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Supply Chain PaperSurvey conducted by IDG Connect on behalf of Oracle5Significant advantages of cloud-based supply chain managementCloud-basedSCMadvantagesWith plans by respondents in mostregions to deploy SCM processes inthe cloud, they were then asked aboutwhich advantages they expected fromdoing so. Respondents saw severaladvantages of cloud-based SCM,with all listed advantages receivingsignificant responses (over 43%; 95%selected three or more advantages).The biggest advantages were fasterimplementations, cost savings, andimproved customer service (61%, 60%and 59% respectively).From a regional point of view,respondents in Central and SouthAmerica saw the ability to leverage newtechnologies (e.g. Internet of Things,Industry 4.0) receive the second highestlevel of responses (68%), and in AsiaPacific, faster implementations wasclearly the most popular advantage(90%).There were few major differences inresults by organisational size, except forthe following. In organisations of 500 to999 employees, more agility in supplychain operations was the most popularadvantage (60%); in organisations of1,000 to 4,999 employees, the ability toleverage new technologies (e.g. Internetof Things, Industry 4.0) received thehighest number of responses (61%);in organisations of 5,000 to 24,999employees, faster implementations isclearly the most popular advantage(87%); and in organisations of 25,000 ormore employees, cost savings followedby improved customer service receivedhigh levels of response (78% and 68%respectively).These regional variations are broadlyin line with what might be expected oforganisations of that size.Asked about the single most significantadvantage, there was no single mostpopular option, as several optionsreceived very similar levels of support:improved customer service, costsavings, faster implementations andgreater security (23%, 22%, 21% and20% respectively). Greater security isgenerally high in the list of advantagesacross all breakdowns of the data,especially so for larger companies (26%and 24% respectively for companies with5,000 to 24,999 employees and 25,000or more).AdvantagesMost significantFaster implementations61%21%Cost savings60%22%59%23%Improved customer serviceAbility to leverage new technologies (e.g. Internet of Things, Industry 4.0)18%54%Greater securityBy region, however, EMEA respondentsselected cost savings as the top option(24%), while in North America, improvedcustomer service was the top option(24%) - both options pointing to highlevels of competition. In Central andSouth America, 39% selected improvedcustomer service, making this optiona very clear winner, 13 percentagepoints clear of the tied, second-placedoptions of cost savings and greatersecurity (26% each). And in Asia-Pacific,the highest percentage of respondentsselected faster implementations as themost popular advantage (40%), also 13percentage points clear of the secondplaced options: cost savings and moreagility in supply chain operations (27%each).Looking at the responses from an SCMscope perspective, improved customerservice is the biggest advantage from adomestic-only point of view (25%), whilecost savings is the biggest advantageregionally (31%), and greater securitywins globally (25%).53%20%For those respondents within IT departments, the ability to leverage newtechnologies (e.g. Internet of Things, Industry 4.0) also received significantresponses (22%), most probably because those in IT departments are morelikely to be aware of new and upcoming technology developments and thechallenge of integrating these technologies with legacy applications that weredesigned around the supply chains of 10 to 20 years ago.

Survey conducted by IDG Connect on behalf of OracleCloud-basedSCMdisadvantagesInterestingly, when asked aboutdisadvantages to the use ofcloud-based SCM technologies,respondents perceived securityas the highest by far (53%). Thisseems to contradict the resultsfrom section 5 (Cloud-BasedSCM Advantages), where 53%selected greater security as anadvantage of cloud-based SCMsolutions. The logical conclusionto draw is that the communityof respondents is split, withabout half perceiving the cloudoffers more security, the otherhalf perceiving it offering lesssecurity. It would also seemsafe to assume that, driven bya number of highly publicisedsecurity events, poor perceptionsof cloud security have resultedin pre-judgement of the level ofsecurity offered by cloud-basedSCM solutions.The remainder of the perceiveddisadvantages all receive a verysimilar level of support, with63% selecting two or moredisadvantages.Looking at the regionalresponses, a number ofvariations emerge. Securityremains a top concern in twoof the four regions, but in Asia-6Pacific it is near-equal top (withinthe margin for error) with datacurrency/accuracy (57% security,60% data currency/accuracy).In Central and South America,a similar pattern emerges withsecurity at 48% and availabilityat 45%. These results clearlyindicate issues that are particularto these regions, and suggestwider problems outside thescope of SCM processes.Other than security, however,most respondents selected fewof the disadvantages, with thesecond-placed disadvantageattracting a response level ofonly 29%.Possible disadvantages of using cloud technologies for supply chain applications53%Security29%Less Supply Chain PaperMotivatorsFOR CLOUDadoptionIt can be seen from theresponses to this question thatthe motivations to adopt cloudbased SCM are many but thatthere is no single significantdriver. All listed motivatorsreceived significant (andalmost equivalent) responses(over 17%) with confidence insecurity and operational costsavings receiving marginallyhigher responses (22% and21% respectively).With aggregated resultsfairly consistent across mostrespondent categories, onekey highlight can be foundby looking in more detailat SCM scope. So from aregional SCM point of view, ITresource savings received thehighest response (24%), aboveconfidence in security (18%).This validates the resultsfrom previous questions,where we can see thatsecurity remains top ofmind, and that the move toa cloud-based SCM solutionwill be driven by a variety ofmotivators, most of whichreceive similar levels ofsupport across respondentcategories.Motivating factors for adopting cloud-based supply chain applications22%21%20%19%17%Confidencein securityOperationalcost savingsIT resourcesavingsCorporateIT strategyCompetitivepressureDataaccess

Supply Chain PaperSurvey conducted by IDG Connect on behalf of Oracle8Challenges to adopting cloud-based supply chain applicationsConcerns regardingcloud security49%Biggest challengeAvoiding businessdisruptionConcerns over ITdisruptionMost significantLack of sufficientexpertiseShortage of internalskills/ expertise42%42%38%36%8%10%7%7%21%ADOPTION CHALLENGESChallenges exist in all stages of all businessprocesses, and SCM is no different. Respondentssaw several challenges in adopting cloudbased SCM processes (84% selected threeor more challenges), with concerns regardingcloud security being the biggest challenge(49%), followed fairly closely by concerns overIT disruption and avoiding business disruption(42% each).The aggregated results were fairly consistentacross most respondent categories. Keyvariations by region were in North America,where avoiding business disruption (51%) wasa bigger challenge than concerns regardingcloud security (44%). This demonstrates that NAbusinesses are more likely to be comfortablewith cloud-based applications and services, asexperience smoothes away perceived issuesaround cloud security.In EMEA concerns regarding security arehowever the top challenge by some margin(52%) over the next two biggest challenges –concerns over both business and IT disruption(37% each). This is likely, in part at least, to be anartifact of the strong issues in this region aroundgeographically sensitive data and legislativecompliance. In the Asia-Pacific region, concernsregarding security and lack of sufficientexpertise shared the top spot at 57% each,showing that cloud security perceptions remainan issue along with poor IT skills; the two may infact be related, as strong IT skills can go someway towards mitigating security issues.In Central and South America, concerns overIT disruption (48%) and shortage of externalskills/expertise (48%) were the biggestchallenges when adopting SCM processes inthe cloud, followed closely by security (45%)and lack of suitable cloud applications (45%).This also suggests a linkage between theresponses: if skill-sets are lacking, everythingbecomes more of a challenge.When analysing the data by companysize, concerns regarding security remainparamount for all company sizes, butconcerns over IT disruption grow withcompany size: from 33% for organisationswith 250 to 499 employees, to 51% for thosewith more than 25,000 employees. Forcompanies in the next size bracket down,concerns over security and IT disruption areboth at 50%. This demonstrates the growingcriticality of IT continuity and its importanceto the supply chain, as companies grow largerand increasingly deploy SCM processes.When asked about the most significantsingle challenge, the picture is similar towhen multiple responses were requested:security concerns are by far the mostsignificant challenge to adopting supplychain processes in the cloud (21%), withbusiness disruption a distant second(10%).Across the regions, the picture is similar,except in Asia-Pacific, where a lack ofsuitable cloud applications attracts thesecond biggest response (17%). In Centraland South America, security concerns(16%) were followed closely by shortageof external skills/expertise (13%).

9Supply Chain PaperSurvey conducted by IDG Connect on behalf of OracleDigging deeper into the motivations for the adoption of SCMin the cloud, respondents were asked what capabilities wouldprovide the greatest incentive to move to cloud-based SCM.Respondents saw several capabilities as major incentives(95% selected three or more capabilities). The most popularwere visibility, metering and monitoring; integration with nextgeneration technologies; and resource usage and optimisation(56%, 55% and 52% respectively), followed by capacitymanagement and planning, and ability to manage outsourcedactivities also (50% each).Greater visibility and monitoring granularity have been highon IT departments’ wish-lists for a considerable time, so thereis perhaps little surprise that this item reached the top of thelist. However, it was followed very closely behind by a desirefor integration with next-generation technologies, so it is clearthat businesses are seeing the need to move to the next levelof visibility in their customers’ activities, as well as wanting toincrease and enhance communication channels with customersand partners within the supply chain.NewcapabilitiesIntegration with next-generation technologies as an incentive was especially strong for medium-sizedcompanies – those with between 1,000 and 4,999 employees – 70% of whose respondents selected thisoption. The desire for greater visibility increased with size of company: it reached only 38% for companiesbetween 250 to 499 employees, but 74% of respondents in organisations of 5,000 to 24,999 employeesand 62% of those in organisations of over 25,000 employees. Respondents from the largest companies alsoselected equal top (62%) the ability to manage outsourced activities (e.g. manufacturing, transportation).We focused in on the single most important incentive to move to cloud-based SCM, and the responseswere illuminating. Analysing the responses on a regional basis finds the incentives provided by nextgeneration technology capabilities equal top in North America at 26% alongside ongoing operationsmanagement (27%), visibility, metering and monitoring (26%) and ability to manage outsourced activities(25%). (Note that these small percentage differences are well within the margin for error and can bepresumed to be equal.)In EMEA, the picture is somewhat different, with integration with next-generation technologies sharingthe top spot with capacity management and planning (28% each), while in both Central & South Americaand Asia-Pacific regions, next-generation technology integration is less important (23% and 27%respectively) compared to collaboration on product design and innovation (32% and 37% respectively). Thisdemonstrates clear cultural differences in the way that business is conducted between the various regions.Incentives for moving to a cloud-based SCMAbility to manage outsourced activities(e.g. manufacturing, transportation)50%24%Capacity managementand planning50%23%Resource usage andoptimisation52%22%New capabilitiesMost importantVisibility, metering andmonitoring56%24%Integration withnext-generationtechnologies(e.g. Internet of things,social, mobile)55%27%

Supply Chain PaperSurvey conducted by IDG Connect on behalf of OracleLooking at the most difficult areas byfunction, respondents said that almostall areas presented challenges. Thehighest percentage of respondents sawmanufacturing, logistics, and supplyplanning as the most difficult areas (33%,33% and 32% respectively).The 5 most challenging areas to move to the cloudThe aggregated results were fairlyconsistent across many respondentcategories, with key highlights/variationsbeing Central and South America, wherelogistics, supply planning, and innovationmanagement received significantly moreresponses than other options (42%,45%, and 39% respectively).10In Asia-Pacific, half the respondentsfound manufacturing to be the mostdifficult area (50%). This result could beaccounted for by the preponderanceof globalised manufacturing industriesin this region, especially electronicsindustries whose supply chains are likelyto be long and involve rare materials. Itmight also be influenced by the difficultyof automating manufacturing in an areawhere labour costs tend to be low, whichdisadvantages automation from a costeffectiveness tics32%Supply planning28%Product design27%Inventory/ warehousemanagementEMEA respondents also reporteddifficulties with moving manufacturing tothe cloud (38%) but not to such a highdegree, followed by logistics (31%), whilein North America, logistics and supplyplanning were the key areas (36% and35% respectively).Overall, the different regional responsesare likely to be accounted for by thevarious geographical, cultural andinfrastructure variances in theseregions, such as the availability of skilledworkforces, high-speed connectivity,and preponderance of industrial sectorswithin each region.Looked at by company size, the picturechanges. Organisations of 250 to 499employees say overwhelmingly thatlogistics is the most difficult area tomove to the cloud (47%) while very largeorganisations of 25,000 employees ormore cite supply planning and inventory/warehouse management (46% and 38%respectively). These results reflect thedifferent sizes and scopes of their SCMoperations. The responses also validatethe replies from section 3 (StrategicAdvantages), where the biggest strategicadvantage from SCM found by thesmallest organisations is operationalefficiencies (such as logistics) while thelargest organisations cite customercentricity, which means streamlininginternal processes (such as warehousingand supply planning) to allow greaterfocus on the customer.

Supply Chain PaperSurvey conducted by IDG Connect on behalf of Oracle11Do you feel vendors need to provide better justificationfor adopting supply chain cloud solutions?80%Yes20%Nojustificationrequired?Vendor support is crucial to a successful move into cloud-based SCM solutions, involving as it doesa range of issues as we have seen from earlier sections. So it is clear that a significant majority ofrespondents feel vendors need to improve efforts in providing justification for the adoption of supplychain cloud solutions (80%). There is very little variation when analysing the results by region, companysize and scope, except in Asia-Pacific where 100% of respondents feel vendors need to provide betterjustification to adopt supply chain cloud solutions.JustificationareasMoving to the discussion of how vendors can help tojustify adoption of cloud-based, end-to-end supplychain management, all justification areas receivedsignificant responses. Respondents saw severalways as 95% selected two or more ways, and 87%selected two to four ways. Security and certificationfollowed by clear explanation of integration in thecloud received the highest responses (59% and 48%respectively).Regional results varied little from the aggregate,although in Asia-Pacific, 67% selected security andcertification, with the second highest justificationselected as bundled software and implementationpackage (57%).12Methods for vendors to justify adoption of cloud-based, end-to-end supply chain management59%48%40%40%40%Clearexplanation ofintegration inthe cloudBundledsoftware andimplementationpackageTrials/ proof ofconceptCustomerreferencesWhen analysed by reporting area, a small variance is evident, with only 76% of respondents frombusiness functions other than IT feeling that vendors need to provide better justification to adopt supplychain cloud solutions. In contrast, those within IT agree very slightly more than the aggregate (81%), sothis strongly suggests that IT reports are closer to the action and so will perceive more directly the benefitof vendor support.Security andcertification

Supply Chain PaperSurvey conducted by IDG Connect on behalf of Oracle13The best solution from many end-users’perspectives is for vendors to deliveran end-to-end, integrated SCM systemthat offers a range of functions andbenefits. This clear conclusion is drawnfrom the fact that all listed advantagesreceived significant responses (94%selected two or more advantages;84% selected two to four advantages).Process optimisation, followed by realcosts to serve received the highestresponse (53% and 51% respectively),and opportunistic scalability received thenext highest response (48%).Regionally, Central and South Americaselected process optimisation insignificantly higher numbers thanthe aggregate (65%). In Asia-Pacific,the proportion selecting processoptimisation was bigger still at 70%,although in this region, the top optionwas opportunistic scalability (77%), withthe third spot occupied by single view ofsupply chain status (63%) – a significantlyhigher proportion than any other region.End-to-endSCMadvantagesLooked at by company size, the largerthe company, the higher the proportionopting for process optimisation asthe top advantage of a cloud-based,end-to-end SCM solution: 47% ofrespondents from the smallestcompanies selected this option,while 65% of those from the largestcompanies s

Top three strategic advantages of supply chain management (SCM) All respondents clearly see a range of advantages to SCM, though there is some variability in the . scope of respondents' SCM processes, improved customer service is the biggest advantage from a domestic-only point of view (25%), cost savings is the biggest