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Using Cloud Computing To Manage Global Risk Of Doing Business

2015-09-23by Sujain Thomas

When businesses have relatively small footprints the issue of managing risk is usually far simpler and can be handled by the managerial and audit teams relatively easily. However, when businesses start operations across the globe and establish linkages with thousands of suppliers spread across the globe, it can be very difficult to minimize the risks. To overcome the limitations of internal systems, recourse is being taken to cloud computing strategies that have proven very effective.

 

Real-Time Company-Supplier Collaboration

There has been no other technology development that has had a greater impact on the reduction of risk of operating a supply chain than cloud technology. Cloud computing has made it possible for companies to stay in touch on a real time basis with thousands of their suppliers spread all across the globe round the clock. The conventional ERP-based solutions configured to manage supply chain systems internally by inter-connecting departments within the organization do not prove to be very well positioned to handle the business processes required to manage suppliers. This is largely because supplier networks can be extremely complex and have a very large geographical footprint making them susceptible to developing faults with great ease. Supplier networks that are cloud-based are in a position to yield more options and offer additional risk management capabilities for smart companies that have switched to this technology.

 

Multi-Tier Supplier Network Management

Because of the nature of the outsourcing business, a job can often get outsourced or sub-contracted a number of times. As a result, much of the quality standards that are specified by the business to its original supplier can get diluted to a great degree by the time the information percolates down to the supplier actually charged with making the goods. With the loss of the quality, the risk associated with supply chain management is increased substantially and can often have a major impact on the credibility and reputation of the enterprise. The problem gets magnified with the inability of traditional supply chain management solutions to efficiently track such multi-level operations. The adoption of cloud solutions & strategy for supply chain management has led to an increased level of transparency that makes it possible to have greater control over suppliers, irrespective of the number of tiers separating the businesses.

 

Detecting Suppliers That Are Banned

Due to the increased sensitivity to ethical practices, businesses all over the world stand to lose their reputations and market shares, if they are found to be dealing with organizations that indulge in terrorism, drug dealing, child and woman trafficking or financial fraud. The conventional way of dealing with this risk is to keep a watch on lists published by both the US government as well as governments of other nations. The watch-lists are dynamic in nature and require a lot of effort to monitor continuously. Businesses also need to deal with the number of ‘false positives” that occur due to confusion in identities. Cloud-based technology such as that offered by http://mesusolutions.com/ can automate this monitoring function to a great degree making it possible to achieve greater ERP integration.

 

Logistic Spend Control

When businesses are spread all over the globe and there is a need to access suppliers on a global scale, management of logistics can become a nightmare using conventional ERP systems. The adoption of a cloud-based computing strategy to manage logistics can lead to a great deal of savings. Managers are now able to monitor shipping rates across the globe and negotiate accordingly. They are also in a position to use a combination of logistical modes and can select certain distances to be traversed by road, rail, and ship or even air if so deemed by the circumstances. Further, depending upon the delivery commitments given to a client, the logistics requirement and its cost impact now can be planned out in advance.

 

Increased Level of Security and Safety

The prime concern of every business, when it ships goods in or out is that of timely delivery and no pilferage. The concern is even more when the goods are perishable and even slight delays can result in a heavy cost. Containers now can have sensors that can monitor the temperature of the goods and whether the container has been tampered with and send electronic alerts to the cloud-based monitoring system. Managers, equipped now with specific information delivered by cloud-based systems can take suitable action to ensure the safety and security of the goods being transported.

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Author

Sujain Thomas

Timothy Ufer works with university graduate programs as a community outreach manager, with a concentration for career development in higher education. In addition to cyber security, Tim's expertise includes business management, engineering leadership and entrepreneurship.

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