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Supply Chain Industry Updates

Survey: If You’re Not in the Cloud, Expect to be Down in the Dumps

iStock/Vadym Pastukh

The ability to work from home has saved many businesses from ruin and kept millions of people employed during the pandemic. But it’s also created severe challenges for some industries.

Hotels and passenger airlines come to mind because their work demands the physical presence of both employees and customers. But the logistics industry has been bruised, too. In fact, more than half of logistics professionals said that working from home was the No. 1 supply chain disruption impacting their businesses in 2020, followed by manufacturing slowdowns (45%) and restrictions in international trade (33%). They were responding to a survey conducted by Cleo in partnership with Dimensional Research.

If that comes as a surprise, keep in mind that many of these companies — unlike those in other industries — have not been able to simply transition almost the entirety of their daily operations to remote work with the help of Google Apps, Zoom and other tools. Not to point fingers, but they may have only themselves to blame.

“The problem for logistics companies is that they have historically been slow to adopt cloud platforms,” a Cleo spokesperson told Supply Chain Best Practices. “So, they have struggled to gain access to their legacy systems due to their on-premises infrastructure when their employees are forced to work remotely, which results in work delays and a drop in productivity for the logistics company’s workforce.”

This is a costly problem for many organizations. More than one-third of logistics companies told Cleo they were losing more than $250,000 annually due to poor data integration. “Nine percent say they are losing $1 million or more because of integration technology problems,” the software company reported. “Over half have increased their technology budgets to address supply chain shortcomings surfaced by COVID-19. What problems are the biggest? According to the study, 34% say they rely too much on manual integration processes, and also suffer from slow decision-making.”

The survey of 200 logistics industry experts was conducted in November. More information can be found here.