Q&A: How Using a TMS Can Help You Become a Better Shipper
Do you view your supply chain as a cost center rather than a competitive advantage?
Are you up to your neck in spreadsheets and emails trying to run your supply chain operations?
Is your company’s supply chain data stored in multiple systems spread-out amongst multiple third-party logistics (3PL) providers?
Shippers in today’s truckload market are faced with numerous, daily challenges when it comes to running their logistic operations. Securing capacity, timely billing and accurate tracking are just a few of the many considerations on the minds of shippers like you, who are looking to ensure the bottom line stays in the green. With all these considerations and the supporting data points piling up to validate each one, the question becomes…
How are you managing all this data?
Adopting a transportation management system (TMS), or working with a provider for managed TMS services, can be the make or break for any shipper seeking an advantage over their competition in the modern truckload industry. Being able to centralize and streamline reporting, forecasting and cost tracking can become a huge leg up for any facility. Not only that, a TMS – when properly leveraged – can help instill better practices by setting KPIs for service levels. However, without proper implementation, all efforts go to waste.
We sat down with Jack Gerstner, Vice President of CTM Operations, to discuss the importance of TMS solutions and how it can play a pivotal role in your supply chain operations.
Q: Why is it important for shippers to invest in a TMS?
A: In today’s digitally-driven environment, data is king. Not just data, but CLEAN data. A TMS, or managed TMS services, enables shippers to consolidate and scrub for inaccuracies in their record keeping. With clean data at your fingertips, the ability to make more informed business decisions becomes an actionable task. As I like to say, “You don’t know what you don’t measure.” Being able to have more control over your supply chain, and knowing what to measure to drive long-term success, is a powerful advantage over your competitors.
Q: What is one of the greatest advantages to having a TMS?
A: Shippers want growth in today’s marketplace and a more proactive focus on long-term success. A comprehensive transportation management system can help you achieve this objective. Tracking costs and related service levels is vital to any shipper who wants to turn their department from a cost center to a competitive, revenue-generating advantage. The ability to calculate costs to forecast against potential growth is a key differentiator for growing shippers, especially for those looking to become the next enterprise giant.
Q: From a capability standpoint, what does a TMS allow shippers to do with collected data?
A: No one can predict the future, but you can certainly make sound business decisions with a plentiful source of information at your disposal. Leveraging leading and lagging indicators to bring your operations into a more predictable environment – as it pertains to volume, spend and service – is a big step in the right direction. More accurate forecasts and expectation setting from a budgeting perspective becomes real with clean, centralized data. A TMS enables you to provide better data to your carrier suppliers so they, in turn, can allocate capacity in a more cost-effective and service-enhancing fashion. Lastly, it allows you to hold your suppliers and internal stakeholders accountable for performance.
For more information on the capabilities of a comprehensive TMS, download our guide "From Investing in Data to Relationships: Actionable Tips for Becoming a Shipper of Choice."
Q: What metrics can a comprehensive TMS report on to help improve supply chain performance?
A: I could go on and on about reporting, but a few key ones that come to mind are:
- Service (root cause analysis)
- Cost per unit
- Your supply chain vs. the overall market
- Your supply chain vs. industry peers
Q: How can a management system help with carrier relationships?
A: Bridging the gap between shippers and carriers can always prove to be a daunting task, but with a TMS in place expectation-setting becomes a more pleasant conversation. With reports on performance, volume and other tangible indicators you can proactively plan with your carriers for the market spikes and lulls throughout the year. Furthermore, a TMS enables efficiency and automation, making it easier than ever to become a preferred shipper, or a “shipper of choice.” Lastly, effective communication and accountability becomes attainable with a centralized platform put in place.
Q: What challenges come with implementing a TMS?
A: Ever hear this before? “But we’ve always done it this way!” Internal change management can be difficult for certain organizations. The key is to have an open mind to change and think about how adoption can make things exponentially better in the future.
Also, if a TMS implementation has failed in the past, the willingness among leadership to try again may be sluggish. If the upfront investment isn’t scary enough to take on again, then the resources required to invest in a successful implementation – including rolling out associated training – could be enough to scare some folks away. But have you asked yourself, “Is there a better way to manage our supply chain, and if so, how can I get my team on board with committing to the investment?”.
Q: How can I get started?
A: There are a lot of TMS offerings on the market now. The best thing to do is research providers and engage with them in a full-blown RFP process to understand their capabilities, and just as critical – their expert support.
But if you want to save yourself time and headaches, talk with Coyote’s dedicated team about managed supply chain solutions available through our innovative and experienced Collaborative Transportation Management (CTM) team. Not only is our platform capable of providing complete network visibility and reporting, but our Operations team provides both daily tactical operations and support, as well as long-term strategic guidance.
To learn more about Coyote’s customer-focused approach to logistics technology, read our article “How Your Needs Drive Innovation in Supply Chain Technology.”
To start talking with Coyote’s Operations team about your TMS needs, click here.
To learn even more about becoming a preferred shipper in this competitive and changing market, read our full Shipper of Choice guidebook.