Opportunity of cloud computing for logistics - Michele Colajanni Università di Modena e Reggio Emilia

Opportunity of cloud computing
for logistics

 Michele Colajanni
 Università di Modena e Reggio Emilia
 http://weblab.ing.unimo.it/people/colajanni/
 http://cris.unimore.it

Logistics is movement and
communication

• Movement of goods
• Communication of information

Mobility is driving the most important changes (nearly one mobile
 device per capita in the planet, global mobile data traffic will increase 26-
 fold)
Internet-of-Things will drive the next revolution
(supply chains will enhance their speed and flexibility through new Internet-
  based technologies including RFID tagging, NFC protocols, mobile
  applications, and advanced analytics)

Vision

Cloud 
 Services

• Very few companies control, own or operate their entire supply chain
  internally from end-to-end 
 An independent (cloud) platform may
  represent a facilitator for Service Level Management

• Requirements
   •   Logistics as a Service: service engineering for cloud logistics
   •   Logistics as a product: cloud marketplace for logistics services
   •   Collaborative platform on a geographical scale
   •   Dynamic supply chain

Security related to cloud

• Companies have an absolute need to protect their products
 and customers. Lost data can lead to lost intellectual property,
 lost products, lost customers and lost business. So security
 and availability are prime concerns

Availability is guaranteed because redundancy and disaster
 recovery are embedded in the cloud system

  Many customers are still afraid of cloud security, but …

The present situation (1)

• We want to access to our data and services anytime, anywhere,
 anydevice
• We want our data with us and for this reason we use:
  • laptops
  • smartphones
  • tablets
  • USB pens

• 60% of company data are (also) on PC, laptop, tablet,
  smartphone, with increasing percentage of mobile devices with
  respect to PCs

The present situation (2)

• 10% of mobile devices are lost within 12 months

• 60% of pen-drives contain company data

• 66% of pen-drives is lost forever

• 43% of mobile subscribers experience phone damage, loss, or theft

• At LAX airport, 400+ lost smartphones are found each month

• A whopping 87% of those who lost phones had to manually re-enter their
  data, and 31% lost data stored nowhere else

• Each unrecovered PDA or business smartphone costs the employer at least
  $2,500

In order to access to our data and services
      anytime, anywhere, anydevice
 the laptop/smartphone/USBdrive model
              does not work

  Is the cloud model the right alternative?

Cloud paradigm

                 Portatili

                             INTERNET

Cloud benefits for logistics

• Cloud-based platforms are inherently collaborative and accessible,
 creating major benefits for companies that deal routinely with thousands of
 suppliers
   • Cloud-based collaboration allows multiple parties to jointly develop supplier
    contracts, dramatically enhancing contract management
   • Cloud computing offers a collaborative framework with centralized storage and
    contact points, fewer visibility barriers, and the opportunity to enact simplified,
    standardized processes.
• Dynamic supply chain: cloud-based platforms are inherently elastic,
 making it possible to scale up with minimal waste of time and capital
   • ability to switch applications entirely without a lot of added cost or complexity
   • ability to enter new markets or launch new services quickly

Possible services related to
cloud
Cloud computing applications for functions such as:
   •   network strategy
   •   inventory management
   •   warehousing
   •   transportation

Next cloud computing applications for processes such as:
   •   global trade compliance
   •   replenishment planning
   •   order processing
   •   transportation load building
   •   fleet management
   •   transportation route planning

Security in the cloud: It is
both the #1 opportunity and
the #1 concern
• Most (87%) believe cloud will not impact or will
  actually improve their security posture
• Yet, they rate security as their #1 concern. Top threats:
   1.   Mass malware outbreak at your cloud provider
   2.   Hacker-based data theft from your cloud provider
   3.   Sharing sensitive data insecurely via the cloud
   4.   Rogue use of cloud leading to a data breach
   5.   Data spillage in a multi-hosted environment
   [Symantec report, 2011]

Q&A

 “Would you put your   • Never
  data in a cloud?”
                       • What?
 “Would you put your   • Do I have an alternative?
  money in a bank?”

 Learned lesson: answers depend on the epoch

Secure cloud storage:
solutions exist

The solution is
  encryption

A Cloud provider MUST have a
strong committment on security

 • Analysis of employees (past records and way of conduct, including strong
   logging)
 • Security team: 100+ experts
 • Integrated security
    • Physical (24/7, electronic and biometric accesses, CCTV, multiple generators)
    • Continuous monitoring of threats and vulnerabilities
    • Security embedded in the lifecycle software development
    • Auditing and assessment
    • Incident Response Teams
 • Certifications: Safe Harbor, PCI, SAS70, FISMA, …

 Is security in your data center adequate to your expectation?

Mature industry

• Complexity must be masked
• Separation between product and security is a demonstration that
  the computer industry is still immature
• Can you imagine a scenario similar to what happens in IT in any
  other industry?
   Car dealer: «Hey, before arriving at home, remember to buy brakes
   for your new car»

• Security is embedded in any mature industry:
   •We expect breaks in the cars, a house with the door, a door with its lock, a safe
   electric tool, a gun that does not explode, potable water from the faucet
   •and we sue companies that do not satisfy our expectations

What users expect

Modern users are platform-free:
  • They do not know what operating system Google (or Facebook or
    Skype) use
  • They do not know the venues of Internet data centers
  • They do not know where their data are and what providers do with their
    data
                       And they don’t care
  All provided services must come with dependability,
      usability, scalable performance, and security

Security by design

 Security will not disappear, but it will be managed by the
 providers and not by the users and companies anymore

 In the future ‟every (interesting) IT application will be
 characterized by trust and reputation”

 Amazon, Apple, and Google will do it for your services and your
 data as Mercedes and Ferrari guarantee for your cars

Security challenges

• Applications of cloud providers cannot be examined by the

                                                                       More psycological issues
  customers
• Loss of physical control
• Trusting vendor’s security model, but everything is a
  matter of trust:
   • Do you trust in all producers of the software installed on your
     PC?

• Customer inability to respond to auditing
• Obtaining support for forensics and investigations
• Indirect administrator accountability

   • Users will “trust” cloud providers to manage their
     data and services like they learned to trust banks
     with their money

Conclusions

 ‟The rise of the cloud is more than just another platform shift that gets
 geeks excited. It will undoubtedly transform the IT industry, but it will
 also profoundly change the way people work and companies
 operate”        [The Economist, 2011]

 Supply chain’s migration to cloud: not “if”, but “when”
 “While it will take time for supply chains to transition to cloud computing,
 we believe the operational benefits and potential savings from
 clouds are too great to ignore”

  If your organization has not yet started its journey to the cloud, now
 it’s the time to start