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GT Nexus Leader In Cloud Computing Supply Chain Management Case Solution

Solution Id Length Case Author Case Publisher
2087 1240 Words (6 Pages) Ali Farhoomand, Davide Lentini University of Hong Kong : HK1065
This solution includes: A Word File A Word File

The cloud computing technology has been growing prominence. This, together with increased automation in the manufacturing industry, has pulled up the demand for supply chain management software. GT Nexus established itself as the first company to facilitate companies in freight forwarding and shipping and providing a level playing field. But, it had to compete with SAP and Oracle. In the supply chain software industry, however, it had an edge in the market. Hence, the following report will assess how GTN can leverage its position in the supply chain industry to increase sales. 

Following questions are answered in this case study solution

  1. Introduction

  2. Problem Identification

  3. Analysis

  4. Proposed Alternatives

  5. Recommendations

Case Analysis for GT Nexus Leader In Cloud Computing Supply Chain Management Case Solution

2. Problem Identification

GT Nexus is the world’s 9th largest supply chain management software provider and the company has engaged in several mergers and acquisitions to increase its product portfolio and enhance its market share. The company was faced with a situation in which it had to decide how to expand and ensure customer value at the same time. This is because cloud computing technology has been evolving rapidly and holds a huge potential in terms of cost-saving. Hence, it needs to come up with a solution to deliver customer value as well as preserve its leading position in the cloud computing Software as a Service Market. It needs to grow its offerings sustainably so that its subscription-based cloud model would ensure economies of scale for the business and would establish it in the leading position as a supply chain software provider.

3. Analysis

It was found that the shipping software market was huge and that shipping companies were finding it difficult to engage with their potential client. Hence, there is a gap in the market as out of the 70,000 customers in South America. One of the companies could engage with only 6,000 potential customers due to its small size. Hence, small firms would lose out against the large firms that would easily get cargo spaces. Hence, by making an e-commerce platform through which cargo spaces would be traded, GTN platform by GT Nexus allowed it to cater to large as well as small shipping companies and generate sufficient profitability. However, the technology adoption rate is low, which would act as a hindrance (Giunta & Trivieri, 2007).

Apart from this, it can also be seen that GT Nexus has been able to get sufficient support from large carriers who are in support of the project as it would help in improving the customer service and reduce the transaction costs.

However, if GT Nexus would expand its offerings to such an extent, it would come in direct competition with Oracle and ERP, which are the giants in the industry. This would again result in it losing its market share. However, if managed effectively, the business would have the potential to establish itself as the leading logistic management software.

Evaluating the current performance of GT Nexus, it can also be seen that following such advancements, its number of customers grew with important customers like LyondellBasell becoming a part of its portfolio. In terms of direct competitors, GT Nexus currently competes with INTRRA and Cargo Smart, and both are companies focused on offering access to sailing schedules to carriers. Hence, there is a need to come up with a distinct offering to be able to penetrate the market, which already has a high potential.

Also, it can be seen that GT Nexus’s recent merger with Trade Card helped the business expand its offerings and improve its services as it was able to reach a total of 100,000 customers. The merger allowed it to benefit from supply chain intelligence as well as monitor the suppliers’ data in real-time as the parties were able to communicate and coordinate with the multiple stakeholders bringing about supply chain efficiency. Also, it was able to integrate financial aspects into the software, which helped ease client payments, hence improving the overall creditors and debtors’ relations management. Hence, it resulted in greater synergies and improved scale for the business (Lambrecht, 2004).

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