For entrepreneurial businesses and start-ups, cloud technology can hold the key to collaborating with larger organisations. Cloud-based global commerce platforms can give businesses starting out capabilities previously held only by more established businesses, levelling the playing field for organisations of all sizes.

Leapfrogging to the cloud

Before the cloud helped networks of companies to collaborate regardless of the IT applications they were each using, the biggest benefactors of globalisation – large, multinational corporations – had the upper hand in dictating the technology requirements they had of suppliers.

Small suppliers, particularly those in developing markets, didn’t have the IT budgets or the in-house technology expertise to get on board. As a result of cloud technology, however, these smaller organisations can now benefit from globalisation by circumventing the need for investment in costly software and infrastructure. They can be equipped to collaborate with larger organisations. In effect, global commerce has ‘leapfrogged’ to the cloud.

The concept of technology leapfrogging isn’t new. It describes the adoption of state-of-the-art technology in areas where prior technology has not previously been deployed. In doing so, it enables ‘greenfield’ companies to leapfrog entire generations of market development and the often costly stage of trial-and-error.

"Global commerce has changed as a result of a technology leapfrog to the cloud"

We saw it happen in parts of the world with telecommunications in particular. In regions of the developing world many people have gone from no telephones at all to the wide-spread market penetration of mobile phones – skipping fixed landlines. Now people who have never used a telephone landline or PC, post on Facebook; they skipped early connectivity through dial-up modems and DSL altogether.

To join the community of businesses trading, transacting and procuring goods and services internationally, companies now don’t need big IT budgets; they don’t need to buy and maintain expensive hardware and software.

They can simply plug into a cloud-based collaboration platform and through it receive orders, secure financing, organise transportation and receive payments. No multimillion dollar enterprise software systems required and no need to log into proprietary portals for each customer, each service provider or each bank.

Small retailers now have access to enterprise-level back-end systems that used to require major investment

This use of cloud computing is empowering a new generation of medium, small and even micro-sized enterprises to go from having no internal IT systems to being able to tap into the business software and collaboration tools that just a few years ago were exclusively available to the most well-funded and tech-savvy organisations in the world.

By leapfrogging to a cloud network, these companies can effectively skip the phase of expensive and complicated enterprise software and, as such, dramatically enhance their chances of success in global commerce.

Cloud technology now also helps enterprises access low-cost financing through banks directly on the platform. They can collaborate with customers to extend payment terms, receive early payments in exchange for invoice discounts, eliminate letters of credit and automate payment reconciliation.

These are complex business processes that require multi-enterprise collaboration and synchronisation. Making them accessible and affordable, not just to top-tier players but all the way down the supply chain reduces barriers-to-entry and creates greater economic diversity.

A cloud-based utility for global commerce

The strong push towards using the cloud for global trade doesn’t only benefit smaller players, though. Large, global manufacturers and retailers looking to markets in Asia, Latin America and Africa for growth have to adopt local sourcing, local manufacturing and local customer support strategies to service a rising new class of demanding customers in these emerging markets.

Moving into new markets requires access to vast supply networks that are capable of delivering goods with speed and agility. It requires the introduction of new partners with different systems, data formats, languages and time zones.

For thirty years, global companies have tried to manage global commerce with conventional enterprise software systems. These systems have been widely successful in managing internal processes like HR, CRM, Production Planning or Accounting, but engaging with outside customers and trading partners in a scalable manner can be another matter.

As divergent as the paths of a small garment supplier in Bangladesh and a major US fashion retailer have been, they now find themselves in a similar technology position.

One missed out on conventional enterprise software systems altogether – because of a lack of resources – while the other spent millions on software licenses, installations, upgrades and implementation only to discover that the inward-facing systems they have don’t help them collaborate. Which is a central need in today’s modern business. In both cases, a commerce platform in the cloud opens up opportunities.

The face of global commerce operations has changed as a result of a technology leapfrog to the cloud, the importance of emerging markets and the need to become a networked company. These trends have given rise to cloud-based utilities connecting trading partners from the smallest supplier to the largest multinational.

Ultimately, by embracing cloud technologies, businesses of all sizes can work together with ease and on equal terms.