Supply Chain Optimization
Why a Modern TMS is the Need of the Hour for Supply Chain Businesses
Sep 9, 2021
5 mins read
Modern supply chains are complex and ever-evolving. From the point of sourcing or manufacture to the point of end consumption, there are a number of touchpoints and several different factors to consider when planning logistical activities.
When managing a small-scale business operating within a limited radius, it may be possible to plan and execute delivery logistics manually or with the help of basic spreadsheets and mapping tools. But as your business grows and expands, you need a robust Transport Management System (TMS) platform for optimal management of disparate logistical processes. Especially in times of lurking uncertainties, the importance of having a solid TMS to build a responsive, resilient and adaptable supply chain cannot be overlooked.
A Transport Management System or TMS is a cohesive technology that helps businesses plan, execute, and optimize the physical movement of goods throughout the supply chain, including forward and reverse movement across multiple locations, while saving manual efforts and bringing down transportation costs. According to Gartner, TMS is a technology used to plan freight movements, do freight rating and shopping, select appropriate routes and carriers for transportation, and manage freight bills and payments.
But beyond these, a TMS performs several other functions to streamline logistics management for a business. Some key TMS features include:
- Supply chain network management for a smooth flow of goods across all touchpoints
- Shipment scheduling and order dispatching
- Carrier selection and fleet capacity management
- Tracking and monitoring of shipments through the supply chain
- Overall freight cost management
- Transport and supply chain data management
- Analytics and insights for improved decision making
In a nutshell, a TMS is an oil that enables the smooth functioning of a supply chain engine from end to end. Most businesses realize the importance of a TMS in building a strong and resilient supply chain and already have a system in place to handle their logistics needs. So, why are we talking about it now?
Traditional TMS solutions might be helpful in managing logistics to a certain extent, but these solutions are often bulky, implemented on-premise, and lack the competency to deal with modern supply chain challenges.
The pandemic has caused massive disruptions in supply chains across the globe, redefining market dynamics and creating a surge in demand for greater speed, visibility, quality, and consistency. Same-day and next-day deliveries have become the new normal, and delivery efficiency is a key to customer satisfaction. At the same time, competition in retail, e-commerce, home services, and delivery space is rapidly growing.
These evolving customer demands and rising market competition is pushing enterprises to level up their logistics management to keep customers satisfied and stand out in the market. Old-school TMS solutions are not optimal enough in handling on-demand expectations or agile enough to scale up or down logistical planning as per market fluctuations.
Businesses need a modern Transport Management System that can efficiently take care of logistics planning, execution, and management while building long-term resilience to solve these modern-world supply chain challenges. Software as a Service TMS solutions are now gaining popularity among supply chain businesses to build efficiency and greater responsiveness.
Check Out: The Definitive Guide to Transport Management System
Cloud-based and easy to implement
SaaS TMS solutions are Cloud-driven and easy to implement compared to on-premise TMS software. As these solutions run on Cloud, they can be implemented anywhere with internet connectivity and require no initial investment in equipment. Also, you can subscribe to these solutions on a pay-per-user or pay-per-month basis, making it an economical option for all business sizes.
Scalable and flexible
The logistics requirements of a business keep changing with time and must be managed well in real-time. Modern TMS solutions are customizable to suit specific business needs and can be scaled up or down easily with time. For instance, businesses need additional fleet vehicles and more storage capacities during peak seasons to meet the demand surge. A smart TMS solution predicts such requirements and plans warehousing and fleet operations to meet the changing requirements.
Data-driven decision making
Data is a super-power for supply chains, but most businesses fail to make the most of this abundantly available data for their benefit. Modern TMS solutions are backed with data science algorithms that can capture readily available business information—customer expectations, market trends, competitor moves, on-ground data, etc. to better plan logistics and delivery operations. Effective data analytics also allows businesses to come up with personalized offerings to enhance customer delight.
Automated logistics planning
Logistics managers usually spend hours planning day-to-day logistics activities. Manual planning is both inefficient and time-consuming. With the help of AI-enabled TMS solutions, you can not only manage transportation but also automatically plan dynamic orders, dispatches, and delivery routes effectively. Automated planning improves accuracy and reduces human dependency in the supply chain.
Advanced routing capabilities
New-age TMS solutions have advanced route planning capabilities powered by location intelligence. Geocoding tools map physical addresses accurately on a virtual map, making delivery operations more efficient. AI-driven route planning software plans the most optimal delivery routes for hundreds of locations, considering real-world constraints like traffic and weather conditions, rider preferences, customer-preferred timelines, and more.
Complete supply chain visibility
Achieving clarity and visibility in logistics is still a challenge for many supply chain businesses. With a solid TMS in place, you can gain complete visibility of on-ground deliveries, vehicles in transit, and rider performance. Logistics managers can monitor logistics effectively and can also share live order updates and ETAs with customers.
Today, Software as a Service (SaaS) solutions are revolutionizing logistics management with data science, Artificial Intelligence, and Machine Learning algorithms. If you’re planning to invest in a solid TMS software or upgrade your existing TMS, consider switching to a modern TMS SaaS for your enterprise, and streamline your supply chain logistics.
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ABOUT THE AUTHOR
Shweta is a seasoned business author and writes about logistics, supply chain management, and SaaS technologies. She occasionally writes on Quora and loves to take on baking experiments in her free time.Read other blogs by this author
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Why a Modern TMS is the Need of the Hour for Supply Chain Businesses