greater and direct visibility to enterprises on communications, solutions and services
offered by SCM on cloud. This would make it very easy to look and identify different areas to begin to
quantify the benefits of different solution components which will best serve an enterprise.

7. Conclusion
The importance of on-demand hosted supply chain software delivery model designed and delivered on a
Software as a Service (SaaS) is due to its long-term significance
The potential of this technology lies in overcoming the monolithic nature of traditional ERP systems in operation
and scale, cloud-based models provides a prospective customer the ability to capture and deliver orders through
a globally visible network to ship the product direct to the consumer or retailer.
The timing of this technology is Now, as analysts iterate that emerging supply chain systems are evaluated basis
its adaptability to innovative platforms vis-à-vis cost effectiveness. Announcement of cloud computing with
particular emphasis on global supply chain as an enabler to bottom the cost-of ownership model would compel
any smart organization to leapfrog in their industry using the economic benefits derived from shifting to Cloud
as their IT model.