When you think of cloud-based supply chain management, it’s easy to think of a modern warehouse with paperless invoicing and infinite storage, right? And, yes; it’s an exciting goal to strive for but unfortunately the cloud has not yet been fully exploited.
Businesses have so far been cautious of taking the full dive into cloud technology, and many pundits are saying that hybird cloud solutions are the way ahead (and beginners guide) for cloud solutions. This post weighs up and challenges and benefits of hybrid cloud to see if it’s a good solution for your supply chain.
What is hybrid cloud?
Hybrid cloud is a computing setup that enables on-premises, private cloud and third-party, public cloud services to be used in orchestration between two platforms. Well at least this seems to be the main definition circulating tech publications anyway (see here and here).The below image provides a good visualisation of how hybrid cloud works:
It’s been so desirable to businesses in place of complete migration to the cloud because it allows them to store protected and sensitive information that they do not want publically accessible on a private cloud. In easier to understand, non-tech-layman terms; hybrid cloud provides the opportunity to manage the platform for both private and hybrid deployments.
In principle, hybrid cloud solutions sound like a great alternative to uploading all your businesses data to a public cloud and letting tech take over your operations. But in reality, hybrid solutions don't come without their challenges.
Challenges of cloud technology
There are a number of uncertainties and challenges that the use of cloud computing services brings.
As with most digital technologies in business today, cloud solutions – in some cases – may mean that business owners need to choose between security and the overall efficiency of their supply chain. The reason for this is that cloud servers are connected via an electronic data interchange (EDI) to any other number of institutions or portals. Staff could access information held within the cloud-based server from anywhere in the world but that also opens a lot of sensitive data up for intrusions if information falls into the wrong hands.
Interoperability and portability
If the main benefit of cloud-based solutions is flexibility – as you’ll see further down the post – then you would imagine it should be easy to migrate in and out of different cloud solutions whenever you want. Unfortunately, it can be a cumbersome process to migrate into different solutions as some cloud service providers have strict lock-in periods, and if not, if integration is challenging it may not be something you want to do very often.
Though cloud-based solutions may save you costs on infrastructure and hardware, you may find your bandwidth costs increase. For smaller businesses this may not be an issue, but to large companies with complex supply chains, delivering intensive and complex data over the network requires significant bandwidth.
There are a few other challenges including implementation, choosing the right provider, support and maintaining control, but as technology improves, eventually these challenges will be addressed. But in the interim, many businesses are avoiding cloud-based solutions because of the risks they face if something were to go wrong. Let's take a look at some of the ways hybrid solutions are currently attempting to mitigate these risks.
Hybrid cloud as the next best alternative
Although the challenges above have been enough lately to stop business from migrating to the cloud, there are some attractive benefits worth considering. Let’s take a look at how hybrid cloud is currently transforming supply chains.
Hybrid solutions allow a great deal of flexibility for businesses concerned about security but are still looking to dip their toe in new digital tech. The beauty of hybrid is in readopting some aspects of these old technologies by adding a private cloud to the public service, but leaving behind the biggest problems — space, servers, power for cooling etc.
Cloud technology has really developed in the last few years, and although service providers may have once been seen as being incredibly inflexible, there are now a range of options available for business looking to adapt hybrid solutions.
It’s no surprise then that hybrid models are scalable. Investment in private IT infrastructure, can be costly, and if not chosen wisely, can become obsolete in a short time. A hybrid solution mitigates this risk, because you can extend your IT capabilities without heavy infrastructure investment. Not only does this ensure that the systems can meet the current IT needs of the organisation, but it is also future-proof.
Another important benefit of a hybrid cloud model, is that it promotes business continuity. Despite popular belief, business continuity doesn’t just involve backing up or replicating data on the cloud. Business continuity is actually about having a plan B in place, so that if the worst occurs, business can go on as usual. Hybrid cloud solutions promote business continuity by providing ‘disaster insurance.’ Pertinent data can be moved or replicated into a public system so that if disaster strikes, nothing is lost, and downtime costs are kept to a minimum.
Is a hybrid solution right for you?
Although hybrid solutions are an appealing option for an increasing number of businesses, creating this model isn’t straightforward. A hybrid model is a bespoke solution for your company and internal staff members may not have the level of expertise needed to successfully implement the model.
Another key challenge is that your existing legacy technology may not be compatible with cloud solutions so integration would take a significant amount of time, money and resources. In some instances, with a system that has both public and private capabilities, it may result in your team needing to run two different stacks.
However, if you can meet these challenges successfully, you would end up with a secure, flexible system that will grow with your company.