Bench Talk

Future-proofing Transportation Management System Design with Cloud-Based Software

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The COVID-19 pandemic disrupted routine business operations in several ways, but perhaps the most memorable was the strain it placed on supply chains for a number of consumer commodities. An efficient transportation management system (TMS), which helps plan and execute the shipment of goods, would not have prevented the Great Toilet Paper Shortage of 2020, but it might have made the problems more traceable and, therefore, more transparent.

While traditional TMS systems have been housed on-premise, there's increasing momentum to move its operations to the cloud. The speed of business demands agility, which cloud-based TMS delivered as software-as-a-service (SaaS) packages usually provide.

A TMS is a significant, but only one, component of a supply chain management (SCM) system. The other two pillars include enterprise resource planning (ERP) and warehouse management systems (WMS). The three together ensure all workflow tasks related to orders and inventory are managed smoothly.

The ERP, for example, takes care of order and inventory management and accounting and invoicing protocols. Once orders come in, the WMS attends to fulfilling them and also manages the flow of other goods in the warehouse. Finally, the TMS helps pick the suitable carrier and delivery method for optimal cost and speed of shipment. While the process might sound simple, the choices in each step might involve hundreds of options, especially in large enterprises. So, many business considerations go into choosing and operating a TMS.

The global supply chain has been under intense pressure to ensure smooth operations and facilitate commerce without disruptions. Fortunately, aided by technology, many factors are merging to make every link in the supply chain more transparent.

Blame it on the Amazon effect. Consumers want their packages faster and often want to be able to track them in real time. The trend is also migrating to business-to-business transactions. But such efficiencies in the last mile of shipping need more relevant information that can be easily shared and visualized.

The Internet of Things (IoT) and its industrial equivalent have enabled sensors for more efficiencies in transport management systems and the larger supply chain. Sensors can measure and report the temperature of foods and vaccines, for example, in cold supply chains. Computer vision and artificial intelligence process information from barcodes more precisely and deliver sharper insights and real-time tracking.

Both shippers and other stakeholders up and down the supply chain, especially in the last mile, need to access updated and real-time information wherever they are conducting business, whether on the road or elsewhere.

To avoid, or at least lessen the impact of, of large-scale disruptions, we will need both large and small changes throughout. The TMS will also need to be able to process and display the continual stream of insights from advanced technologies.

The many process improvements enabled by technology need a modern TMS to best leverage the advantages. The reasons to switch to a cloud-based software system for transportation management are very similar to why one would switch to the cloud for most other software.

Cloud-based SaaS is usually able to grant authorized users access on the road and through proprietary mobile apps. Such ready availability improves worker productivity as they don't need to be at one particular location to gain insights into the global movement of all packages.

Accessing information on the road also enables TMS users to be continually connected with all relevant decision-makers—from carriers and suppliers to customers. Users can also rest assured that they are working with the latest software version that garners insights from advanced technologies and delivers them in one integrated platform. A cloud-based TMS will also ensure the latest security updates are integrated into the workflows.

One of the strongest advantages of a cloud-based SaaS is its ability to scale up and down as needed with business needs. Too often, on-premise IT infrastructure gets outdated quickly, and the care and maintenance of the equipment and related software adds to already steep capital expenditures. Cloud-based TMS enables enterprises to use as many software licenses as needed and adds to operating expenses instead of bulking CAPEX.

The global supply chain has seen many hiccups in recent years, which often adversely affect consumers. When there are thousands of carriers and packages to ship and track, enterprises need cutting-edge TMS that will help them save time and money while keeping customers happy. The TMS might be only one component of a larger supply chain management system, but a cloud-based one helps companies tackle the many complexities smoothly while leveraging the latest advanced technologies for continual process improvements.