3 Components to an Effective Transportation Management System

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Editor's Note: This post was edited with updated content in July 2020.

When we hear "transportation management system" at LeanCor, we don't just think of software. We think of the people, processes, and technology that work as a whole to effectively move materials and information. Maturing these three components can help shippers develop and maintain a fast, stable, efficient transportation management system.

Taken from our Transportation Management Maturity Self-Assessment, below are best practices in people, processes, and technology that are benchmarks for competitive advantage amidst today's constant industry disruption.

Are these practices part of your organization's transportation management system?

People

While autonomous technology is making incredible advances, excellence in a transportation management still depends on humans as a valuable asset of the overall system. Coaching, collaboration, relationship building, problem solving and learning are all activities that help today's organizations thrive. These things must happen with both external vendors and internal teams in order to improve the system as a whole.

  • We have knowledgeable and disciplined logistics professionals on our transportation team.
  • Our teams understand market trends in the industry and use them to drive decision making.
  • Our transportation team collaborates with different internal departments to achieve overall company goals.
  • We collaborate with and develop suppliers so that they will adequately fulfill order instructions to meet our production requirements.
  • We have strategic, long-term relationships with a mix of asset-based carriers and brokers that are aligned with our company’s expectations and help meet our business goals.

Process

Transportation processes need to be managed with the same rigor as any other important business function. Lean principles such as standardization, waste reduction and visibility all help to make processes stronger and drive better customer value. At LeanCor, we recommend starting the day with a transportation plan, executing to that plan, and then checking actual condition to that plan. Any waste that exists should be continually driven out with formal problem solving. Below are standard processes we practice across all customer accounts for mature and effective transportation management systems:

  • We engineer pre-determined, repeatable route plans for our inbound networks.
  • We engineer pre-determined, repeatable route plans for our outbound networks.
  • We re-adjust our route plans on a daily basis to gain efficiencies.
  • We adjust our route plans based on seasonality factors.
  • We have a Plan for Every Part (PFEP).
  • We measure our trailer cube utilization and perform trailer audits.
  • We consolidate shipments to increase trailer cube utilization (mode optimization).
  • We start with customer demand and consider overall value when sourcing carriers, instead of transportation rates alone.
  • We know how our carriers are performing relative to service (i.e. on-time pick-up/delivery, communication, fall-outs, etc.).
  • Our carrier bids ensure we always have the right carrier and rate for each load.
  • We leverage inbound and outbound transportation as one network.
  • Our transportation management strategy is part of our end-to-end supply chain strategy.

Technology

Transportation Management Systems TMS continue to offer a strong ROI for shippers, and that trend shows no signs of slowing down any time soon. From optimizing routes to changing the way a business handles its freight auditing, a strategic TMS can be a solution to many transportation problems. Technology should serve to support process discipline – in other words, create the optimal process, then automate them with technology. 

Whether you need simple plug-and-play software or a full-service partner, consider a solution that goes beyond "good enough for now" to truly advancing your supply chain -- and ultimately, your business.

  • Our Transportation Management System (TMS) can notify us of an incomplete shipment and available recovery options before delivery.
  • We issue web-based advanced shipping notices (ASN) to our customers.
  • We receive web-based ASN’s from our supply base.
  • We track shipments in a way that provides real-time visibility to our freight at all times.
  • We have established measurement systems that drive daily continuous improvement in our transportation management.
  • Our TMS facilitates real-time, exceptions-based communication.
  • Our TMS easily integrates with our other systems.

 

 

Posted by LeanCor Supply Chain Group

blog author

We Teach. We Consult. We Do. LeanCor is a strategic supply chain partner that provides third party logistics, supply chain consulting, and corporate training programs. These three, integrated solutions – LeanCor Logistics, LeanCor Consulting, and LeanCor Training and Education – specialize in lean principles to help businesses better serve their customers by eliminating waste, decreasing costs, and building cultures of continuous improvement.

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