Does Your Company Need a Transportation Management System?
Transportation management systems (TMS) are software solutions designed to help supply chain managers with tasks like routing, scheduling and shipment consolidation. The typical TMS allows shipping managers to gather information up and down the supply chain.
A TMS offers numerous benefits to organizations that use them, but is one right for your organization? There are several things you need to consider when deciding if it’s time to acquire or upgrade your current system.
Cost savings and benefits
Research has shown that a TMS can produce a six percent return on shipping costs, which equals $6,000 for every $100,000 spent.
In addition to saving money, using a TMS system can also have knock-on positive effects, such as higher levels of customer service. Through higher visibility and greater speed, customers with have better experiences in dealing with your organization – and that can lead to more business.
Better decision making
Supply chain managers must make difficult decisions every day and a TMS can make those decisions easier by offering greater insight. A TMS creates a digitally connected supply chain, and this allows shippers to more efficiently use mobile devices, cloud computing, the Internet of Things, and other innovations to give their choices.
Furthermore, powerful decision-making tools can allow for supply chain managers can refine their department, and improve the way they both acquire and manage freight. Even small companies, which may not be particularly positioned to leverage all of the opportunities out there, can find ways to effectively leverage a TMS.
Data storage and analytics
Through data storage capabilities, a TMS also allows supply chain managers the opportunity to look back and analyze past decisions.
Some companies are use spreadsheets, calls, messages and email to handle their various transportation components; all of which might be costing them considerable money on an annual basis. A data repository can allow a supply chain manager the chance to see which actions produced the best results and which actions generated less-than-optimal results.
A good TMS can provide insight through dashboards, reports, charts and other features that enable good decision making and lead to cost savings.
Additionally, many TMS solutions contain access or functionality through the cloud. With small barriers to entry, modest upfront costs and ease-of-use, cloud-based applications are widely available and fast-becoming the standard across all industries.
Mitigate the effects of driver shortages
It’s no secret that there is a current shortage of truck drivers, and this fact is severely impacting the shipping industry. A TMS solution can help to navigate these challenging times by providing information on available drivers and shipping capacity.
If this trend is to continue, supply chain managers will need to innovate and a TMS solution will make improvisation that much easier.
At ZDA, we’re dedicated to understanding all the latest developments and trends in the supply chain industry. If your organization is looking for a staffing firm that specializes in supply chain talent, please contact ZDA today to discuss a customized solution for your organization.
