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Should You Move Your Logistics Business to the Cloud?

The majority of modern day logistics businesses use some technology to run their operation – with most still having on-premises implementations. However many are now migrating to the cloud as they recognise the wide range of benefits available to them.


The Many Advantages

  • In an industry where profit margins can be quite tight, cost savings are often the number one advantage for logistics businesses to move to the cloud. It is only necessary to pay for what is used, and scaling up and down can be done immediately. Charges are completely transparent which makes planning easy.
  • Small and mid-sized businesses have the potential to operate on the same playing field as large global companies as they can access technology platforms through the cloud that they would otherwise find unaffordable.
  • It is convenient since a logistics business only needs a terminal and an internet connection as opposed to traditional approaches which required a company to own or lease hardware and have somewhere to store it, or rent space in a colocation datacentre.
  • The requirement to hire IT staff is minimised as there is very minimal hardware and software is updated by the proprietary vendor – this includes all patching and updates.
  • All data backups can be made directly in the cloud as opposed to having to worry about backup storage and tapes etc.
  • The cloud host provider has responsibility for ensuring service is not disrupted, and they are usually experts at running appropriate backups as when they do have a failure it is typically very expensive as there are penalty clauses attached to contractually agreed SLAs.
  • By utilising the cloud provider’s global network, logistics businesses can usually operate more efficiently with the businesses they work with.


What’s the hesitation?

It is easy to appreciate the many advantages of moving to the cloud, so why have some logistics providers been hesitant? The primary reason cited is concern about losing control over the safety and security of their data. However the reality is that in most cases cloud providers are extremely secure as they have teams of security personnel dedicated to securing the cloud and analysing any attempted breaches.


The advice

If you are a logistics business considering a move to the cloud, first undertake a strategic analysis to determine what can and cannot be moved to the cloud. Some applications and data will not be suitable for the cloud. Ensure you undertake a thorough evaluation of a prospective cloud service provider and pay close attention to their approach to security and regulatory compliance. It might be useful to ask for references and to also ask to see reports on any potential security breaches. Furthermore, take a look at the cloud provider’s fee structure and any recourse you might have in the event that contractual SLAs are not met.

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