On the road to optimised transport management thanks to IT TMS
What is a TMS?
" Transportation Management System " refers to software designed to manage the transport of goods. And in a globalised and demanding economic ecosystem, where the challenges surrounding logistics are multiplying, it's easy to see why this type of system is of increasing interest to companies looking to improve efficiency.
Is the TMS right for you?
Definition, benefits, features... today we focus on this magical tool that will make your supply chain a real value driver 🤩.
What is a computerised TMS?
TMS software: definition
TMS, an acronym for Transportation Management System, defines a type of software that supports companies in organising their logistics, i.e. the movement of their incoming and outgoing goods.
Basically, it helps to plan, optimise and monitor transport operations.
There are two categories of TMS:
- TMS for shippers: in this case, transport is not the company's core business, even if it does have to ship and/or receive large quantities of products. It therefore uses the tool to improve its logistics processes;
- carrier TMSs: we are dealing with organisations more focused on transport (road haulage, delivery companies, etc.), which provide other professionals with services in this area.
💡 The IT TMS can be integrated more globally into a supply chain management platform.
How does the TMS work?
Obviously, each solution has its own specific features, adapted to its target market.
However, it can be said that the overall operation of a TMS is as follows:
- Gathering information: the software starts by gathering all the key data, such as customer orders, available stocks, warehouse locations, information on available carriers, and so on.
- Planning shipping modes and routes: using this data, the TMS selects the most suitable mode of transport and draws up routes, taking into account factors such as distance, estimated journey time, transport costs and regulatory constraints.
- Vehicle allocation: it then allocates the appropriate vehicles and drivers according to the above criteria.
- Real-time monitoring : the GPS systems integrated into TMSs enable real-time monitoring of transport progress. As a result, companies are able to react quickly in the event of a problem.
- Document management: most Transport Management Systems manage the documentation associated with shipments, particularly delivery notes.
Why use a TMS? The 4 key benefits
#1 Increased efficiency
Managing transport is often a complex task, especially in a globalised economy. Not to mention the fact that consumers are becoming increasingly demanding when it comes to the time it takes to receive their orders.
A computerised TMS streamlines the entire process to improve efficiency and customer satisfaction.
What's more, this gain in efficiency (route optimisation, for example) has a positive impact on costs 🤑 !
# 2 Greater visibility
Where there's complexity in the supply chain, there's also a lack of visibility to coordinate operations and spot anomalies as early as possible.
Thanks to TMS software, you'll be aware in real time of what's happening with your goods transport (tracking shipments, routes, detecting any delays, etc.), and take the right decisions more quickly.
#3 Better decision-making
Another major advantage of TMSs is that they help companies to be part of a continuous improvement process.
In fact, this software generally includes analytical tools designed to measure performance and identify trends.
In other words, thanks to Transport Management Systems, you have reliable information with which to optimise your procedures.
#4 Compliance with current regulations
Last but not least, the IT TMS makes it easier to comply with the various regulations, by integrating the many constraints linked to transport, such as those relating to drivers' hours.
The software also makes it easier to comply with the company's commercial policies, taking into account pricing, delivery and order processing rules.
In short, thanks to the Transport Management System, you can avoid costly mistakes!
Who uses computerised TMSs?
Computerised TMSs are used by companies that need to receive and dispatch goods on a regular basis.
Examples include :
- manufacturers and industrial companies
- distributors and retailers
- e-commerce companies
- transport companies
- logistics service providers.
☝️ And even small organisations are now using TMSs! Thanks to the development of a more accessible cloud-based offering, they too can benefit from the many advantages promised by these platforms.
Key TMS functionalities
As we have seen, TMS functionalities vary from one solution to another. But here are the main ones 👉.
Transport planning
First and foremost, a TMS is very useful for planning the shipment of your goods.
To do this, all you have to do is select the most suitable of several carriers, taking into account various criteria:
- costs
- lead times
- routes
- quality of service
- regulatory constraints
- safety, etc.
Real-time tracking
With the GPS tracking function, you can keep an eye in real time on the position of your vehicles, their speed, stops and any delays.
In short, you get complete visibility of the progress of your shipments.
Load management
Another key TMS functionality is vehicle load optimisation.
More specifically, the software maximises their capacity while respecting weight and volume limits. In particular, it takes into account the dimensions and characteristics of the goods to be transported.
Order management
The TMS can also manage the entire order process, from collection to preparation for dispatch, with a view to reducing transport costs.
Documentation and invoicing
Most Transport Management Systems are capable of automatically generating documents, such as delivery notes and invoices, based on the data for each shipment.
Dashboards and analyses
Finally, let's not forget that the TMS is not just a simple management tool: it's also a powerful strategic tool!
That's why it often includes dashboards and other reports, providing a complete overview of your supply chain's performance.
In this way, you can pinpoint any shortcomings, and therefore the processes you need to improve (remember, the TMS helps you to be part of a continuous improvement process!).
How do you choose your TMS software?
TMSs can exist on their own, or in the form of a module integrated into a more global software package, in particular ERP (Enterprise Resource Planning) and WMS (Warehouse Management System).
In all cases, a number of criteria need to be observed when choosing the most appropriate tool.
Let's take a closer look at the questions you need to ask yourself 👉.
What do you really need?
As we have seen, TMSs offer fairly varied functional coverage.
So it's important to identify in advance the procedures you want to automate, in order to draw up a list of all the essential functions.
☝️ You can also opt for a solution that has been developed specifically for your business. For example, if you operate in the pharmaceutical or food sectors, your TMS needs to take account of cold chain constraints.
Cloud or not cloud?
As with any software, you need to ask yourself whether your TMS should be hosted in the cloud or on-premise.
Note, however, that the first option promises definite advantages:
- lower costs for deploying and hosting the tool ;
- much faster implementation of the software within the organisation;
- no updates to carry out on your own;
- an invoicing system, often in the form of a monthly subscription, that is flexible and adapts to your development.
☝️ However, some companies prefer the on-premise system. This is because it guarantees greater control over the system (including security and updates) and flexibility when it comes to aligning the TMS with specific needs.
Other criteria to look out for
- ✅ The quality of the publisher's support, both when the platform is deployed and throughout its use, particularly in the event of problems;
- ✅ The integration of the TMS with your other software (e.g. ERP), to ensure the smooth flow of data;
- ✅ Ease of use, a sine qua non for user adoption;
- ✅ The scalability of the solution, so that it can continue to manage your business effectively even if you experience strong growth;
- ✅ The return on investment promised by the TMS. The TMS must be as profitable and value-adding as possible!
👉 Example of a transport TMS:
There are many TMSs on the market and by observing all the criteria set out above, you're bound to find the one that's right for you.
One example is Shiptify, a transport and dock management solution aimed at SMEs and large groups. Shiptify is a comprehensive solution that brings together all the functions you would expect from a good TMS: Simple to deploy and use on a day-to-day basis, it goes even further by integrating dock management and warehouse appointment scheduling services.
TMS IT: in a nutshell!
Over the years, the IT TMS has become essential for any company wishing to optimise its transport management, whatever its sector of activity. Thanks to this kind of system, professionals are able to improve the efficiency of their operations, while at the same time improving customer satisfaction and cutting costs!
While these software packages offer a wide range of functions, from transport planning and load management to dashboards and analyses, each organisation needs to find the solution that suits it best. To do this, they need to sound out their needs beforehand, with a view to finding THE TMS that will take them, at speed, onto the motorway to success 🛣️.
Article translated from French