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How to Select a Transportation Management System: Do Your Homework

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It may sound surprising, but many shippers still use spreadsheets, emails and phone calls to manage parts of their supply chain. As the logistics and transportation industries continue to undergo a digital transformation, more and more companies are turning to automation to run their businesses as efficiently and profitably as possible.

Transportation Management Systems (TMS) are often considered the backbone of the supply chain, and for good reason. Such systems help companies move freight from origin to destination, but they can do so much more, including:

  • Improve forecasting of shipment volumes

  • Track shipments and optimize transportation routes

  • Track critical back-office data, including invoicing and other finance functions

  • Automate manual tasks to reduce administrative costs so employees can focus on other parts of the business

  • Provide valuable insight into costs so expenses can be tracked, managed and, if necessary, tweaked

  • Store data and business insights in one, easy-to-view centralized platform

Choosing the right TMS for your business may seem daunting. While it does require some upfront planning, that effort will pay off in the end with a platform that truly meets your business needs.

Where to Start

The best place to start is to do a thorough analysis of your company’s logistics needs and goals. Doing so is the best way to ensure you don’t find yourself locked into a technology investment that won’t scale as your business grows. Also, a complete understanding of how your company runs its logistics operations will give you a solid foundation for determining which system is the best able to meet your needs today, and in the future.

When TMS first hit the scene in the 1980s, they were entirely on-premise. Thankfully, we’ve come a long way from the clunky machines of that era. Now, there are many solutions that cater to companies in every industry and of any size.

Today, cloud-based solutions often offer the most easily scalable option for transportation businesses, with increasingly sophisticated features and functionality that are unlocked by using the cloud. Still, on-premise systems may work best for managing your fleet’s operations, so if your company is still deciding, here are some factors to consider in determining which model is best for your business.

Determine Your TMS Business Needs

The next step in selecting the right TMS is understanding your needs. Gather your internal stakeholders and collectively agree on your list of TMS “must-haves.” Here are a few qualifying questions to ask early in your TMS search:

  • What type of ROI does your company want from its TMS?

  • Will the technology need to grow, scale and adapt as business needs change?

  • What is the budget for the different phases, such as implementation and service?

  • Does the TMS need to integrate with other internal or external systems or solutions?

Once all stakeholders have reached general agreement of what your company wants and needs from your TMS to reach your business goals, move on to external due diligence to help determine which TMS platforms may not be best for your business and thus can be eliminated from your search.

As with any large purchase, it’s good practice to do your homework. Check out research from third-party consultancies such as Gartner and review sites for unbiased accounts/ratings of the market’s top TMS platforms and the pros and cons of each.

Even within one vendor, there could be various platforms to choose from, so you’ll need to determine which one is best suited for your business. For example, Trimble offers multiple TMS platforms designed to meet the needs of fleets of all sizes.

Additional Considerations for Choosing a Transportation Management System

Here are a few key factors to keep in mind when selecting a TMS:

Integrations with other systems: Today’s supply chain is complex, so it’s more important than ever that your logistics systems work together to automate processes, maximize operational efficiencies and improve customer service. Other solutions that are often integrated with TMS platforms include asset maintenance, real-time visibility, warehouse management systems (WMS), navigation and more. Together with a TMS, these systems can provide a complete picture of your operations in order to execute the distribution and shipping functions as effectively as possible.

Access to real-time data: In today’s fast-paced landscape, visibility into all aspects of the supply chain is critical. Select a TMS that provides detailed business reports that enable you to make adjustments quickly to stay on track. Also, select a system that delivers information relevant to your KPIs so you can continually evaluate your TMS to ensure it’s delivering the value you expected.

Reliable and secure: Supply chain downtime can be costly. Ensure that your TMS provides adequate reliability and connectivity in the event of an internet outage. Also ensure that there are rigorous security measures in place to protect your business from data breaches.

Scalable: In addition to managing your regular workload, the TMS you choose should be able to scale to handle periods of high demand.

Customer satisfaction: Choose a TMS that enables timely and accurate customer communication. Look for options with a secure, online portal where customers can view real-time fleet status. Also select a provider that provides around-the-clock support with timely response levels.

Invest in Technology with the Future in Mind

With supply chain operations changing all the time, it’s important to select a provider that understands your technology needs now and can scale alongside your business. By choosing the right technology partner, you can be confident that you have the right tools in place today and as you adapt to the ever-changing supply chain.

Each day, Trimble helps businesses just like yours harness the power of a TMS across their operations. Check out this case study to see how a Trimble TMS helps Daylight Transport cut costs, maximize efficiencies and deliver a strong ROI on their technology investment.