Inbound Logistics | May 2023

N early every shipper of any size currently uses some form of transportation management system (TMS). But not all TMS solutions are the same.

for include the ability to plan, execute, manage, settle, monitor, and model, whether you are a shipper, a third-party logistics (3PL) provider, or a carrier. “A TMS enables the transparency and visibility required in today’s world of complex ecommerce and global supply chains,” Romano says. LOWER COSTS Thanks to advances such as cloud- based Software-as-a-Service (SaaS) computing, modern TMS solutions deliver powerful functionality at a lower cost than previous technology, opening the door for different service models that allow a wide range of companies to take advantage of their benets. For example, the needs of a small domestic shipper are much different than a multi-national company. “The size and scale of your network will determine the size and scale of the TMS you need,” says Bryant Smith, director of product management for TMS at supply chain software supplier Manhattan Associates. “If you have a small network with a small footprint, you probably don’t need an enterprise-level TMS that handles domestic, international, and multimodal transportation,” he adds.

Perhaps you use legacy spreadsheets that break if a formula is updated. Or maybe your organization invested heavily in an on-premises solution 10 years ago, but technology and your business have left it behind. Or you’ve engaged with a third-party logistics provider that offers its own TMS solution as part of its services but you wonder what other options are available. Given ongoing capacity constraints, multiplying distribution channels, and increasingly complex and volatile supply chains, organizations are looking for a better way to keep products moving at the right price at the right time. An outdated or inadequate TMS can stunt a company’s growth through higher costs and failure to meet customer expectations for delivery times and real-time tracking information. “If your TMS is not providing the same level of support at each phase of your business growth, then it is time to look for an option that

can support day-to-day operations while being exible enough to support growing demand,” says Jeff McDermott, executive vice president of transportation management for GEODIS, a logistics services provider. WHAT IS A TMS? The right TMS can help companies reduce transportation costs and improve customer service by automating everyday tasks and connecting with the larger transportation ecosystem. At the base level, a TMS is a logistics technology platform that helps business plan, manage, and optimize the physical movement of inbound and outbound goods. Overall, a TMS can deliver savings of 5 to 15% from optimized lanes and modes compared to the market, says R.J. Romano, supply chain advisory practice leader for consulting rm BDO USA. With so many TMS options on the market, the key functionalities to look

This zoomed-in version of Manhattan Associates' TMS platform demonstrates the visibility that a TMS solution can provide on the status of inbound and outbound shipments.

May 2023 • Inbound Logistics 49

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