Critical Functionality Of A Good Transportation Management System (TMS)

Critical Functionality Of A Good Transportation Management System (TMS)

AUTHOR

Shyam Soni

TIME TO READ

minutes 

UPDATED ON

April 7, 2021

Many companies make do with Excel spreadsheets, paper invoices and back of the envelop calculations for planning and execution of critical transportation functions. For control they rely on using a harsh voice and long memories of their operators. 

Nothing wrong with that if you can get away with such adhoc systems. 

But, there comes a time when these are just not enough. Companies become too big. People move jobs and institutional memories are lost. The cost of ad-hoc system of manual transportation management become too onerous. The cost of failure becomes too high. Things start slipping between the cracks. 

That is when companies start considering buying an appropriate TMS. 

Appropriate - that is the operative word in the sentence above. 

A TMS that appropriate for a freight forwarder to execute an intermodal shipment across two continents will never be appropriate for a FMCG corporation planning to move (truck/rail) thousands of boxes a day from its factory to distribution centers around the continent.

Ideally a good TMS should be able to facilitate planning, scheduling, execution and post execution compliance and control of all aspects of transportation - loading, carrying, and unloading - for all transportation modes - road, rail, air and sea. 

It should also be capable of smooth facilitation of all aspects of the relationship between the two sides of each transportation equation - the transporter, and their customers. 

No such ideal TMS exists. 

That is why you have to be carefully and picky. You have to find the right system that covers your side of the transportation equation from your perspective - whether you are the transportation company, or the goods owner (the shipper or the consignee). 

You have to ensure that the system covers those functions that are important to your company, and does a good job of facilitating those processes. 

You have to make sure that your team is not distracted with meaningless bells and whistles which might be nice to have but will rarely provide any utility in real life on day-to-day basis. 

Following are some of the key functions from a shipper's perspective for a TMS covering planning, execution and compliance. 

For more details there are many other blog posts covering these topics. 


  • Contract and Rates Management
  • Route planning and Load planning 
  • Service Level Agreement (SLA) Compliance
  • Multi-modal shipment management 
  • Rate/Lane Aggregation and Consolidation
  • Route and stop optimisation
  • Settlements and Financial Payments

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Notes:

  1. These ideas and concepts will be usually expressed by our thought leaders in multiple forums - conferences, speeches, books, reports, workshops, webinars, videos and training. You may have heard us say the same thing before.
  2. The date shown above the article refers to the day when this article was updated. This blog post or article may have been written anytime prior to that date. 
  3. All anecdotes are based on true stories to highlight the key points of the article - some details are changed to protect identification of the parties involved. 
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Shyam Soni

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