Predrag Matkovic

Decision Making in Logistics
Pere Tumbas,
Veselin Pavlicevic
Processes Supported by Cloud
Article Info:
Logistics processes in a globalized economy are increasingly complex, dynamic, and
Received 25 January 2014 distributed. These characteristics pose major challenges for logistics management.
Accepted 12 February 2014 Planning, organizing, leading and coordinating processes have become progressively
UDC 004:005 more complex activities that are carried out by an increasing number of internal actors.
Information inputs and outputs of these processes are more diverse and complex, with
Recommended citation: a greater number of users. Decision making is distributed in a way that all actors within
Matkovic, P., Tumbas, P., Pavlicevic, V. these processes make decisions locally and autonomously. Development of a unified
(2014). Decision Making in Logistics and open logistics information platform aimed at integrating various (heterogeneous)
Processes Supported by Cloud Computing, logistics sources and data would facilitate improvement of the logistics operation
International Scientific Journal of efficiency and also reduce costs, enhance competitiveness, and enable advance of the
Management Information Systems, 9 (1), logistics system. Logistics information platform is the core and key development factor
of the modern logistics system. Construction of this electronic platform can greatly
promote the information oriented (can greatly improve the information necessary) for
modern logistics development. In addition to that, it would provide essential support in
making strategic and operational decisions in logistics processes.
This paper analyzes decision-making activities at different levels of logistics process
management and explores the possibility of using cloud computing technology based
on their key characteristics. In addition to that, the authors identify the different types of
cloud computing architectures and cloud deployments models that are most frequently
utilized for decision making in logistics. Research results include identified benefits and
limitations of application of cloud computing technologies in supporting decision
making in logistics processes.

logistics processes, cloud computing, decision making

1. Introduction and decision making in a changing environment.
Intensive utilization of information technology that
The environment where managers make decisions provides timely transaction processing and support
has changed significantly these years. Organizations in decision-making processes has an especially
design their products in one country, purchase important role in the execution of complex
materials and raw materials in another, production management activities.
is carried out in a third country, and finished In supporting complex, dynamic and distributed
products are marketed in numerous countries logistics processes, organizations increasingly use
around the world. At the same time, logistics information technologies. Logistic process
processes were the first processes to be management became inconceivable without the
outsourced. New logistics service providers, whose support of ICT technology. Therefore, the choice
particular focus is on their core competencies, have of mode of transport, stock quantities, mode of
emerged. Specialization has become the goal for storage, locations and number of distribution
logistics providers as well. Hence, they warehouses, decisions regarding new market
differentiated their operations based on the penetration, determining the profitability of some
different logistics resources and processes consumers and levels of services represent
managed. Under such circumstances, a great examples of activities in strategic decision-making
number of logistics operators appeared: main where computer systems are utilized. Of course,
business owners, fourth party logistics service the application of computers is even more
providers, third party logistics service providers, intensive in planning, execution and control of
second party logistics service providers and first operational activities. Certain parties of the logistic
party logistics providers. Logistics processes, as system use specific applications within their
transaction intensive, are abundant with various enterprise information systems for management of
data used by numerous parties in logistics operational activities and decision making at an
processes for effective and efficient management organizational level. These are rarely widespread
Predrag Matkovic, Pere Tumbas, Veselin Pavlicevic

software solutions; most often these are completely experience from a logistics information platform
different applications that are hard to connect, and deployed in the cloud?
enabling data exchange among them poses a Selection of sources – Selection criteria through
challenging task. which we evaluated sources was based on research
Cloud computing is relatively new paradigm in experience of the authors of this paper. The
the computing world, quickly developing and following sources have been taken into
attracting a number of users. Cloud computing consideration: Science Direct, Wiley Interscience,
represents a new way to outsource. Cloud Emerald Publishing, AIS digital library and Scholar
computing services provide consistent global Google. The following journals were particularly
platforms, shared real-time data, faster decision- singled out: Journal of Operation Management,
making, improved customer service, greater Journal of Supply Management, Journal of
automation and efficiency. In the domain of Logistics Information Management, International
strategic and operations management of logistic Journal of Physical Distribution and Logistics
activities, cloud logistics, as an innovated concept, Management, Journal of Business Logistics, and
should enable effective and efficient management International Journal of Logistics Management.
of distributed logistics resources, especially in These journals were specifically selected for review,
volatile, uncertain and complex environments. as they represent significant research in logistics.
The second section of this paper presents the Once the sources were defined, it was necessary
applied research methodology, based on systematic to describe the process and the criteria for study
analysis of selected literature and its expert selection and evaluation. The inclusion and
interpretation. The subsequent chapter, literature exclusion criteria of this research were based on
review, contains a brief elaboration on the concept the research question. Therefore, we established
of cloud computing technologies, types of cloud that the studies must contain issues and topics
computing architecture, cloud deployment models which consider cloud computing in logistics, and
and their characteristics, followed by an overview that these studies must also describe strategic and
of decision-making activities and processes in operational decision-making process activities in
logistic processes at an enterprise level and the logistics.
logistics system as a whole. The fourth section Review execution - During this phase, the
elaborates on decision making activities in logistics search in the defined sources was executed and the
processes and potential application of cloud obtained studies were evaluated according to the
computing in these activities. Finally, the last established criteria. After executing the search
chapter identifies prospective benefits of applying chain on the selected sources, we obtained a set of
clouds logistics to support decision making about 90 results which were filtered in accordance
processes, along with possible courses for its with inclusion criteria which resulted in a set of
further development and use. about 60 relevant studies. This set of relevant
studies was once again filtered with the exclusion
2. Research Methodology criteria to produce a set of studies which
corresponds with about 40 primary proposals listed
Systematic review of cloud logistics - A systematic under references.
review of the existing literature on cloud
computing logistics was carried out for the research
3. Literature review
on the selected topic, not only in order to
summarize the existing studies related to the 3.1. Overview of Cloud Computing
application of cloud computing technologies in A large number of distinguished authors have
logistics processes, but also to identify and analyze made efforts to define the concept of cloud
the current state and the most notable possibilities computing and specify technologies associated
for applying cloud computing to support decision with this term in academic and professional
making in the domain of logistics. literature. The list of proposed definitions of cloud
Question formalization - The purpose of this computing is extensive. It is especially difficult to
paper is to determine whether decision-making formulate a single clear definition of cloud
processes in logistics would benefit from use of computing, due to a vast variety of elements
cloud computing at the enterprise level, and also at associated with this concept (Youseff, Butrico &
the logistics system level. Specifically, what Da Silva, 2008). The most often cited definition,
advantages and disadvantages may logistics however, is the one by the National Institute of
enterprises and all other actors in logistics systems Standards and Technology (NIST): "Cloud

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Decision Making in Logistics Processes Supported by Cloud Computing

computing is a model for enabling ubiquitous, five fundamental characteristics, involves three
convenient, on-demand network access to a shared service models and four deployment models. The
pool of configurable computing resources (e.g., five essential characteristics of cloud computing
networks, servers, storage, applications, and are:
services) that can be rapidly provisioned and
▪ On-demand self-services: A user can obtain
released with minimal management effort or
computing capabilities as needed, automatically,
service provider interaction." (Mell & Grance,
without requiring human interaction with
2011). In other words, "cloud computing is a large-
providers of each service.
scale distributed computing paradigm that is driven
by economies of scale, in which a pool of ▪ Broad network access: Cloud capabilities are
abstracted, virtualized, dynamically-scalable, available over the network and accessed
managed computing power, storage, platforms, and through standard mechanisms that promote use
services are delivered on demand to external by heterogeneous thin or thick client platforms.
customers over the Internet" (Foster, Zhao, Raicu ▪ Resource pooling: The provider’s computing
& Lu, 2008). resources are pooled together to serve multiple
NIST definition primarily reflects the providers’ consumers using multiple-tenant model, with
perspective of cloud computing. From the different physical and virtual resources
consumers’ perspective, the phenomenon of cloud dynamically assigned and reassigned according
computing is described as described as a new cost- to consumer demand.
efficient computing paradigm in which ▪ Rapid elasticity: The cloud is flexible and
applications, platforms, networks and ICT scalable to suit consumer immediate business
resources power can be accessed by consumers needs. Cloud services can be rapidly and
thru a Web browser, without any knowledge or elastically obtained, in some cases automatically,
concern about the location of these resources, to quickly scale up and rapidly released to
while all these resources/services are available on a quickly scale down. To the consumer, the
pay-per-use basis. Research on consumer capabilities available for hire often appear to be
preferences of cloud service attributes resulted in unlimited and can be purchased in any quantity
the following list of attributes that were most at any time.
frequently stated as important by the respondents ▪ Measured service: Use of cloud computing
(Koehler, Anandasivam & Ma, 2010): security and resources can be measured, controlled, and
reliability, provider reputation, required skills, reported on, providing transparency for both
migration process, pricing tariff, cost compared to the provider and the consumer of the utilized
intern solution, and consumer support. Security service. Cloud computing services often possess
and reliability are attributes that consumers metering capabilities, which enables control and
consider to be knock-out criteria, while the most optimization of resource utilization. This
important among other attributes are the implies that IT services are charged per usage
reputation of the cloud service provider and the metrics – pay per use.
use of standard data formats. These two attributes
are indicated by consumers as more important than Apart from the essential ones, there are some
those related to financial aspects, such as cost other significant features of cloud computing
reduction or pricing tariff choice. (Petkovics, Tumbas, Matkovic & Baracskai, 2014);
Among various definitions of cloud computing, (Seres, Horvat, & Horvat, 2011):
a particular one that looks at this concept ▪ Security of services - implementation of the
holistically, from the perspective of application and most rigorous cutting-edge security measures
infrastructure, should particularly be highlighted. for service provision;
According to this definition, "Cloud computing is ▪ Multitenancy - a single instance of an
an IT deployment model, based on virtualization, application serves multiple consumers (tenants)
where resources, in terms of infrastructure, with the possibility (for the tenants) to
applications and data are deployed via the internet customize some details of the software
as a distributed service by one or several service applications;
providers. These services are scalable on demand ▪ Increased reliability - because errors are
and can be priced on a pay-per-use basis." constantly removed and repaired;
(Leimeister, Böhm, Riedl, & Krcmar, 2010).
▪ Identity management and access control -
According to the NIST, cloud computing has
application of advanced techniques in identity

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Predrag Matkovic, Pere Tumbas, Veselin Pavlicevic

checks and access control in order to provide development failure risk, increased security and
legitimate data use; faster time to market.
▪ Diverse platform support, where cloud ▪ Software as a Service (SaaS) - It is the highest
providers often provide services with built-in level of cloud computing service. This layer
support for an abundant compilation of client covers service-enabled remotely-accessible
platforms to reach a broader base of users; software packages. Providers deliver a single
▪ Centralization of infrastructure and lower application through the browser to thousands
expenses of operation and maintenance; of consumers using a multi-tenant architecture.
▪ Faster development - cloud computing The consumer uses the services for business
platforms with a large number of services and purposes via Internet, as a communication
preset templates for application development medium. By using SaaS services, consumers get
considerably facilitate the development process. complete and functional solutions, with the
only necessity to customize and use it, whereas
Cloud computing services are categorized providers retain all other obligations. Benefits
according to the type of capability provided to the of SaaS for the consumer include: pay-per-use
consumer into three service models: Infrastructure software, infrastructure maintenance and
as a Service, Platform as a Service, and Software as software updates, global accessibility, easier
a Service (Weinhardt et al., 2009). collaboration, compatibility, and easier
▪ Infrastructure as a Service (IaaS) - It is the
lowest layer of cloud computing. At this level, Four deployment models have been defined for
the service includes lease of hardware resources cloud computing; the distinctive feature being who
to the consumer. Resources are normally is entitled to consume underlying cloud
provided using virtualized hardware, and the infrastructure resource. These are: Private cloud,
consumer is responsible for managing these Community cloud, Public cloud and Hybrid cloud.
resources and installing software onto them.
The provider owns the equipment and is ▪ Private cloud: The cloud infrastructure is
responsible for housing, running and dedicated to exclusive use of a single
maintaining it. Consumers can generally access organization with a large number of staff/end
resources on-demand, paying only for what they users. Private clouds are set up within a specific
use. The key advantages of IaaS for the private community. This may be a single
consumer are: scalability, portability, unlimited institution or a group of individuals in
hardware capabilities, predictable and collaboration across multiple locations. Private
guaranteed usability and beneficial costs, expert cloud is preferred in the following case: for
guidance, system acquisition bypass, enhanced customized applications and service; in case of
agility and innovative business racing. highly sensitive data; for extremely mission
▪ Platform as a Service (PaaS) – It is the middle critical and high-load appliances; when high
layer of cloud computing. At this level, performance is necessary; full control is
providers offer consumers a development demanded (legal, privacy); and as a first step in
platform as a service, which they can use to cloud migration strategy.
build their own software solutions and deploy ▪ Community cloud: The type of cloud service
them on the cloud infrastructure. PaaS provider that provides resources to a specific group of
is responsible for managing operative systems, persons or organizations with a common
network resources, servers and storage, whereas interest. These may be organizations engaged in
the PaaS consumer manages the deployed strategic partnerships or those that serve same
application and customizes the application- communities. Community clouds are known to
hosting environment. PaaS covers a wide range be more expensive than public clouds, but
of service types, from general value-added usually offer services tailored to the
services on top of cloud infrastructure to highly requirements of the community. Community
advanced, domain-specific platforms. The main cloud is mostly used in the following cases:
benefits of PaaS for the consumer are: prepared when there is a well-identifiable community
platform for fine tuning and use, consumers do with clear common interest and specific
not have to maintain hardware, operative demands; there is a need for collaboration
system, network infrastructure, development between institutions and researchers; when
platforms, servers, reduced costs, lower sharing of resources leads to cost reduction;

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Decision Making in Logistics Processes Supported by Cloud Computing

when procurement of cloud services in shared 3.2. Decision Making in Logistics Overview
context is easier. A characteristic trait of the modern enterprise is
▪ Public cloud: The type of cloud deployment the growing importance of its relationships,
that provides services to any consumer over the interactions and interdependences with other
public Internet. Public clouds are provided by entities from its business environment. Under
commercial organizations who generally offer a circumstances such as increasing competitive
certain range of cloud related services and pressure, companies develop their relationships,
resources, and bill consumers for their usage. cooperation and collaboration with their partners
Public cloud is available for personal and in a way that provides substantial benefits for all
business use. Public cloud is used in case of parties. At the same time, companies constantly
incidental or ad-hoc need for resources; public seek solutions to ease and improve their
sharing of research results; in case of need for collaboration and cooperation with their partners.
commodity or standardized IT services; and
when IT staff resources and knowledge is
▪ Hybrid cloud: This design of cloud
deployments present the mix or composition of
two or three types of the above clouds. The
clouds remain unique entities, but are tied
together by standardized technology that allows
a degree of data and application portability.

When choosing infrastructure deployment
models, organizations must bear in mind the
Figure 1 Core concepts of cloud computing
numerous limitations associated with particular
cloud computing model, or can opt to combine Logistics sector covers processes and activities
several models to solve certain problems and of variously sized companies, and a multiplicity of
facilitate their operations. services on a global level. It includes very large, but
From the viewpoint of locality of also small firms, offering a wide range of services.
implementation, cloud deployment models are Services offered to their customers ranges from
internal and external (Petkovics, Trninic & simple transport services, through forwarding,
Djurkovic, 2013). warehousing, palletizing, packaging, to full supply
▪ Internal cloud - where above mentioned basic chains management services, all the way to virtual
services (IaaS, PaaS and SaaS) are offered as service integration. Their activities may be limited
internal services, i.e. realized by an internal IT to a region, country, continent, or reach the whole
organization (in-house implementation) for world (Kawa & Ratajczak-Mrozek, 2013). In order
internal usage (usually). In-house computer to ensure successful execution of logistics
clouds are physically located within the processes and activities, as well as a fast and
organization’s premises and protected by the appropriate flow of information between individual
organization's firewall. Access is provided actors in a logistic system, all categories of logistics
through the intranet, and the cloud is intended operators (logistics service providers) must use
for internal use only (in most cases); appropriate information technology. Logistics
▪ External cloud - where basic types of cloud service providers primarily apply IT in order to
computing services are not hosted in-house. An increase efficiency and automate their work.
external cloud can be public or private, but However, satisfaction of potential and existing
must be implemented by an external IT customers’ needs also poses itself as an important
organization. goal. Logistics operators are most commonly
divided into the following categories:
The brief overview of the cloud computing ▪ Main Business owner (MB) – the main business
concept presented in Fig. 1. particularly highlights entity around which logistics processes and
its characteristics that render it applicable in activities are built.
decision making activities in logistics processes. ▪ Fourth Party Logistics Service Provider (4PL) –
a general contractor; they manage the entire

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Predrag Matkovic, Pere Tumbas, Veselin Pavlicevic

logistics process, integrating different services provide managers in logistics processes with exact
offered to logistics service providers or to other and timely information to react fast and make right
actors. The 4PL assembles and manage decisions.
resources, knowledge and technology of other Two basic approaches to the development of
logistics service providers. They are also defined DSS applications are used most commonly:
as the Virtual Logistics Provider.
▪ Implementation of the integrated DSS at the
▪ Third Party Logistics Service Provider (3PL) – a
company level (enterprise, organization), partly
service operator who manages the main part of
including the field of logistics as well, and
the logistic process outsourced by the MB to
▪ Implementation of a specific and independent
1PL or 2PL (or other 3PLs). They manage the
DSS applications restricted to the domain of
flow of goods between different organizations
in logistics processes.
▪ Second Party Logistics Service Provider (2PL) – Table 1 Overview of activities within logistics processes and
manages a single activity (or subprocess) of the types of decisions made (Tumbas, Sedlak & Matkovic, 2007)
logistics process. Logistics processes and activities Decision type
▪ First Party Logistics Provider (1PL) executes a In transport:
single logistics activity. Choice of transport model s
Choice of transport way s
Logistics operators most commonly use two Routing vehicles at land and sea o
types of information systems for managing their Delivery planning o
logistics processes and activities and decision- Delivery routing and distribution o
Choice of carriers o
making - Enterprise Resource Planning (ERP) and Vehicle distribution o
Decision Support Systems (DSS). DSS, as Assessment and control of consignment notes o
interactive computer based information systems, Administration claims o
have the following core (basic) characteristics Performance measuring o
(Eom & Lee, 1990): In warehousing:
Determination of storage number and location s
▪ Support decision makers, not replacing them in Choice of storage way s
decision-making; Sorting and packing of storage goods o
▪ Use internal and external data and models; Transfer of storage goods o
▪ Solve problems of different complexity Warehousing o
Storage planning and design o
(unstructured, semi structured and structured Choice of equipments for storage goods o
problems), and Performance measuring o
▪ Focus on the effectiveness, not efficiency in the In order processing:
process of decision-making. Choice of volumes of automated support s
Order tracking and evaluating o
The DSS applications in the field of logistics Indebtedness control o
Invoice harmonization o
give the support to decision makers in a huge
Performance measuring o
number of logistics processes and activities on In stocks management:
strategic and/or operative decision-making level. Choice of restocking systems s
An overview of most significant processes and Stocks forecasting o
activities is given in Table 1. Stocks evidence o
In order to fulfil current expectations, DSS Tracking of transferring o
applications in the field of logistics must adapt to Tracking of stocks turnover o
In rendering services:
completely changed conditions in the global
Determining the level of rendering service s
economy, especially to the global market that has Measuring the level of rendering services o
never been bigger. Market expansion and
development of multinational corporations s - strategic decisions o - operative decisions
requires information, communication and
distribution networks, facilitation of a free flow of However, the development of new information
goods and information that cross national borders. and communication technologies enable DSS
DSS become strategically important for improving (decision support systems) to have new possibilities
service quality, competitiveness and utilizing both at macro and micro levels. RFID technology,
positive effects of economies of scale in mobile data transfer systems, positioning systems,
transnational logistics processes. DSS applications networking technology, network security systems,

International Scientific Journal of
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Decision Making in Logistics Processes Supported by Cloud Computing

machine learning using artificial intelligence 2012). Furthermore, in a different business
methods, robotics, the data warehouse environment shaped by globalization, cooperation
/multidimensional databases, data mining, big data, and collaboration amongst a great number of
internet of things, intelligent agents, www logistics operators in the realization of logistics
technologies, are just some of technological processes and activities, cloud computing imposed
prerequisites. With regard to growing numbers of itself as an operational necessity. Cloud services are
partners within logistics networks and a owned by multiple providers, co-located in a single
simultaneous expansion of the quantity of software data center. Data centers are located globally and
solutions used, compatibility of different systems is provide access to any device that has Internet
becoming increasingly important (Scholz-Reiter, connectivity (e.g., mobile phone, a PDA or a
Windt, & Freitag, 2004). Such circumstances have laptop). Computing resources are obtained and
generated the need for standardization of awarded in line with users’ needs (Zhang, Cheng, &
interfaces, as to ensure their interoperability. Boutaba, 2010).
When it comes to decision making in a logistics Cloud computing services are suitable for
system, it should be pointed out that the logistics application in logistics to provide consistent
services industry lacks solutions that would logistics global platforms, facilitate real-time data
integrate services of different operators in one sharing, enable faster decision-making, improve
place. In addition, a great number of small and customer service and achieve greater automation
medium (SME) logistics service providers, who are and efficiency. The logistics operators have access
generally more flexible, often lack the needed to three types of services: SaaS, PaaS and IaaS.
resources for growth and have limited or no IT- SaaS allows them to run existing on-demand online
competences and investments. Finally, absence of applications accessed over the Internet (e.g.
formal data semantics prevents automated data Warehouse Management Systems, Transportation
integration. Management Systems...). PaaS allows them to
Logistics platforms appear as a solution to the create their own applications using supplier-specific
aforementioned problems. There is no consensus tools and languages (e.g., OMS Platform, eBuilder,
on what represents a logistics platform in the Google App Engine, Microsoft Windows Azure
referred literature – authors use the term in a wide and IaaS allows users to run
variety of contexts. In practice, the term logistics applications of their own choice on cloud hardware
platform is used differently and in diverse cases. It (e.g. AmazonEC2, GoGrid and Flexiscale) (Zhang,
is clear that the use of the term is not always et al., 2010).
appropriate. After considering a number of Cloud computing applications can be deployed
definitions, a definition that best suits the research via public, community, private or hybrid clouds.
was chosen. A logistics platform is any kind of The deployment model depends on the level of
resource base for the implementation of logistics security, reliability, performance and cost a certain
processes in a predefined environment. It offers company requires. Firms select different types of
customized infrastructure, a well-developed deployment, depending on individual business
information-communication system, logistics needs (Aviles & Rutner 2012). In public clouds, the
technology, specialized logistics service work force, infrastructure and services are available for open
friendly rules and favourable support on the use by the general public. In such way, companies
highest level (Gajsek, Lipicnik, & Simenc, 2012). A are not required to invest in infrastructure, but on
platform that supports integrations, i.e. the other hand, firms lack control over data,
implementation of inter organizational logistics network and security settings. Private clouds are
processes both within and between supply chains designed exclusively for a single organization with
aimed at improving operational efficiency may be multiple users and are not available to the general
referred to as a logistics information platform. public (Armbrust et al., 2010). Private clouds offer
the highest degree of control over performance,
4. Research Results reliability and security, but they do not provide up-
front capital savings. In hybrid clouds, one part of
Cloud computing represents a shift from locally the service infrastructure runs in private clouds,
installed programs, servers and computers in the and another part runs in public clouds, giving
enterprise, to the Internet deployment software tighter control and security and also facilitating on-
and computing capacity, helping reduce demand service expansion and reduction. (Zhang
information technology operating costs, et al., 2010), (Aviles & Rutner 2012).
maintenance and updates costs (Aviles & Rutner

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A well-designed cloud can be reliable, secure, ▪ Market Place for product and service offers and
and suitable for logistics processes and demands, platform for adding e-commerce
applications. Using a cloud to deliver decision activities to the corporate business models;
support can reduce capital expenses and reduce ▪ Platform for the management and optimization
operational costs. Proper deployment can provide of collaborative business activities of multiple
significant savings, better IT services and a higher business partners.
level of reliability. Some additional benefits of
implementing cloud computing are: agility, greater Analysis of the aforementioned use cases leads
reliability, accessibility to software and device, to a conclusion on their interrelation and
improved security, better suitability for distributed interdependence. Outsourcing of IT resources and
logistics operations, reduction in capital expenses, related services enables logistics enterprises,
reduction in direct and indirect operating costs, especially micro, small and medium-sized ones to
availability on many diverse devices, scalability, access necessary resources at a desired level. By
expertise, and location independence. purchasing certain services, for example at the IaaS
Logistics information platform is especially level, logistics companies gain readily available
significant to decision making in logistics resources at the costs which are in line with their
processes. Generally speaking, the logistics needs. The most popular IaaS partners for
information platform is a general information European SaaS vendors are Amazon, OVH,
exchange platform, which applies information and Hetzner, 1&1, Rackspace, Microsoft and Host
communication technologies to collect, classify, Europe. When it comes to SaaS, logistics
store, analyse, evaluate, publish (release), manage companies have the opportunity to use versatile
and control relevant information on logistics software services in the cloud, such as Customer
operations, processes and management (Tang & Relationship Management systems, Electronic
Du, 2009). Logistics information platform provides Document Management systems, Enterprise
applications for inter-organizational logistics Resource Planning systems, different collaboration
operations. The platform involves multi- suites, accounting software, Supply Chain
stakeholders such transporters, warehousing Management systems, Workflow Management
agents, distributors, suppliers, insurance systems, route planning systems, as well as other
companies, banks and other financial software services offered in the market. Cloud
organizations, customs, regulatory bodies, computing has made these services available and
educational and research organizations etc. The affordable to logistics enterprises of various sizes.
most important functionality of a logistics Integration, Synchronization and Sharing of
information platform is integration of various data created and utilized by multiple users is the
information resources to facilitate data exchange, next use case to become available, affordable and
implement data sharing and information suitable form an increasing number of logistics
transformation (Zhen, Gui-Cheng, & Bing-Wu, companies, once again owing to Cloud Computing.
2012). Numerous functionalities aimed at easing Data management has become a major business,
collaboration and cooperation of all participants and among the most prominent Cloud Data
within logistics process are suitable for Management services providers are Microsoft One
implementation using cloud computing Drive, DropBox and Google Drive. This type of
technologies. Identified functionalities of the services is used for data exchange both within
logistics platform and expected benefits associated organizations and among different ones, which is
with them are presented in the following text. presented in Table 2.
The following generic use cases, interrelated in Market Place for product, service offers and
multiple ways, were identified and are the logistics demands is the third use case that offers new
cloud (Arnold, Oberländer & Schwarzbach, 2013): possibilities to logistics enterprises.
▪ Outsourcing of IT resources and related Implementation of this use case is realized thru e-
services, i.e. hardware, software applications, commerce software solutions in the cloud. In this
and data pools from local (on-premise) IT- sense, this use case could be considered as
systems into a cloud; Outsourcing of software, i.e. use of SaaS.
The fourth use case is the Management
▪ Integration, Synchronization and Sharing of
platform, which is intended for managing and
data created and utilized by multiple users;
optimizing logistics operations. All of the listed use
cases and possibilities identified within each of

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Decision Making in Logistics Processes Supported by Cloud Computing

them are available thru different, independent computing technologies offers several technical
services. Placing all those capabilities under one and financial advantages, which are listed below
umbrella and implementing them in an (Aymerich, Fenu, & Surcis, 2008).
environment suitable for logistics enterprises is the
course for developing a logistics platform based on Technical and architectural advantages are:
Cloud Computing.
▪ Cloud computing easily handles peak load
Table 2 Examples of Integration, Synchronization and situations without the need for additional
Sharing of data (Arnold, Oberländer & Schwarzbach, 2013) hardware infrastructures that would remain
largely underutilized. Hardware and
File exchange across
borderlines of single communication resources can be virtualized and
Typical intra-organizational uses provided to customers as virtual servers, which
enterprises and
organizations they manage themselves.
File synchronization of mobile ▪ It is possible to use the processing power of the
actors and business units, such as cloud to do things that traditional productivity
File exchange with
trucks and other vehicles, external
service teams, smart devices of
clients; applications cannot do.
employees etc; ▪ The system delivers greater scalability as it is
File synchronization of mobile possible to add “on demand” computational
actors and business units, such as resources.
File exchange among
trucks and other vehicles, external
service teams, smart devices of
business partners; ▪ Cloud computing infrastructure accelerates and
employees etc; fosters the adoption of innovations. It alleviates
File exchange with the need of innovators to find resources to
infrastructure operators develop, test, and make their innovations
Business data exchange and such as seaports, available to the user community.
synchronization within decentralized airports, intermodal
organizations. terminals and authorities
▪ Cloud computing infrastructure allows
such as customs enterprises to achieve more efficient use of their
authorities. IT hardware and software investments. It
increases profitability by improving resource
5. Conclusion utilization.
The paper explores the issue of applying cloud Advantages for the logistics operators - single
computing technologies to support decision users and enterprises:
making activities in logistics processes. Activities
related strategic and operational decision-making at ▪ The user is no longer tied to a traditional
the level of individual logistics operators, as well at computer to use an application, or has to buy a
the level of a common logistics information version specifically configured for a phone,
platform were analysed within the research. PDA or other device. Every device that can
Regardless of the level of observation, it can be access the Internet will be able to run a cloud-
concluded that activities, i.e. operations of logistics based application.
processes are very complex and that decision ▪ Users will not have to concern themselves with
making process is carried out in conditions of storage capacity, compatibility and similar
uncertainty. Hard data and information from issues.
different types of computer based information ▪ The user always uses the latest version of the
systems form the basis for decision making, software when accessing an application on the
although soft skills, such as knowledge, intuition cloud.
and experience, also play a very significant role. ▪ Cloud computing is particularly beneficial for
Cloud computing is a promising approach to small and medium businesses, where effective
implementation of a contemporary concept of and affordable IT tools are critical for boosting
logistics systems. Use of cloud computing productivity without excess spending on in-
technologies yields many benefits, but also bears house resources and technical equipment.
certain risks. Detailed analyses must be carried out ▪ Also large businesses are moving to the cloud as
before its implementation, as to ensure that the well, for a variety of reasons, such as cost
total cost of ownership, security, confidentiality, cutting, remote access, ease of availability and
functionality, integration and process consistency real-time collaboration capabilities.
requirements have been met. Application of cloud

International Scientific Journal of
Management Information Systems 19
Predrag Matkovic, Pere Tumbas, Veselin Pavlicevic

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Predrag Matkovic Pere Tumbas Veselin Pavlicevic
University of Novi Sad University of Novi Sad University of Novi Sad
Faculty of Economics Subotica Faculty of Economics Subotica Faculty of Economics Subotica
Segedinski put 9-11 Segedinski put 9-11 Segedinski put 9-11
24000 Subotica 24000 Subotica 24000 Subotica
Serbia Serbia Serbia
Email: Email: Email:

International Scientific Journal of
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