Transportation management solutions and metrics, built on solid analytics, help shippers keep up with ever-changing volatility in today’s market. With e-commerce, digital supply chain, automation, and many other technological advances dominating the transportation industry, freight transportation processes are evolving.
“Challenged by rising freight rates, driver shortages, tight truck capacity, and changing customer demands, shippers are using more technology to work through these and other transportation-centric problems,” according to Logistics Management. “As the true workhorses of the supply chain management software cluster, transportation management systems (TMS) have become the “must-have” for companies.”
Here are key things shippers need to consider when building planning metrics and utilizing a fully integrated transportation management platform.
Where Shippers Go Wrong in Building Planning Metrics
- Poor management of resources leads to excessive fees and expenses, as well as missed opportunities.
- Legacy transportation management platforms struggle to keep up with the automation and digitization that governs the market today.
- Outdated management practices limit transportation managers’ ability to access information across their network.
- And a lack of accurate and reliable data for freight transportation services makes it challenging to plan.
Ways a Transport Management System Enables Better Throughput
An up-to-date transport management system makes it easier to increase throughput and boost productivity across the supply chain.
A transportation management solution allows for easier processing and management of all critical shipping services. Everything from route planning to carrier selection, load optimization, and supply chain integration is made more accessible and practical without the manual inefficiencies and errors plaguing many companies today.
What Are the Top Supply Chain Planning Metrics?
Transportation management solutions benefit from a focus on the following metrics with overall logistics in mind:
- Cash-to-cash cycle time reveals how long it takes to convert resources into cash flow.
- The perfect order rate compares total orders and those delivered on time.
- Fill rate is the metric that shows how many orders were filled on the first shipment.
- Customer order cycle time is the time between orders placed and received.
- Inventory day of supplies offers insight into inventory flow throughout the company.
- Inventory turnover sheds light on how much extended inventory is held before shipping out.
- Reasons for return reveal trends about why customers return shipments.
- On-time delivery shows, thanks to real-time tracking tools, orders that are delivered on time.
- On-time shipment designates how many orders shipped out on time.
- Costs as a percentage of sales help shippers see the value and ROI of services.
Boost Shipment Planning Performance With the Right Transportation Management Platform
The lack of actionability, scalability, and flexibility of older transport management systems slows down growth and expansion. And poor collaboration in supply chains leads to an overall inability to execute essential functions without extensive time and money losses.