At the heart of your logistics operations, your transportation management system (TMS) is essential to efficiency and your access point to a community of carriers. Not only does your TMS provide you with access to your fleet or transportation network, but it also delivers crucial decision-driving data to help in execution and top-down visibility no matter where wheels, wings, or carriers enter the equation.
As with most logistics systems, however, simply having a TMS at your disposal doesn't automatically grant you "Best-In-Class" status. Configuring the system, loading shipper and carrier data, and aligning with business rules are complex and essential tasks to achieving full utilization from your technology platform. When you choose the TMS and the right partner to manage your TMS, you're positioned to experience a steep change in the effectiveness and efficiency of your supply chain.
Need to know if your TMS is truly working for your business needs? Here's how to find out:
Determine If You're Getting Maximum Financial Benefits
A "smart fitting" TMS will give you an access point to a capacity network of capacity, enabled through a third party logistics provider, as well as a procurement advantage in the process. It should function as a community that builds and maintains connectivity with thousands of carriers, either passively or actively.
Your TMS should not only provide the ability to access markets and carriers; it should facilitate developing the connections you already have in place.
A solid TMS system needs to give you power over your execution-focused operations. From shipment consolidations to controlling your automation and tender processes, you should be able to trust your TMS system. Just as importantly, you should feel confident that shippers will be tended to the lowest-cost solution every time, whether the deciding factor is location, time, or another variable.
In-transit and historic data visibility are both enabled in a TMS environment. It's a simple fact—if you don't know where your shipments are in real time, you can't fix potential issues or communicate data to your anxious customers. With trustworthy real-time data ushered in through your TMS, however, you should be able to commit to continuous improvement models and avoid the "time sink" and inaccuracies of manual control models. All data elements captured are reportable through automated report-writers embedded in most TMS applications.
More time can be spent on the analysis, rather than on the collection and normalization of data from multiple sources.
Explore Potential Technological Benefits
As arguably the biggest "plus" of a good TMS system, centralized planning gives you excellent quality data—updates on your carriers, changes in direct points, and more—that you can use to optimize your approach and beat the competition. Manual approaches aren't just slower; they're extremely vulnerable to human error—not to mention the process is considerably harder to backtrack without a digital paper trail to follow and tweak.
While it's never a pleasant topic to consider, staff turnover can mean huge headaches if the wrong person leaves your logistics team on a manual system. If they have specialized knowledge, they take that with them when they leave the company, either knowingly or unknowingly.
With a TMS, you should retain both the information and the system, which is the best possible outcome for your company in a turnover situation. Once your load carrier contracts into your TMS, that information remains safe in the system, safeguarded against any turnover scenarios. While not quite set-and-forget, your TMS system should be able to continue functioning no matter who's at the helm.
Will My Company Benefit from a New or Optimized TMS?
In a word, yes! A TMS isn't a tool reserved for companies that have achieved a certain size. In fact, adopting one as an SMB will likely help speed the growth process for your company. There's a reason that mid-sized industries comprise the largest growth sector of the 3PL TMS sphere.
As rates are climbing and truck availability is getting scarce, the need for reliable and automated access to carriers is growing. The right TMS can completely transform your business for the better.
Whether you're looking to add a TMS to your company or want to make sure your current TMS is the right fit, look for a partner rather than a product. The right partner can make all the difference. When it comes down to brass tacks, you can expect to spend roughly 8-12% of your annual freight spend by deploying TMS technology with a capable partner. Be prepared for that number to fluctuate up or down depending on your unique network and on whether you buy the software alone or bundled with the expertise to unlock its true potential.
To Sum It Up
Here at Kenco, we don't just offer a superior TMS system for valuable clients like you; we offer the service you need to get the most out of it. With self-service approaches, you might only be using 20-30% of the functionality of the software; we help you get the full value of your TMS from the moment it's in place.
If you don't currently have a TMS, or if you’re looking for a new logistics partner, contact Kenco today. We're ready to help your company dominate your industry, one real-time logistics update at a time. If you’d like to learn more about 3PL’s pricing, read our In-Depth Guide to 3PL Pricing.