What Is Transportation Modeling

MercuryGate Blog - TMS Category

Imagine an efficient warehouse and retailer. The organization seamlessly fulfills orders. Carriers arrive on time, every time, and customers write the best reviews because the button for bad reviews is broken. While that might sound like a dream, it is possible to peer into the future of the supply chain and see what needs to happen to guarantee the customer is always right, the carriers arrive on time, recognize when it’s going to be time for replenishment before the shelves even look half-empty, and address the potential concerns of customers. While this may seem like an ambitious undertaking for supply chain management, the concept is actually not new—transportation modeling. Modern transportation modeling takes the “what ifs” and finds out what might happen, what should happen, what can be achieved to avoid the problems, and what an organization must do to compete and reach their stated goals for the supply chain. Modeling is the supply chain’s other-worldly medium and demand-planning function, and shippers need to understand its value.

Challenges of Managing Global Logistics

The challenges of managing global logistics are increasingly complex. Known and unknown disruptions will occur and modern companies are so interdependent that they feel a loss of autonomy. At any given time, the supply chain can be seen as a fragile entity that could be just shy of a collapse — whether total or partial., And, as organizations continually battle supply chain risk and disruption, shareholders remain vocal about lowering costs, increasing services, and doing more with less. As explained by Chad Crotty of Inbound Logistics:

“Cutting transportation costs makes the top of the list as far as concerns for the logistics industry. Some other obvious pain points make the list as well, but perhaps the most important—and at times, challenging—concern is the need for greater innovations and technology advances while remaining budget-conscious.”
Other challenges remain, including the need for business process improvement, better customer service, improved trucker wages and retention, compliance with new government regulations, such as the IMO 2020 standard, and technological innovations. The list is continuously changing, and customer expectations only continue to grow. Unfortunately, the complexity of appealing to a global customer base, not to mention business-to-business partners, forces supply chain leaders to start thinking outside the box and looking for ways to save money before freight ever leaves the door. This is where transportation modeling makes a huge splash in the global supply chain pond.

Transportation Modeling Gives Shippers an Opportunity to Proactively Plan Shipping

Transportation modeling enables ongoing, comprehensive transport network planning through the ability to collect, analyze, and apply data across the scope of the supply chain to optimize operations. TMS users of such systems gain the ability to test endless “what-if” scenarios relating to profitability, auditing, customer service, last-mile delivery, failures with carrier performance, and more. It provides the means of finding the best path forward and deriving the best possible rates and the best service opportunities at the same time.

Tips to Improve Transportation Modeling

Since transportation modeling is an ongoing analysis of information, shippers and logistics service professionals need to follow a few tips:
  1. Get your supply chain partners on board with using the same systems as your company, focusing on easy-to-onboard systems.
  2. Avoid disparate data siloes by leveraging APIs to connect to a centralized, SaaS-TMS.
  3. Use robotic process automation to continuously self-optimize configurations and settings for your warehouse, loading dock, carrier pool, and more.
  4. Take back autonomy by leveraging carrier, vendor, and supplier portals (depending on your role in the supply chain) and managing your responsibilities.
  5. Access data across multiple devices, using a mobile-capable TMS, eliminating the concern over remote management.
  6. Look at everything at once, rating all modes, rating all lanes, rating all carriers, ratings’ comparisons to major freight rate indices, and more.

Increase the Accuracy of Your Forecasts With Advanced, Data-Driven Modeling

Stop guessing and know what will happen in all your wildest and most unimaginable supply chain dreams with transportation modeling.

Get started on your vision of the future by requesting a MercuryGate demo today.

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4 Responses

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  2. Simply wish to say your article is as amazing.
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