Cloud Based Supply Chain Networks—Principles and Practices

Abstract

Cloud computing services are growing and developing at a rapid pace. The growth of cloud services is taking place in various forms that are suitable for various applications. Cloud computing as a computing service caters to the needs of various applications by providing a distributed environment for computing services. The services are useful in managing various engineering and management processes in the supply chain network (SCN). A supply chain network is encapsulated with challenges related to capital costs, operational costs, timely availability of information, management information system and overhead costs. Cloud computing services offer services that helps in minimizing the problems related to the challenges faced and thereby increases the productivity of the supply chain network. The supply chain firms can benefit from cloud services by way of reduced capital expenditure and reduced operational costs. Supply chain firms can be decentralized units which can utilize fog computing in which data and applications are distributed logically between data points and cloud. Also, emerging concepts of mist computing can be helpful wherein the system architecture pushes the processes nearer to the data source in a supply chain network. The expenditure mainly is because of the operational cost which can be minimized by suitable deployment of cloud computing service. The cloud services are available today as metered services thereby the operational cost can be reduced by regulating the usage. Cloud computing services from Microsoft, Google, and Amazon are already available at reasonable rates and many services providers are entering the market to pose more competition which is healthy for users from reduced pricing. It can be expected that with the developments in cloud services, the service charges will decrease which will be a great advantage to the supply chain network firms and other related firms. A supply chain network enabled with cloud computing services is referred to as the Cloud Supply Chain Network (CSCN). In this paper, the benefits and opportunities of cloud supply chain network along with the challenges faced by the firms are discussed. Firms while planning to adopt cloud services to enhance their supply chain network processes look for budgeting plans which can be determined using functions as discussed in this paper. The perspectives, principles and practices in cloud supply chain network are detailed. It also describes how one can consider the parameters of the characteristics of cloud computing in supply chain network for the purpose of modeling and analyzing the information flow. A framework of the design factors of cloud supply chain is explained which will enable the decision maker to derive the necessary results by suitably incorporating the factors in the analysis of cloud supply chain network.