Remote computing increasingly being used to access applications, integrate supply chainsBy Peter A. Buxbaum, AJOTAs companies become increasingly global, companies are challenged to adopt capabilities to support visibility across their supply chains. But a recent report from the Aberdeen Group, an information technology analyst organization, shows a lag in the number of companies that have adopted technologies that address cross-enterprise visibility. “One way to accomplish visibility within a multi-enterprise logistics network,” according to the Aberdeen Report, “is to leverage” cloud based technologies. Cloud computing, like the related concept of software as a service (SaaS), posits that users can access information technology infrastructure, such as databases, and run software, including logistics applications, from someone else’s shared infrastructure. Several logistics technology providers offer solutions on cloud-based platforms. Organizations accessing applications from a remote, shared infrastructure enjoy some obvious advantages. They don’t have to invest in their own hardware to run the application nor devote IT resources to hiring personnel to manage it. The overall costs of such an arrangement are lower than in a traditional software implementation. The software is updated automatically and remotely by the service provider. “New innovations come much more rapidly,” added Rick Collison, director and solution owner at Ariba Services, a Sunnyvale, Cal.-based provider of a cloud-based automated trade management solutions. “Upgrades are free and are included in the subscription price.” There are also some problems associated with using a shared, remote infrastructure. The ability to customize software, for example, is gone. Cloud and SaaS information technology vendors are attracting growing revenues, according to recently released analyst reports. This held true even during the recent recession during which spending in other IT sectors plummeted. This demonstrates that the concepts have begun to catch on and that IT buyers are attracted by SaaS’s value proposition. But vendors must pursue a different kind of business model of they are to continue to succeed. There are a number of potential advantages to deploying logistics applications over the cloud, according to Bob Heaney, an Aberdeen Group analyst. Besides the lower cost of ownership, cloud computing foster collaboration and information sharing across supply chains. “The roll out of trading communities requires a service based approach given the need for recruitment of hundreds of trading partners or suppliers and integration with multiple disparate data sources,” he said. “The logical extension is the running of the trading community itself is outsourced to a third-party provider.” Cloud-based logistics technology providers generally offer comprehensive trading platforms for use by customers and their supply-chain constituents, together with a range of applications which can be accessed as needed. GT Nexus, an Oakland, Cal.-based company, offers a cloud supply chain platform on which companies manage their physical and financial supply chains with solutions such as supply chain visibility, trade finance, business intelligence, freight contracting, and supplier enablement. The Global Trade Management platform from Management Dynamics, a company headquartered in East Rutherford, N.J., is comprised of supply chain networking services to connect trading partners; applications to manage suppliers, transportation, and trade compliance; a supply chain visibility and performance management solution; and and a data warehouse and analytical tools. Descartes Systems Group, an Ottawa-based logistics technology provider, has built its business around creating a Resources in Motion Management System that enables the movement of goods, together with the assets, people, and documents associated with them. At the heart of this approach is the cloud-based Descartes Federated Global Logistics Network which brings