Investing in a new TMS? Here’s how to prioritize your business requirements

There are many compelling reasons for a company to invest in a new transportation management system (TMS). They vary from business to business, but it’s often a mix that includes a need for:

• Transportation cost savings, achieved through optimization, consolidation and improved mode selection
• Shipment visibility and alerting for tighter inventory control and production scheduling
• Automated freight audits and payments to reduce overhead and outsourcing costs
• Better transportation spend visibility to improve freight spend forecasting
• Advanced analytics to better understand freight spend down to the item level
• Headcount reduction in the transportation department by automating functions like tendering

3 steps to get you to the right TMS

Before you select and implement your TMS, remember that success takes time and preparation. With all the features and modules available in today’s TMSs, how do you know which requirements to prioritize?

1. Understand your current transportation capabilities. Before you engage TMS providers, understand what you currently do as a business. Map out your current processes in all critical areas, such as inbound planning, outbound planning, freight payment, tracking and tracing. Insight into the details of your day-to-day activities will help you focus on the must-have areas in your new TMS. It’s important to learn the strengths and weaknesses of your organization when it comes time to implement your TMS. Doing so will help you align your processes with the system’s functionality.
2. Formulate a vision for the future. Your transportation, freight, logistics and planning co-workers, from planners to senior leadership, typically have ideas for making transportation better. Elicit and examine each of these ideas to determine which ones make sense for your business. Then use the ideas to create a vision and goals for what a new TMS will bring to your organization.
3. Create a set of business requirements for each TMS vendor you approach. During your evaluation process, focus on a few key requirements that you feel will be differentiators for your business. Make sure your TMS vendors focus on them. Keep in mind: It’s important for each vendor to demo their product using your data. That way you can be sure your new TMS will meet your requirements. This process will help reveal the strengths and weaknesses of each TMS as they relate to your business. A scoring system is often helpful in evaluating each vendor’s offering. Once you make your selection, align your key requirements with the strengths of your new TMS. This step will help you create an implementation plan that brings value early in the process and sets you up for future success.

Are you a small shipper with a limited national footprint seeking a simpler electronic data interchange-based service model? Or a global third-party logistics provider using an application programming interface and extensive cloud-hosted data to move millions of dollars of freight. Either way, this approach will help you achieve your business and logistics goals. It’ll help you go the extra mile to make the right choice for your company.

— By Kirk Graves