Selecting the best TMS – 10 Things to consider
Transportation Management Solutions are more important than ever and continues to grow the upcoming years as well.
A robust and reliable TMS system offers many advantages and functionalities for companies to automate logistic processes. Nowadays it contains all the functionalities that are needed to manage the logistics processes as optimally as possible. It saves time and therefore adds more speed and efficiency.
You can use a TMS for order processing, invoicing, communication, personnel registration, navigation and fleet management. A TMS is one of the best tools you can get to streamline the logistic component of the supply chain.
The advantages of a TMS
- Time saving through automation and optimization of logistic processes
- Optimal deployment of resources - Planning and capacity errors are prevented
- Continuous insight into data
- Service levels can rise and customer satisfaction will also rise.
3 Models for working with TMS
There are three models for working with a TMS. See their advantages and disadvantages below:
How to select? Here is your top 10 things to keep in mind.
Keep in mind that every business is unique with its own requirements, culture, processes and industry and that includes a unique TMS approach as well. There is no TMS system that is "the" right fit for each company.
As a start think about your long and short term goals and see how a TMS can help you accomplish them.
Depending on the complexity of the type of transport, there are different types of TMS systems. Always look carefully which fits your needs. One of these focuses mainly on managing logistic flows and the other on execution. The first type is used by shippers when assembling loads, organizing bid processes, outsourcing of transports and selecting carriers. The other option is often used by transporters during loading / unloading, documenting and for example, management of costs.
Good TMS software is open and accessible for external systems so that clients and suppliers can be connected. Integration with existing or future systems are key. Select vendors that have the skills to integrate quickly. Focus on open architecture that supports multiple formats like XML, EDI, API's and web services. Keep in mind that carriers for example are not equipped to handle many different interfacing set-ups and have limited IT resources.
Be sure to look for web-based software as it is gaining popularity. The investment costs are often less and the investment time is smaller. In addition, the implementation time is much shorter (1-3 months). The market needs innovation and advanced technology, but at the same time it also wants to keep costs under control. A more of a trend in the market is TMS software as a service. (SAAS model)
TMS suppliers are not the only ones to offer transportation solutions in the market. TMS software that focus on one mode and lack optimization capabilities, may be suitable for shippers that don’t have complex requirements. Logistics Service Providers (LSP) provide managed transportation services to the market; basically, they use their own TMS solution.
Especially for smaller sized shippers (SMB segment) there is a hugh growth in TMS usage as the market came out with cheaper solutions. Some companies offer their software for free or for a very small yearly fee. With a Saas model, deploying a TMS system is not so complicated anymore and less time consuming. No barriers anymore to bring TMS to your company. On the other hand the level of support is not so intensive as an inhouse application. And not only during implementation but also after (post-implementation support)
Today’s more capable TMS solutions offer a strong ROI if they match your company demands.
Understand the features of the pre-selected TMS software and see how it can be relevant for your business. Ask for demos and walk throughs to find out everything you need to know.
Understand that the more universal a system, the more complex usage you will face
Overall if you do it the right way it creates efficiency, improve productivity, save money and provide premium levels of customer service
If you want to maximize the value out of a TMS contact our TMS consultancy service or download our free “Unlocking the value of TMS” guide (link).
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