Roy Ananny, a Director in the Transportation practice at Chainalytics, joins DAT Freight & Analytics’ Chief Scientist Chris Caplice on the Freightvine podcast to discuss current trends in TMS and how to implement and keep up your very own.
With the increasingly dynamic nature of transportation markets and the growing importance of digitalization, a transportation management system (TMS) is an ever more important tool. Roy’s quarter-century of experience with the essential transportation management tool makes him the ideal expert on the evolution of TMS and how companies can future-proof their investment.
Many find living with their TMS is a “high-maintenance” relationship.
When Chris speaks with shippers in DAT’s Benchmark Analytics consortium, he finds that TMS is one topic that keeps coming to the fore. His conversations reveal that users fall into two categories: they either love their TMS or they hate it. But no matter in which group they are, they have to continually modify their TMS to better procure transportation and handle ongoing dynamic changes.
This connects to two trends Roy sees that have transformed the TMS space. One of them has been the migration of hosting to the cloud. Gradually, TMS implementations have become cloud-based by default. What that means – in general terms – is that the systems are a little less complicated to deploy and manage than they used to be. But just because something is in the cloud doesn’t mean it’s simple.
The other trend is by far the more relevant. Back in the early 1990s, A transportation management system worked in a not-very-well-integrated portion of the workflow. You would receive orders from the enterprise resource planning (ERP) system in some kind of package thrown over the (digital) wall. You and the TMS did what had to be done with those orders – consolidation, optimization, finding carriers, tendering loads, and so on. Then you would electronically wrap it up and send your package back over the wall to the ERP. The TMS was virtually an entirely separate part of the workflow with no further connection or awareness of the rest of the process.
Setting siloed data free allows for better integration.
Fortunately, helped by the advent of the cloud, transportation management no longer works like this. Today’s TMS is an active participant in a more dynamic and much less linear workflow than in years past. For example, there are places in that workflow where you may want to call out to a GPS device and find out where your load is and initiate a recovery workflow if that’s necessary. Or perhaps you’d rather connect to a freight repository hosted on another server and not rely on contract data that were input into the TMS at some indeterminate point in the past.
Today’s leading TMSs better align with partner systems (such as the ERP in the prior section) and other subsystems and data sources. These are part of a holistic transaction-to-delivery ecosystem with access to near real-time information from the entire dataspace in the best implementations.
Unfounded security concerns slow cloud-based integration and interoperability.
In the earliest days of cloud computing, in the mid-to-late 90s, there were genuine concerns about data security. These concerns, mainly dealing with complex issues of data governance, have been dealt with long ago. Data security must comply with much more exacting standards in the modern cloud, such as those presented by HIPAA rules and Department of Defense cybersecurity standards. Still, in some minds, the perception that cloud-hosted TMS implementations are not as secure as those hosted on-premises persists. In reality, most cloud-hosted systems are generally better firewalled and protected than the majority of conventional deployments.
A cloud-based, well-integrated TMS is always a work in progress.
Managers and executives that aren’t transportation people tend to think of TMS as a sort of transportation black box that you can buy and connect, thereby solving all of your problems. The truth is there are many interpretations of the TMS concept, with a multitude of different features and capabilities. It’s not enough to reach out to some TMS providers just to see who has the better-looking demo. It’s essential to have a solid grasp of the particular variables that you need to measure and the areas where you need the most assistance. Be sure the TMS you select is the one most suited to bring relief where you need it most.
And here’s something even more critical. Implementing a TMS so that it becomes an integral part of the holistic ecosystem you’ve envisioned doesn’t take care of itself. You’ll need to invest in the right kind of support by hiring and training staff or seeking a qualified service provider. In addition, you need to recognize that changes in your business generally and your transportation operations specifically will require your TMS to periodically evolve. That is if you expect your TMS to continue delivering the same value in year three as it did on day one.
Implementation and integration of a TMS can be a complex, lengthy process. Reach out to us and find out how Chainalytics can help shorten your time to value. Using one-of-a-kind tools and approaches like digital assets and managed analytics services, we consistently deliver actionable insights and measurable outcomes to our clients.
Roy Ananny, a Director in Chainalytics’ Transportation practice, has 25 years of experience designing, developing, implementing, and integrating transportation management systems. At Chainalytics, he focuses on helping companies find opportunities for supply chain and logistics improvements and implementing strategies and workflows to deliver that value.
