That element of sharing is what distinguishes the cloud from more traditional means of centralizing data. All relevant data is held in one place, notes Johnsen. "Then the community of partners you [are working with] links to that information. It puts everybody on the same page."

The cloud isn't about to replace the substantial investments in supply-chain information technology that companies have made over the past few years, Johnsen says. Applications that are essentially "interior" in nature, such as enterprise resource planning, warehouse management systems and transportation planning, can continue to operate as before. "But when it comes to inter-company collaboration, beyond the four walls, this is where the cloud can play a critical role," he says. "These platforms are architecturally different. They're designed for multi-enterprise collaboration."

The word "cloud" comprises a number of related elements, including hosted applications and software as a service (SaaS). But it also plays a key role in such areas as business-to-business infrastructure, file transfer and even hardware.

The benefits for supply chains, says Johnsen, included greater process efficiency and lower operational costs. A company looking to rearrange its network or alter a sourcing strategy can do so in a relatively quick and painless manner.

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Keywords: EDI Communication (XML/EDI), Technology, Business Intelligence & Analytics, Business Process Management, Collaboration & Integration, Customer Relationship Mgmt., Event Management, Order Fulfillment & P.O. Mgmt., RFID, Wireless, Bar Code & Voice, Sales & Operations Planning, Supplier Relationship Management, SC Planning & Optimization, Supply Chain Visibility, Cloud, SaaS & On-Demand Systems, Business Strategy Alignment, GT Nexus, Multi-Enterprise Collaboration