At its core, cloud computing is about changing the way that we do business. Computing over the internet has allowed organisations access to their essential business tools at any time from anywhere with an internet connection. By implementing online inventory management, managers and business owners are able to monitor stock levels in Bristol while on holiday in Brussels.
Cloud has become the new normal, particularly in Europe; 2016 estimates suggest that almost 70% of UK and Irish businesses use at least one cloud service on a regular basis. For businesses, the benefits of the cloud are clear – reliability, ease of access, lower service costs and innovative products.
That said, the cloud is a relatively new innovation and the market for cloud services is still transforming rapidly. Industry leaders agree that the cloud market is entering a ‘second wave’, with cloud services expected to undergo a further round of disruptive transformation. Here are several trends to be prepared for.
Private Cloud is on the Way Out
Private cloud services describes cloud computing that is implemented on a corporate intranet or behind a corporate firewall. A private cloud is intended to offer the same functionality as systems hosted in the cloud at large, while mitigating concerns about data ownership and control, security and regulatory compliance. Private cloud services offer a good compromise between cloud functionality and traditional market or regulatory requirements. But as understanding and expectations of cloud providers evolve, consumers and regulators are increasingly comfortable with hybrid or public cloud infrastructure.
Private cloud is likely to have a place going forward, but only in the most security sensitive applications such as government or corporate wealth. Although functions such as inventory management are still sensitive, cloud providers are capable of delivering a high security standard (which, for many customers, is likely to exceed the protection provided by traditional firewalls and antivirus software). Online inventory management products will be almost exclusively delivered on public clouds.
Flexibility as a Driver of Cloud Adoption
Many cloud providers cite cost savings as a key reason to migrate to the cloud; cloud services are often cheaper and can create useful tax savings, such as being able to treat software expenses as operating rather than capital expenditure. However, as the cloud market matures, cloud operators are now placing more of an emphasis on flexibility and business agility than on aggressively reducing prices. For example, online inventory management solutions are already significantly cheaper than enterprise licensed inventory software was several years ago. In practice, businesses should expect slightly less price competition between cloud solutions as providers seek to compete on agility and function.
Increasing Difficulty with Traditional Software
Most businesses still rely on traditional on-premises software, including downloaded inventory software. As the market for cloud software expands, traditional software vendors are likely to struggle to keep up. Some developers are likely to go out of business, while many others will refocus on the cloud. If your business still relies on traditional software, consider a plan to migrate to cloud solutions, particularly if that software is in a vulnerable industry such as accounting, customer relationship management or inventory management software.
IoT Solutions Will Expand
For many years, the ‘internet of things’ has largely been limited to hypothetical and test solutions. IoT solutions are increasingly finding their way into everyday business and offer opportunities to increase efficiency and reduce waste. In inventory management, for example, the increasing adoption of RFID tags creates opportunities for physical inventory to synchronise with the cloud, effectively managing itself.
Cloud applications are increasingly differentiating themselves based on their ability to integrate various aspects of your business’ workflow. An online inventory management offering, for example, may integrate with your point of sale, ecommerce, shipping and accounting products, all of which may be in the cloud.
Article by Melanie Chan in collaboration with our team of Unleashed Software inventory and business specialists. Melanie has been writing about inventory management for the past three years. When not writing about inventory management, you can find her eating her way through Auckland.