May 2010 | Sponsored | Knowledge Base

TMS Evolved: Intelligent Execution Tools That Add Context

Tags: Transportation Management Systems (TMS)

Steven Shoemaker is Owner, RateLinx, 262-565-6150

Evolution is inevitable, isn't it? It makes sense that transportation management systems should evolve as well. While the concept of Moore's Law does not necessarily apply to TMS advancements in its short lifespan, there are current improvements available that are making shippers stand up and take notice.

The newest improvement has been the ability to add context to a shipper's transportation data through a TMS that is aware of the various pieces that make up their supply chain solution.

Context allows the shipper to understand the actual circumstances that led to a particular event in their supply chain:

  • Incorrect invoice charge from their carrier—was this caused by the carrier re-weighing their freight, re-classifying their freight, a particular accessorial charge, etc.?
  • Why was the shipment late? Was this caused by inclement weather, did the carrier leave the shipment at their terminal, was the consignee not available for delivery, etc.?
  • Inbound freight—when was the shipper's purchase order fulfilled by their vendor? Which carrier is going to be delivering it—and when? Which purchase orders have been fulfilled? Were they fulfilled completely?

Many consider a traditional TMS as simply expensive load planning software, when it can be so much more. While there are quite a few options from different TMS providers available today, it may be time to evaluate a TMS system by how "aware" it is of the entire supply chain. The following advancements in TMS are emerging, allowing TMS to become aware of the entire supply chain:

  • Freight Execution—Utilization of a single system that can tender shipments via all modes, thus eliminating the need for bolt-on applications for modes (such as small parcel), allowing the shipper to integrate with their host system with one system, ensuring that the same information is being pulled from the host system and is available in the same format for each and every mode. Also, any and all additional documentation required to tender shipments, i.e. small parcel labels, less-than-truckload and/or truckload bills of lading, pallet labels, hazardous and international documentation, etc. should print at the point of shipment at this stage of the game.
  • Freight Payment and Pre-Audit—Matching information from the execution tool above to the invoice from the carrier ensures a more thorough audit—by auditing the characteristics of the invoice along with the corresponding charges of each shipment.
  • Visibility and Communication—Providing the shipper's vendors with an execution tool that has the shipper's business rules, carriers, and their purchase orders pre-loaded. The shipper's vendors then can tender shipments to the shipper's carriers based on the PO number, which removes the shipper's dependency on the carrier to provide shipper with this critical information.
  • Dashboards—Most importantly, there is now the capability of tying together all of the aforementioned data into an all-encompassing Dashboard to help shippers effectively manage their company's freight activity—real time—giving true context by providing visibility to the data that is flowing in from the TMS, the Freight Payment and Pre-audit, from all of their shipping locations. The best dashboards are real-time, and have each component listed above literally "aware" of all of these pieces, instantly supplying information that is compiled and incorporated into the shipper's Key Performance Indicators for logistics—specifically utilizing their own corporate KPI's and specific business rules. This also enables proper measurement and management of both the Freight Payment and Pre-Audit to match the data that is flowing into it, along with providing visibility to the characteristics of each freight transaction.

What do these advancements really mean to the shipper? This finally allows the shipper to determine the meaning of the events occurring in their supply chain in a real-time fashion. Two examples:

  • A shipper provides a program for their customers where they receive free freight on orders for particular products. Until they had the proper context, they were unable to quantify exactly how much freight they were giving away, and were unable to leverage this in their marketing campaign to their customers.
  • A shipper was having problems with their vendors fulfilling their PO's in a timely manner. The freight was being shipped directly to job sites, and the lack of visibility and coordination with the vendor was causing job sites to be shut down because the freight was not showing up when expected—only to find out that it arrived sometimes a few minutes after the job site was vacated.

The evolution of the TMS continues...Darwin maintained that all forms of life are interconnected and related, although nobody is certain that PO visibility, vendor compliancy, or freight auditing were on his mind when considering Natural Selection.