Supply Chain in the Cloud: Opportunities, Barriers, and a Generic Treatment

Supply Chain in the Cloud: Opportunities, Barriers, and a Generic Treatment

Goknur Arzu Akyuz (Atilim University, Turkey) and Mohammad Rehan (Atilim University, Turkey)
Copyright: © 2015 |Pages: 13
DOI: 10.4018/978-1-4666-8676-2.ch003
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Cloud concept is directly related with the beyond-ERP integrity and collaboration across a number of heterogeneous Supply Chain (SC) partner infrastructures. The technology enables partners to form a collaborative SC community without the burden of significant IT investment. Cloud applications offer significant opportunities from SC perspective, and the assimilation of the Cloud Technology is not complete yet in the Supply Chain domain. It also involves various barriers from implementation perspective, as well as the concerns related with vendor lock-in, security, reliability, privacy and data ownership. This chapter provides a comprehensive coverage of the opportunities and barriers as well as the generic treatment from SC perspective. It also highlights how the cloud technology represents a perfect fit with the ideas of ‘Collaborative Supply Chains', ‘Business Process Outsourcing' and ‘long-term strategic partnerships, which are the key themes characterizing the Supply Chains of today's era. This chapter reveals that the intersection of the topics ‘Cloud computing' and ‘Supply Chain' is a promising area for further research. Further studies in a multi-partner setting with respect to a variety of configurations, case studies and applications, as well as the security, reliability and data ownership issues are justified.
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In the IT domain, Cloud computing is one of the most recent paradigms, receiving more and more interest in the literature (Vaquera et al., 2009; Sterling & Stark, 2009). Increasing opportunities for improving IT efficiency and performance through centralization of resources and the maturation of technologies such as SOA (Service-Oriented Architecture), virtualization, distributed computing, grid computing, networking and web services led to the natural outcome of what has become increasingly referred to as ‘cloud computing’ (Tiwari & Jain, 2013; Oracle, 2009). Basic motivations behind the technology are: (a) the need for rapidly scalable elastic computing infrastructures, (b) the increased cost of traditional IT infrastructure, and (c) increased focus on service orientation (Yousif, 2009; IBM, 2008).

Cloud computing represents outsourcing of IT (infrastructure, service, platform and business processes), and enables on-demand access to IT resources from external providers generally on a pay-for-use basis like a utility. This paradigm provides access to a shared pool of configurable resources (networks, servers, storage, applications and services) delivered over the Internet (Buyya, Broberg & Goscinski, 2011; Sterling & Stark, 2009; Gartner, 2008a, b; Sosinsky, 2011; Raines, 2009; Schramm, Wright, Seng & Jones, 2010).

The approach is inherently compatible with the service-oriented philosophy, enabling standardized access to IT resources for totally heterogeneous, diverse and distributed infrastructures without knowledge of the underlying system details. Cloud benefits from SOA, since cloud computing is directly related with provisioning and consumption of IT capabilities as a service over the web. Markz & Lozano (2010) emphasises this idea by mentioning that ‘Cloud builds on the shoulders of SOA’. Thus, cloud logically builds on the concepts of services, organization and orchestration of which can be managed inside the cloud within a service-oriented architecture (Wang, Wang & Lee, 2009). Since the modularity, reusability, standardization of interfaces, interoperability, platform independence and scalability are the core issues, cloud approach can be considered as complementing the SOA paradigm, providing pay-for-use model for service oriented thinking (Sosinsky, 2011). This is also highlighted by Markz & Lozano, 2010, mentioning the ‘double play’ between cloud and SOA, cloud pulling new SOA initiatives through and SOA enabling cloud initiatives from business, IT and infrastructural perspectives.

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