Expert Insight: Guest Contribution

By Greg Johnsen ,
EVP Marketing & Co-Founder,

GT Nexus

Date: April 15, 2010

Supply Chain Comment: Cloud and the Collaborative Supply Chain

Is Cloud Making The Single Version of Supply Chain Truth Possible?

Cloud is getting a lot of attention lately.  Does anyone need a primer?  We’ve seen this phenomenon described in lots of ways over the years since it first emerged, but lately we seem to be coalescing around "cloud" as the term that best describes software and IT deployed and managed over the Internet, beyond the bounds of a single company's four walls.  On Demand.  Software-as-a-Service (SaaS).  Platform-as-a-service (PaaS). Infrastructure-as-a-service. IT outsourcing.   They all describe, essentially, the same thing. 


One thing is clear.  Cloud is real.  It's no phantom.  And it's gaining adoption and mindshare more rapidly than ever.  Microsoft is "all in" the cloud now.  IBM is pushing cloud harder than ever – just look at the mega marketing campaign they've been executing around cloud over the past nine months., the "anti software" poster child is not just SaaS anymore, it's cloud now.  All cloud.


Cloud is big because the economics are better – and in some cases they’re much better.  It’s big because the time to value is shorter and because massive capital outlays aren’t required and because there’s just a lot less risk in the model.  Want to shut down a project because something changed in your business?  You turn off the switch; you stop using the service and you stop paying for the service.  You don’t have to write off the cost of the power plant just because you stopped needing electricity in that part of the neighborhood. 


Now we’re starting to see the migration of enterprise software to the cloud happen in earnest – despite the resistance of existing software vendors who had the most to lose by cloud’s ascent to mainstream.  All the major software companies are launching cloud solutions somewhere in their portfolios.  Now, suddenly, everyone wants to get his horse into the race to cloud. Nearly every business software domain has a cloud alternative.  And cloud is gaining real traction because of the attractive IT economics and lower risks.


When it comes to supply chain, however, where the focus is on inter-company coordination and collaboration among hundreds of companies on a global scale, cloud becomes more than just “very good” IT economics.  It becomes the means by which entirely new information sharing models suddenly become possible. 


In the same way that social networks like Linked In or Facebook inverted the traditional models of personal contact systems by giving each person in a network just one profile page to which all friends would point (and thus allow everyone in the network to be updated immediately the moment that single page was changed), next generation collaboration platforms are designed to support trading partner networks that must operate on a daily basis around “single page” instances of common supply chain objects like purchase orders, or shipments, or SKUs, or milestone events, or commodity codes and city names.  Imagine the power of an information model that allows an object to be updated once, in one place, for everyone who cares about that object to get the full news immediately. 


In some circles they call that a Single Version of Supply Chain Truth.  A platform that makes that truth available to an entire trading community in an economic and scalable way is not a small thing.  It’s a big thing.  It’s transformative.


Remember the old adage about how the companies of the future will compete?  They’ll not compete company to company but value chain to value chain.  They’ll compete networks.  Not silos. 


Well, the future has arrived.  Cloud is here.  

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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:

It becomes the means by which entirely new information sharing models suddenly become possible.��

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