By Kirk Graves | Senior Manager Transportation | Chainalytics
There are many compelling reasons for a company to invest in a new TMS. The reasons vary from business to business but most often, they’re a mix including a need for:
- Transportation cost savings, achieved by optimization, consolidation and improved mode selection
- Shipment visibility and alerting, for tighter inventory control and production scheduling
- Automate freight audit and payment, to reduce overhead and outsourcing costs
- Better transportation spend visibility, to improve freight spend forecasting
- Advanced analytics, for a better understanding of freight spend down to the item level
- Headcount reduction in the transportation department by automating functions like tendering
3 Steps to Get You to the Right TMS
Before you get started on selecting and implementing your TMS, realize that success takes time and preparation. With all the features and modules available in today’s TMS’s how do you know which requirements to prioritize? Here’s the guidance we provide for clients approaching this important business decision:
- Understand your current transportation capabilities. Before you even engage TMS providers in a discussion, take the time to understand what you currently do as a business. Map out your current processes in all critical areas, such as inbound planning, outbound planning, freight payment, tracking and tracing. Insight into the details of your day-to-day activities will help you focus on areas that are “must haves” in your new TMS. Learning the strengths and weaknesses of your organization is important when it comes time to implement your TMS, to ensure you align your processes with the TMS’s functionality.
- Formulate a vision for the future. Your transportation, freight, logistics and planning co-workers, from planners to senior leadership, typically have ideas for making transportation better. Elicit and examine each of these ideas to determine which ones make sense for your business. Then use these ideas to create a vision and goals for what a new TMS will bring to your organization.
- Create a set of business requirements to present to each TMS vendor you approach. During your evaluation process, focus on a few key requirements that you feel are going to be differentiators for your business and ensure your TMS vendors focus on them, as well. Also keep mind: It’s important for each vendor to demo their product using your data, to ensure your new TMS will meet your requirements. This process will help reveal each TMS’s strengths and weaknesses, as they relate to your business. A scoring system is often helpful in evaluating each vendor’s offering. Once you make your selection, align your key requirements with the strengths of your new TMS, to help create an implementation plan that brings value early in the process and sets you up for future success.
We’ve been through many TMS selections with Chainalytics’ clients and I can say from experience: The simple methodology above has a proven track record of helping them achieve their business and logistics goals, whether they are a small shipper with limited national footprint seeking a simpler EDI-based service model or a global 3PL using APIs and extensive cloud-hosted data to move millions of dollars of freight. As far as our clients are concerned? This methodology has helped them go the extra mile to make the right choice for their company. Read more about Chainalytics’ TMS expertise:
- (BLOG) TMS ROI: Five Pitfalls that Will Drive You Mad
- (BLOG) What to Do if It’s Really Time to Migrate Off Your TMS
Kirk Graves is a senior manager in Chainalytics’ Transportation competency, where he helps clients select the best TMS solution to meet their current goals and future growth. His experience includes evaluating transportation operations and systems to access current practices and providing recommendations on process and system improvements in addition to ‘best practice” recommendations.