Supply chains have grown exceedingly complex, and the best-in-class transportation management systems of yesteryear are not necessarily the best systems for shippers to succeed today. Shippers that wish to stay competitive need to understand a few things about how to recognize the limitations and drawbacks of an existing system, as well as a few ways to conduct comprehensive TMS evaluation and selection.
Using a TMS is a no-brainer whether a shipper runs one truck, 1,000, or is a non-asset based shipper who relies on carrier partners to move your freight. Shippers and logistics service providers (LSPs) need an effective way to keep on top of invoicing clients, choosing the right mode of transportation with the right rate, dispatching trucks, tracking vehicles, and executing the payment. It is crucial that shippers and LSPs manage these aspects of their business wisely, and they will enjoy greater profits and a growing enterprise. Failure to do so, however, and the results can range from needless aggravation to financial bankruptcy.
Additionally, it is not that one part of a transportation management system is more important than another. If a shipper is unable to rate multiple modes or have visibility into the process of managing freight, then it’s also difficult to know if one is billed correctly. When shippers are not able to know if invoices are correct, shippers will pay more money than is necessary. If freight spend is more costly, it makes shippers less profitable. In short, not using an effective TMS will hurt sippers’ ability to compete long term. Therefore, TMS evaluation and selection is critical for shippers and LSPs to reach their desired outcomes.
Warning Signs You Need a New TMS
- Excess time waste.
- Data-driven decisions are difficult to find and apply.
- Limited scalability.
- Failure to send invoices in a timely manner or inability to audit invoices.
- Experiencing cash flow problems.
- Relying on paper and email only to manage freight.
- Spending too much time answering “Where’s my freight.”
- Inability to hold carrier partners accountable to a scorecard.
- Difficulty in taking on new business.
- Fractious vendor relations.
- A feeling of always fighting fires as exceptions are not handled in a timely manner, adding stress to the transportation department.
Conducting the TMS Evaluation
The TMS evaluation is a two-tiered process, consisting of evaluating your current system and reviewing available TMS platforms that can help your organization succeed.
- Review the problems that a new TMS must solve.
- Clearly define the scope of criteria for evaluation, including inbound freight management, supply chain risk reductions, returns management, and more.
- Consider reviewing the top features of the system, including its model, such as a traditional, terminal-based platform versus a SaaS system.
- Remember to think about integration capabilities.
- Review software vendors’ available systems and references.
- Think about upgrades and support.
- Think about how you’ll train staff to use the system.
Best Practices for Selecting and Implementing a New TMS Hassle-Free
- Create a multi-disciplinary change management team.
- Consider working with a connected TMS partner, such as MercuryGate.
- Look for a multimodal capable system.
- Invest in the system.
- Avoid unnecessary modifications.
- Purchase assistance resources, or select a support-inclusive system.
- Train your staff on how to use the system properly.
- Enable scalability with easy-to-configure workflows.