Four potential pitfalls when moving your WMS to the cloud

Asking the question “are there risks to switching to a cloud WMS?” is somewhat analogous to asking the question “are there risks in driving an automobile?”.  In both cases, the literal answer to the question is an unequivocal “yes”, but in both cases, a little bit of training and a cautious approach typically cause the benefits to far outweigh the risks.

1. Cloud WMS connectivity issues

This can occur because your WMS vendor goes offline; it can also occur because the third-party transmission lines – fiber optics or cable – suffer an interruption.  How much business damage would occur if you were without software for an hour?  For four hours?  Private systems typically mitigate this risk with redundancy and detailed disaster recovery plans; what does your cloud provider say?

2. Plain vanilla technology

Your cost and maintenance savings stem from using standard software features, the exact same features that dozens of other hosted warehousing operations are using.  If you ever felt like your WMS software provided you strategic advantage, you may need to be prepared to let it go.  You may not get customizations, but routine upgrades, and the exact same features as other users.

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3. Cloud WMS security issues

‘Cloud WMS Security’ in this case is a broad definition, including who can have access, what access they can have, and how safe and secure your business data is. The pro and con arguments about how big of a risk this is are passionate and conflicting.  Some contend that because the business data is physically centralized and in a structure which does nothing but process data it is much safer as well as harder to find.   Others contend that shared servers are inherent security risks and that cloud WMS security breaches are commonplace. If having your business data hacked would put you at serious strategic or financial risk, do your due diligence here.

4. High switching costs

So you’ve gone through the hassle and change management opportunities of moving to cloud WMS.  It took more time and more resources than you thought it would, but you’re over the hump and things seem to be on course.  After eight months, your service provider gives you heads up that maintenance fees are going to go up 7% at the end of the first year contract. How many unexpected cost increases – how much accumulated disappointment - would it take before you would be willing to knowingly go through the pain of changing to another vendor?  

If you don’t drive a car carefully, the results can be catastrophic.  The same is true if you don’t pick a cloud WMS provider carefully.   But being careful need not mean that you avoid clouds entirely, just like it doesn’t mean that you avoid cars.  Trust, but verify.