Embracing efficiency with TMS implementation

Driven by advancements in technology, globalization, and changing consumer demands, the world of logistics has evolved over the past several years, from traditional manual processes to sophisticated programs powered by automation. At the heart of this evolution lies the Transportation Management System (TMS), a tool that plays a pivotal role in modern supply chain management.

From carrier selection to shipment tracking to cost reduction strategies, a TMS is at the heart of all modern transportation operations. A TMS can improve efficiency and unlock faster turnaround times by automating manual tasks like order processing and shipment tracking. Companies can also use a TMS to optimize routes, consolidate shipments, and negotiate better rates with carriers, resulting in significant cost savings. 

Additionally, a TMS enables real-time visibility into shipment status, allowing for proactive problem-solving and quicker decision-making. This visibility allows logistics teams to make more informed decisions about transportation strategies, carrier performance, and inventory management. Companies can optimize their supply chain operations and adapt to changing market conditions more effectively with a holistic TMS. Experience these benefits firsthand and see how a TMS can transform your logistics by trying a demo today.

Planning TMS implementation

To ensure TMS success and alignment with the overall strategic objectives of the business, it is crucial that supply chain stakeholders set clear goals for implementation. The process begins with a needs assessment to determine which operational areas the TMS  should prioritize.

Businesses should begin by identifying the specific business requirements and challenges facing operations. Is it a priority to decrease costs, improve efficiency, or achieve compliance? Or perhaps boosting customer service or creating new visibility into shipment tracking is at the top of the list. Pinpointing the specific areas that inform the need to implement a TMS will help better guide its adoption and realize higher return on investment (ROI).

During the needs assessment, search for opportunities for Business Process Reengineering (BPR). Businesses often achieve cost reductions through TMS implementation, but changes to processes and work streams can create even more savings. Plus, the implementation provides a convenient window to tweak workflows before codifying and solidifying their configuration in the new TMS.

When creating a TMS implementation plan, set Key Performance Indicators (KPIs) to track specific measures of success. Work with the selected TMS vendor to customize the solution and integrate it with existing systems—such as Enterprise Resource Planning (ERP), Warehouse Management Systems (WMS), and Customer Relationship Management (CRM) platforms. And provide comprehensive training to employees using the TMS, to ensure smooth adoption and minimize resistance to change.

By following these steps, organizations can effectively align the features and functionality of the TMS with their business requirements, maximizing the value derived from the implementation and achieving their strategic objectives.

Selecting the right TMS vendor

The process of selecting the right TMS vendor is critical for the success of the implementation and the long-term effectiveness of the solution. Conduct thorough research to identify vendors that meet the defined criteria. Look for companies with a proven track record, positive customer reviews, and expertise in the transportation and logistics industry. 

Also consider the breadth of the vendor’s solution offerings, including whether they offer an on-premise TMS or a cloud-based TMS. With an on-premise TMS, your company hosts the system internally and you have complete control of your transportation services and data. With a cloud-based TMS, a third-party provider manages the system through remote servers, and you can access the TMS through an online platform. A cloud TMS can be easily customized to align with specific business objectives by removing or adding solutions, and managing access to shipment data in real time.

Evaluate how well the features of each vendor’s TMS solution align with current and future needs. Pay attention to core capabilities such as route optimization, freight management, carrier selection, real-time tracking, reporting and analytics, and compliance management. Evaluate how well the features align with current and future needs.

Preparing your team for TMS adoption

Change management helps minimize resistance to adopting new processes and technologies. Employees may be hesitant to embrace a TMS if they perceive it as something that could disrupt their familiar workflows. Effective change management strategies address these concerns, ensuring a seamless implementation process.

Proper training also ensures that employees understand how to use the TMS effectively. When employees are equipped with the necessary skills and knowledge, they are more likely to embrace the new system and utilize its features to their full potential, maximizing the return on investment. Well-trained staff can leverage the TMS to streamline transportation processes, including route planning, carrier selection, and freight management.

TMS integration and configuration

The technical aspects of TMS implementation involve configuring the system, migrating data, and integrating it with existing Warehouse Management Systems (WMS), Enterprise Resource Planning (ERP) systems, and other relevant systems.

1. Configure the TMS system:

The TMS implementation process typically begins with setting up and configuring the system according to the organization’s specific requirements. This involves defining parameters such as transportation modes, carrier preferences, shipping rules, routing guides, and user permissions.

Depending on the complexity of the organization’s transportation operations, the TMS may require customization to align with unique workflows and business rules. Customization can include creating reports, templates, and dashboards tailored to the organization’s needs.

After configuration and customization, a TMS should be tested thoroughly to ensure that it operates correctly and meets the organization’s requirements. Testing should encompass various scenarios, including different transportation modes, carrier selections, route optimizations, and exception handling.

2. Migrate data to the new TMS:

Data migration involves extracting relevant data from existing systems, such as a legacy TMS, spreadsheets, or manual records. This data may include shipment details, carrier contracts, customer information, product catalogs, and historical transportation data.

Before importing this information into a new TMS, cleanse and transform it to ensure accuracy, consistency, and compatibility with the new system’s data structure. This may involve standardizing formats, resolving duplicates, correcting errors, and enriching data where necessary.

Once the data is cleansed and transformed, the vendor typically provides a set of predefined templates or data migration tools that can be used to import the necessary information. Careful validation and reconciliation processes should be conducted to verify the accuracy and completeness of the migrated data.

3. Integrate TMS with existing systems:

To receive the best return on investment (ROI) from a TMS, integrate it with other logistics platforms. Integration enables real-time data exchange and collaboration with external stakeholders, including customers, carriers, suppliers, and trading partners.

For instance, integration between the TMS and the WMS is crucial for seamless coordination between transportation and warehouse operations. Integration enables automatic transmission of shipment details, inventory levels, order statuses, and pick-pack-ship instructions between the two systems, ensuring efficient order fulfillment and inventory management.

Integration with the ERP system facilitates end-to-end visibility and control over the entire supply chain process. Key data such as sales orders, purchase orders, inventory levels, and financial transactions can be synchronized between the TMS and ERP, enabling better decision-making and resource planning. Depending on the organization’s requirements, the TMS may need API integration with other systems such as CRM, Carrier Management Systems (CMS), Electronic Data Interchange (EDI) platforms, and GPS tracking systems. 

Going live with a new TMS

Going live with a TMS marks the transition from development and testing to live operation. This phase involves final testing, system monitoring, and addressing any issues that arise before and after the system is launched. 

Before the go-live date, make sure that all system components, integrations, and functionalities are in working order. Test various scenarios, including order processing, route optimization, carrier selection, freight booking, tracking, and reporting. Engage end-users in user acceptance testing (UAT) to validate that the TMS meets their needs and operates smoothly in real-world scenarios. Gather feedback from users to address any usability concerns identified during UAT.

Facilitate an easy transition with a comprehensive support plan. Ensure that a system is in place to provide round-the-clock assistance to users in case of emergencies or critical issues. Designate a support team to respond to user inquiries, troubleshoot technical issues, and provide guidance on system usage. Establish knowledge sharing practices, such as user forums, FAQs, and documentation repositories to empower users and build self-sufficiency.

Measuring and monitoring

Measuring and monitoring performance are critical steps to track progress toward a successful implementation of TMS. Conduct ongoing performance analyses focused on the following KPIs:  

On-Time delivery: Measure the percentage of shipments delivered on time compared to the scheduled delivery date. This KPI reflects the TMS’s effectiveness in optimizing routes, selecting reliable carriers, and managing transportation schedules.
Cost savings: Calculate the reduction in transportation costs achieved through TMS implementation. Compare actual transportation expenses before and after the implementation, considering factors such as freight rates, fuel costs, and operational efficiency improvements.
Carrier performance: Evaluate the performance of carriers based on metrics such as on-time delivery, transit times, tender acceptance rates, and freight claims. Identify top-performing carriers and areas for improvement to optimize carrier selection and relationships.
Order fulfillment cycle time: Measure the time it takes to fulfill customer orders from receipt to delivery. A shorter order fulfillment cycle time indicates improved efficiency and responsiveness in the supply chain, driven by TMS optimization.
Inventory levels: Monitor inventory levels and turnover rates to assess the impact of TMS optimization on inventory management. A well-optimized TMS can minimize inventory holding costs and ensure adequate stock availability to meet customer demand.

Performance analysis fuels continuous improvement

A modern TMS offers unprecedented visibility into every aspect of shipping operations. Don’t let this treasure trove of performance data go to waste: generate regular reports and analytics to track KPIs and performance metrics over time. 

Analyze trends, identify outliers, and benchmark performance against industry standards or internal targets. These performance analysis insights can be used to identify opportunities for process optimization and refinement. Continuously seek ways to streamline workflows, improve efficiency, and enhance the effectiveness of TMS-driven operations.

Working with a managed transportation service provider can boost continuous improvement practices. These partners can facilitate transportation assessments that take into account current operations and highlight areas for future growth.

Take the next step in TMS implementation

A TMS can help businesses make proactive, informed decisions about their transportation operations. Ready to move forward with TMS implementation? Don’t go it alone. 

Managed service partners can supercharge implementation by providing expertise, resources, and support throughout the process. Logistics partners often have deep industry expertise and can offer insights into best practices, industry standards, and regulatory requirements. 

TMS consultants can also provide skilled personnel, including project managers, TMS consultants, developers, and system administrators, to augment the organization’s internal team during implementation. This helps alleviate resource constraints and ensures that the implementation project stays on track.

To learn more about how Uber Freight drives efficiency with a cutting-edge TMS, request a demo today..