With new cloud-based service providers providing logistics execution systems, it’s becoming more affordable for smaller and mid-size companies to take advantage of the cloud.
The WMS challenges they feared—licensing fees and customization-cost-creep—are gradually being addressed as service providers enter the market with new offerings.
"Why should a customer continue to invest in their own internal infrastructure and support?” asks Scott Brown, executive vice president of global cloud and support services at IBS. "A lot of models out there are multi-tenant, where you sit and enter a single code base, but there's very little opportunity for customization as the business changes. In this model it's a dedicated application and if two years from now the user buys a company or moves to a different site, the functionality can move with them. And if for some reason they can't stay with our base code, we can customize that through services using their code.”
Steve Banker, service director for supply chain management at ARC Advisory Group, says the risks of this kind of arrangement are lower than with a traditional WMS licensing arrangement.
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