Expert Insight: Guest Contribution

By Greg Johnsen ,
EVP Marketing & Co-Founder,

GT Nexus

Date: October 14, 2010

Supply Chain Comment: Control Towers for Everyone? Yes – in the Cloud.

There's No Longer Any Need To Dream Of Real-Time Monitoring And Visibility Of Orders, Shipments, Inventory And Landed Cost:  It's A Reality�

One day we’ll all look back and wonder how we ever managed without “on demand” supply chain control towers, and their ability to give us instant and accurate monitoring of trade and logistics flows across our global supply chains.  We’re in a technology inflection point right now, maybe the biggest of our lifetimes.  It’s called Cloud.  I’ve written about Cloud and what we now call “Cloud Supply Chain” in these pages before, so regular readers will please excuse me for going back over some old ground. Today, software applications and data networks and business-to-business infrastructure are all being delivered “in the cloud”.  Instead of installing and managing complex IT yourself, within your own company, you “rent” it over the Internet.  This model is not a fringe idea.  It isn’t risky.  It’s proven.  It works.  And the economics are truly breakthrough.  Now even the smallest companies can subscribe to cloud technology platform services that enable advanced global supply chain control towers capabilities at a fraction of the cost of traditional IT deployments.  There’s no longer any need to dream of real-time monitoring and visibility of orders, shipments, inventory and landed cost. It’s a reality.  The new technology gives you a clear view from order point to final delivery, from and to any point on the globe.  Control towers are not just for ultra-fortified Fortune 100 companies.  They’re for everyone.

But misconceptions still exist about what is required technologically to get in the game.  Can a corporate IT team build its own control tower?  Can they buy “off the shelf” business software and go from there?  How different is the technology behind these control towers?  And what is the best way to pull all the pieces together quickly, cost-effectively, with minimal fuss and risk?

One big misconception is that a control tower is just another software application.  Control towers are only one part software application, and five parts data network.  The application – the data crunching part - is just the tip of the iceberg.  It’s the data network below the water line that makes or breaks your control tower. IT managers who have deployed “inside the four walls” business applications for customer service, or factory planning, or any number of ERP-related solutions must accept the fact that this is something they haven’t done before.  One big difference is this IT extends beyond the four walls of the enterprise.  Control tower systems connect trading partners and service providers to create a vibrant, “always on” electronic community.  The data network spans the globe and must be capable of integrating with the proprietary systems of hundreds of partners – to send purchase orders, to pick up ASNs and manifests and invoices and packing lists, and issue shipping instructions and listen for confirmations.  This is a long list of “conversations” – and they must all be tapped and translated and understood in order to make the tip-of-the-iceberg application work. 

It’s not just that global partner data networks require a different set of skills and expertise than traditional business software design; it’s that even if you did develop your own systems, you would never be able to get the data quality levels that a commercial platform delivers.  This is because leading commercial platforms leverage the power of a broader community to improve data quality from trading partners and service providers.  Like the global community of writers and editors that power Wikipedia today to create the world’s largest – and by many estimates the most accurate – encyclopedia, the user community around these commercial platforms is continuously improving the connections, and the data flowing through those connections.  Data quality goes up even if you aren’t improving it yourself.  It’s this model, this reliance on a larger partner community working collaboratively on a shared global technology stack that makes it so much more feasible, cost effective, and commercially attractive.  You could never, on your own, build and maintain a better encyclopedia than Wikipedia.  It’s time for IT Managers and CIOs to note the significant role that a data network plays in delivering advanced supply chain control towers.

Data quality is the lifeblood of control tower systems.  The radar can look beautiful, it can be the finest of instruments, but if the data behind it is bad you’re going to be in real trouble.  The data must be good – very good.  The best control towers have a strategy for getting it right.  And they are available today at a fraction of the cost of traditional IT deployments – thanks to Cloud.

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About the Author

Greg Johnsen is executive vice president of marketing, and co-founder of GT Nexus. Mr. Johnsen has more than twenty years of sales, marketing and product management experience with Silicon Valley technology companies. He has spent the last ten years focused on supply chain and logistics, working with hundreds of leading companies to drive sustainable improvements in global sourcing, transportation management, inventory control and a range of international operations. Prior to GT Nexus he was with Scopus Technology, an early leader in the customer relationship management software domain. He began his career at Ingres Corporation, a pioneer in relational database technology. Mr. Johnsen has a Bachelor of Arts degree in English from the University of California at Davis.


Johnsen Says:

One big difference is this IT extends beyond the four walls of the enterprise.

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